There will be another round of economic liberalisation in the Budget announcement next month, said PM Datuk Seri Najib Tun Razak. "Liberalisation is good for our long-term sustainable competitiveness. It builds our intrinsic strengths not through protection or subsidies," he said in an interview with Forbes Asia Magazine.
• "We should be competitive because of factors such as our productivity, technologies and processes," said Najib.
• On the country’s economic ties with Asia and the Middle East, he said: “One area I would like to enhance significantly is to encourage the Chinese to increase their longterm investments in Malaysia beyond short-term investment in projects such as construction”. (Bernama)
All Malaysian gasoline stations will offer bio-diesel fuel by next year, Plantation Industries and Commodities Minister Bernard Dompok said. Meanwhile, Malaysia expressed concern over an Australian palm oil-labeling bill, he said. “We are seeking help and have written to some of the lawmakers in Australia to oppose the bill. We are confident that the Australian federal government will reject the bill,” he said. (Bernama)
The government targets to achieve at least 48% highly-skilled workers by 2020, in line with the country's aspiration of achieving high-income nation status. Human Resource Minister Datuk S. Subramaniam said Malaysia's workforce was still relatively low-skilled with 80% of them educated up to only the Sijil Pelajaran Malaysia (SPM) level or equivalent in 2007. "And today, only 25% of Malaysian jobs are considered skilled. This is much below that of Singapore at 49%, Taiwan at 33% and South Korea at 36%," he said. (Bernama)
The Rubber Industry Smallholders Development Authority (RISDA) has been allocated RM121m by the government to carry out rubber replanting programme, covering 40 hectares nationwide, next year. Its chairman, Tan Sri Rahim Thamby Chik, said it was the biggest allocation received by Risda. Under the replanting programme, each small holders in the peninsula would receive aid of RM9,230 per hectare, while those in Sabah and Sarawak would get RM14,000, he added. (Bernama)
Malaysia has made an encouraging move by restructuring its economy and building a positive environment to attract foreign investments into the country, said chairman and editor-in-chief of Forbes Media, Steve Forbes. There had been more follow through action from two years ago, including reducing investment barriers such as taxes and bureaucracy as well as dealing with subsidy related issues, he said.
• Forbes said Malaysia can offer attractive packages such as strategic location, rich resources, a good English speaking population, a government friendly towards investors and policies that are developed towards opening up the economy.
• The government's efforts to help develop what economists called "intellectual capital" to move ahead and continuously make changes, was a positive step to enable the country to make the transition and achieve the goal of becoming a high income economy in the next decade, he added. (Bernama)
The affirmative action taken by the government which is merit based and the free trade agreements (FTAs) signed with several countries are proof that Malaysia is not a protectionist country, Minister of International Trade and Industry Datuk Seri Mustapa Mohamed said. "We are now talking to nine countries on Trans-Pacific Partnership (TPP) Agreement including U.S. and we are also discussing with the European Union on a possible FTA. It clearly shows that Malaysia is a very open economy and not a protectionist economy," he added. (Bernama)
According to a survey done by The Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM), entrepreneurs consider government policies (46%) as the key factor that most “adversely” affected their business performance in 1H11. Its president Tan Sri William Cheng Heng Jem pointed out that rising fuel costs, more expensive natural gas and higher electricity tariff as a result of the government’s efforts to trim subsidies are putting a burden on the business community.
• Cheng also voiced his concern over the government’s plan to raise the minimum wages in the country which will eventually add more to the cost of doing business.
• Besides that, external risks posed challenges to local businesses despite projects under the Economic Transformation Programme and the government's measures to promote domestic demand, he noted.
• Given the increasingly uncertain global economy, he said, Malaysian businesses would continue to look towards the government to introduce and implement stimulating economic policies and accelerate implementation of public development projects to ensure domestic demand remained strong.
• About 59% of the businessmen expressed confidence in their business outlook for next year while 62% were confident for 2013. (Financial Daily, Bernama, The Star)
Malaysian manufacturers should take note of the rise in demand for green and ecofriendly products and systems in Thailand, said the Malaysia External Trade Development Corporation (Matrade). This is due to the growing trend of eco-friendly office buildings and hotels in the country which are implementing green technologies.
• Green products that Malaysian companies can supply include, air and water care systems, cleaners and degreasers, energy-efficient electrical systems and appliances, environmental-friendly materials, water-efficient equipment and water usage systems, it noted.
