The fallacy of Malaysia’s bankrupt economy

Datuk Seri Panglima Salleh Said Keruak

Deputy Umno Sabah Chief

The opposition Pakatan Rakyat’s campaign is that Prime Minister Najib Tun Abdul Razak is leading Malaysia to bankruptcy. Hence, to save Malaysia, Najib needs to be ousted and replaced. And, of course, when they say replaced here, they mean replaced with Anwar Ibrahim.

This is mere political rhetoric and rhetoric not supported by data. And if you were to look at the statistics, you can see that the opposite is happening to what the opposition is telling us.

All countries have debts, even the richest country in the world. What is more important, though, is the debt to GDP ratio, and Malaysia’s ratio is even lower than Singapore’s.

Malaysia’s exports have doubled since 2009 and the exports are still higher than imports. And Malaysia’s external debts are less than half of what it was ten years ago.

We are being told that the Ringgit has declined in relation to other currencies. That may be true but a declining rate of exchange is not always due to a weak economy, as currencies are subject to speculators who trade (or rather gamble) in money like they do the stock market and casinos.

Many countries, in fact, have seen a decline in exports because their currency is too strong. These countries would rather that their currency goes down so that they can see exports go up.

We will need another year to see the positive affects of a lower Ringgit. However, most economists would tell you that a lower Ringgit could only benefit Malaysia’s exports since Malaysian goods would now be more competitive.

Europe has shifted its manufacturing to cheaper countries exactly because of this and because of the high manufacturing cost in their home country. Even Australia is going to close down it last automobile-manufacturing plant and over the next few years there would no longer be any cars manufactured in Australia. And the countries that are going to benefit would be those countries that are cheaper.

There are Malaysians who do not understand how the economy works and they fall for the opposition propaganda. Most countries would be very happy if they can even see 1% or 2% growth instead of negative growth. And amidst all this gloom and doom, Malaysia is going to see 5% growth this year.

Malaysia is going to be the envy of many industrialised nations that have a hard time just keeping its people employed.