JULY 29 — It came as no surprise that the government blamed the global financial crisis as the reason why our foreign direct investment (FDI) plunged by a shocking 81 per cent last year.
Trade Minister Mustapa Mohamed reportedly said that the government acknowledged the “dampening” of FDI inflow into Malaysia, but said it reflects a larger trend where world FDI flows in 2009 fell by 37 per cent.
There is a huge gap between 81 per cent and 37 per cent, if our government knows how to do the maths.
The figures in the World Investment Report 2010 by Unctad, a United Nations think-tank, which showed Malaysia’s FDI dropped to US$1.38 billion (RM4.4 billion) last year from US$7.32 billion in 2008, are both ironic and telling.
The report has not only confirmed that we have lost much of the shine to our neighbours, but it also reveals a grim picture for us to restore investors’ confidence and present ourselves as a competitive nation.
Since Prime Minister Najib Razak took power last year, he has launched a series of “feel-good” policies like the New Economic Model and the 10th Malaysia Plan, which were hyped up as people- and investor-friendly policies.
The truth remains that we’re still struggling to combat our ballooning budget deficit, which the government aims to narrow to 5.3 per cent this year; despite that analysts are doubtful whether that is attainable after the government pumped in RM67 billion last year for the two largely ineffective stimulus packages.
Najib has not really tackled the issue of how to make the Bumiputeras more competitive; the race-based affirmative action policy remains while corruption and leakages in the government delivery system are rampant.
It is the ordinary Joes who are the ones who suffered the most with the “5-in-1” price hikes recently while tens of millions were spent to hire a public relations firm to boost the PM’s image.
During this time, his wife enjoys a good time with her guest like Hollywood star Robert De Niro who she said would help to clear “misconception” about Malaysia among foreigners (though the latter says he was on a private visit, we have no clue whether the rakyat’s money is involved to treat him nasi lemak and roti canai).
Compared to our neighbours, we did not see such a drastic decline in FDI in Thailand which suffered its worst political violence in decades in recent months.
The Bank of Thailand has raised its economic growth forecast recently and expects the country to grow a strong 6.5 to 7.5 per cent this year.
Singapore, meanwhile, is set to become the world’s fastest-growing economy this year after the government said it will expand between 13 and 15 per cent.
And Malaysia? Our economy is officially forecasted to grow 5.5 per cent this year though Najib himself would love to see a 6 per cent expansion.
Perhaps he require some help from his wife’s guest Robert De Niro to achieve this.
* Mohamed Azmin Ali is PKR vice-president, Gombak MP and Bukit Antarabangsar assemblyman.
* This is the personal opinion of the writer or the publication. The Malaysian Insider does not endorse the view unless specified.
