UPDATED
SINGAPORE, Nov 13 — Prime Minister Datuk Seri Najib Razak said today he would push hard to ensure Malaysia achieves a five per cent economic growth in 2010, two per cent more than earlier estimated by the government.
He said his administration would unveil a new economic model for Malaysia by year end, which would identify new sources of growth, to ensure the country achieved a higher rate than three per cent post-crisis.
“I’m not sure whether I will get it. But I will try my level best,” Najib determinedly told a dialogue session at the Asia Pacific Economic Cooperation (Apec) CEO Summit held on the sidelines of the Apec Leaders meeting at Suntec here.
Najib explained that the new source of growth would include the strengthening of domestic demand and getting the private sector, which was still not doing enough in Malaysia, to become actively involved.
Telling the audience that he had asked his ministers and officials to get the extra two per cent by next year and possibly beyond, Najib said he would push hard to make the government more efficient, business friendly and sell Malaysia’s story abroad.
To a question, he said with the recently-introduced economic reforms, he was confident that the current two government stimulus packages would work for Malaysia.
“Well, it better work. Otherwise, you won’t see me around for too long,” Najib said candidly, drawing loud laughter from around the summit hall.
He said Malaysia’s stimulus packages were one of the highest in the world, as it was in the region of 9.0 per cent of the GDP.
Since being introduced, the economic numbers had been going up, especially in the second half of this year, Najib said, adding that next year, as forecast by the International Monetary Fund, Malaysia’s economy is expected to grow at 2.5 to 3.0 per cent.
He said the government had also added RM1 billion in its spending every month since the introduction of the stimulus packages.
Najib also listed the economic and financial reforms that the government had introduced, such as the liberalisation of the 27 sub-sectors and the financial sector, the imminent issuance of licences for new commercial banks for foreigners to participate in the country’s financial sector, the growth of the Islamic finance, and also doing away with Foreign Investment Committee (FIC) guidelines with respect to Bumiputera equity.
“If you take it as a whole, the plethora of measures we have introduced has struck a strong resonance domestically as well as internationally,” Najib said, adding that without the economic measures, Malaysia would not be getting the three per cent growth rate.
Asked whether the global economic crisis was over, the prime minister answered with a resounding “yes”, but tempered it with two caveats, asking whether it would be sustainable and if growth could be the same as the pre-crisis level.
He said countries that had large domestic markets like China and India and to some extent Indonesia, would do well next year and probably beyond.
But countries that had greater dealings in the global market like Malaysia and Singapore, which have total trade twice its GDP, were not really decoupled yet from the advance economies in the west, Najib said.
He said although the financial sector in the west had somewhat recovered in terms of government guarantee, the real economy there was still going through a major adjustment due to high unemployment, rising fiscal deficit and loss of consumer confidence.
The prime minister also listed several approaches that would help to attain a sustainable growth rate in the global economy.
He said world economies must strongly reject protectionism, conclude the Doha Round by next year, and there must not be any premature withdrawal of incentives for fiscal packages until there was real recovery led by the private sector.
Najib also said reforms must be implemented in the new global financial architecture, by ensuring a better regulatory mechanism, and having closer supervision especially on derivative products.
Countries like Malaysia, he said, would require a new growth, new model and new strategies to be put in place.
In that context, Najib said Malaysia’s new economic model would based more on innovation, high value, the search for a new source of approach, strengthening domestic demand and the long term goal of greater integration within the East Asian economy.
“So, if we put in place some of the short and medium term measures, hopefully we will get growth rates back on track,” Najib stated.
He said the Apec meeting here was a wonderful opportunity for its members to make a strong political statement on fighting and resisting protectionism and wanting the Doha Round to be completed.
He expressed the hope that the United States could bring the Doha Round to a successful conclusion.
“I have been saying it privately, but now let state openly. The thing I liked about (former US) President (George) Bush’s foreign policy was that, he was very pro-free trade,” Najib confided.
Even though he did not agree with other policies of Bush, Najib said he liked the president’s policy on free trade and that he stated this strongly at the Apec meeting in Lima, Peru.
“I hope the same message will be repeated in Singapore and the leaders will see to it that the Doha Round is completed next year,” the prime minister added. — Bernama
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