Package: Positive Reaction From Govt, Opposition MPS

KUALA LUMPUR, March 10 (Bernama) -- Members of Parliament from both sides of the bench today reacted positively to the second stimulus package tabled by Deputy Prime Minister Datuk Seri Najib Tun Razak, saying the mini budget was a timely move to help the people tide over the global economic gloom.

They said that the package would also enable industries to move ahead on various fronts and not to be encumbered by the slowdown.

Even the creative industry would benefit from the package, Information Minister Datuk Ahmad Shabery Cheek said.

He said the RM20 million allocation for Radio Television Malaysia (RTM) proved that the creative industry was equally important to spur growth.

"The allocation will be used to create content in the music industry, with RTM launching a new 24-hour 'Muzik Aktif' channel over Channel 180 on Astro on Thursday," he told reporters at parliament lobby.

He said that RTM would take appropriate action to implement the project to encourage quality content from players in the creative industry.

Transport Minister Datuk Seri Ong Tee Keat said the construction of new low-cost terminal showed that the government was committed to enhancing competitiveness in the country's aviation industry.

He said the government had identified RM5 billion investment, which would be implemented "off-budget", including a low-cost carrier terminal project and expansion of Penang airport, at the cost of RM2 billion and RM250 million respectively.

Education Minister Datuk Seri Hishammuddin Tun Hussein said he was grateful that the package still managed to give priority to education despite the economic slowdown.

"Dilapidated schools would be given attention, as well as schools in rural areas," he said.

Health Minister Datuk Seri Dr Liow Tiong Lai thanked the government for allowing the contract employment of some 1,000 health assistants in local authorities in a move to stamp out infectious diseases such as dengue.

Higher Education Minister Datuk Seri Mohamed Khaled Nordin said the proposal to increase the number of scholarships for entry into local private universities would enable more students to pursue higher education.

Agriculture and Agro-based Industry Minister Datuk Mustapa Mohamad said the package would help reduce the burden borne by farmers, fishermen and livestock breeders.

Rural and Regional Development Minister Tan Sri Muhammad Muhamad Taib said the huge allocation for rural development would be welcomed by the people especially those in Sabah and Sarawak.

PAS Youth chief Salahuddin Ayub said he hoped that the training and job opportunities announced in the package would be realised to address workers' retrenchment.

DAP secretary-general Lim Guan Eng said he did not expect Najib to announce a big amount.

"This is not just RM10 billion (as reported). I've said previously that there should be an additional allocation of RM30 billion.

"It turns out that the amount announced by Datuk Seri Najib is RM60 billion for two years," he said.

(Source: BERNAMA)

Najib signals return to ‘Big Govt’

MARCH 11 – The man slated to take over Malaysia’s government later this month hasn’t said much about his economic philosophy. But with the announcement of a 60 billion ringgit(US$16 billion) stimulus package yesterday, one thing is clear: Najib Razak is no free-market reformer.

Najib, who is currently deputy prime minister, called yesterday’s package “unprecedented in the nation’s history.”

For an expenditure of roughly 9 per cent of 2008’s GDP over two years, that’s no exaggeration. Malaysia will raise debt to fund this largesse. The fiscal deficit is now projected to reach a whopping 7.6 per cent of GDP, up from 4.8 per cent.

Malaysia is following in the fiscal footsteps of the US, Australia and Japan, but that doesn’t make it smart.

The “stimulus” from all this spending will likely be limited. Most of the money will be spent on loan guarantees, infrastructure and public sector expansion, rather than on tax cuts that could stimulate productive growth.

State-owned investment company Khazanah, for instance, will be handed 10 billion ringgit. Pet projects such as “green investments” and the state-run automaker will also see cash handouts. The government itself will hire 63,000 workers.

This is effectively a restatement of Malaysia’s old, government-knows-best policies. It’s the opposite of what Malaysia really needs, which is to ditch this thinking and shift to a business climate that encourages private investment and entrepreneurship. The government predicts GDP could shrink 1 per cent this year.

Yesterday’s fiscal expansion is also a political risk for Najib and his ruling coalition. Malaysian voters, fed up with the government’s racial politics and lacklustre economic growth, handed opposition parties roughly one-third of the national parliament last year and victories in two subsequent parliamentary by-elections.

If Najib’s package doesn’t work, the voters may protest again at the polls. – The Wall Street Journal

(Source: Malaysian Insider)