• Malaysians can also supply carbon monoxide monitoring systems for underground car parks and systems to harvest waste water and rain water to provide irrigation, it added. (Bernama)
Big Japanese manufacturers have turned optimistic about conditions in 3Q as bottlenecks in manufacturing eased following the 11 Mar natural disaster. The business survey index (BSI) of sentiment at large manufacturers stood at +10.3 in 3Q (-23.3 in 2Q), a joint survey by the Ministry of Finance and the Economic and Social Research Institute showed. (Reuters)
This year’s surge in Russian wheat exports, big enough to feed Japan for more than two years, may fail to stop a rally as global demand overwhelms supply curbed by droughts from the U.S. to Australia. Russian sales will gain more than fourfold to 17.9m metric tons this year, second only to the U.S., analysts’ forecasts showed. That won’t be enough to stop global stockpiles shrinking for a second year, the U.S. Department of Agriculture estimates. Prices will rise 16% to US$8.50/bushel by the end of Dec, according to analysts surveyed. (Bloomberg)
Vietnam auto sales rose 9.8% yoy in Aug (-11.0% in Jul), to 9,518 units, reversing the recent negative trend, partly due to sharply higher passenger car sales. (Reuters)
Thailand’s government signalled it wants the nation’s central bank to stop raising interest rates as it seeks to stoke growth. The Bank of Thailand has boosted borrowing costs six times this year to damp inflation, raising rates by the most in Asia outside India. The state planning agency in Aug cut its 2011 growth forecast to 3.5%-4.0%, from 4.5% earlier. These remarks signal a conflict with the central bank’s stance that may lead to a stalemate in policy making. (Bloomberg)
China's central bank said that stabilizing prices remains its priority, reinforcing signs that Beijing is unlikely to loosen the reins on the world's No. 2 economy any time soon despite mounting global uncertainties.The People's Bank of China also gave fresh acknowledgment that its traditional measuring tools have failed to keep up with recent changes in the Chinese financial system and it is considering adjusting its benchmark money supply measure to help plug the resulting gaps. (Wall Street Journal)
India: India industrial output grows at slowest pace since 2009, missing estimates
India’s industrial production grew in July at the slowest pace in almost two years as consumer demand moderated after record interest-rate increases. The INR fell to the lowest level in more than a year. Output at factories, utilities and mines rose 3.3% from a year earlier, following an 8.8% gain in June, the Central Statistical Office said in a statement in New Delhi yesterday. Reserve Bank of India Governor Duvvuri Subbarao has to weigh the risks to expansion posed by Europe’s debt crisis and a faltering US recovery against inflation when he makes his next policy decision on 16 Sept. (Bloomberg)
EU: Italy turns to China for help in debt crisis
Italy’s centre-right government is turning to cash-rich China in the hope that Beijing will help rescue it from financial crisis by making “significant” purchases of Italian bonds and investments in strategic companies. Italian officials were in Beijing two weeks ago to meet CIC and China’s State Administration of Foreign Exchange, which manages the bulk of China’s USD3,200bn foreign exchange reserves. Italian officials said further negotiations were expected to take place soon. The possibility of Chinese investment comes at a critical moment for Italy, as markets demand increasingly high yields to buy Italian public sector debt, projected to reach 120% of GDP this year, a ratio second only to Greece in the Eurozone. (FT)
EU: Papandreou sets new measures to skirt default
PM George Papandreou, vowing to avoid a default and keep Greece in the Euro, approved new measures to help plug a yawning budget gap as resistance builds at home and in Europe to extending more aid to the European Union’s most-indebted nation. The Cabinet yesterday voted to cut one month’s wages from all elected officials and impose an annual charge on all property for two years, to be levied through electricity bills to ensure rapid collection, Finance Minister Evangelos Venizelos told reporters in the northern Greek city of Thessaloniki. The measures will help the country meet deficit targets of EUR17.1bn (USD23.6bn) in 2011 and EUR14.9bn in 2012, covering a EUR2bn shortfall for this year that has been exacerbated by a deepening recession, he said. (Bloomberg)
US: Plan emerges to pay for Obama Jobs Bill
President Barack Obama is targeting high earners, private equity managers and oil and gas companies in his bid to pay for a USD447bn job-creation plan. The revenue-raising provisions of the legislation that Obama sent to Congress today were mostly pulled from previous administration budget proposals that have been rejected by Republicans in Congress. At a White House Rose Garden event earlier today, Obama called on lawmakers to act on the proposal with “no games, no politics, no delays.” Republicans, who control the House of Representatives, have signaled they may be willing to support some of the tax cuts for businesses and workers Obama recommends while expressing skepticism about his spending proposals and reliance on raising taxes for some individuals and industries. (Bloomberg)
The U.S. economy will grow less than previously estimated through 2012, reflecting a slump in confidence, limited consumer spending and a struggling housing market, a survey showed. Gross domestic product in the world’s largest economy will expand 1.7% this year, less than the May forecast of 2.8%, according to results of a survey by the National Association for Business Economics. Growth in 2012 will average 2.3% after a previous projection of 3.2%. (Bloomberg)
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