The government's continuing quest to build up a strong domestic economy is crucial to ensure sustainable growth and cushion the nation against downside risks due to the volatile global economy, PM Datuk Seri Najib Tun Razak said yesterday. He said that creating a stronger domestic economy and consolidating subsidies are among pivotal thrusts of the government as evidenced by proposals made in the 2013 Budget. Getting a fresh mandate from the upcoming general election is crucial to ensure continuity of the Economic Transformation Programme (ETP) and Malaysia achieving its high-income nation status, he said. Through the implementation of projects under the ETP, Malaysia would be able to reduce the country's dependency on resources like oil as the major source of revenue while developing other sectors that can generate new revenues, he said. Besides diversifying the income stream for the country, he said that it was important to rationalise subsidies and deliver targeted subsidies to certain groups. He said that it would not be right to raise prices of subsidised items just after getting a mandate for the next five years as the people might question the government's sincerity. He also pointed out the importance of having free trade agreements on the back of global uncertainties and strengthening trade relations between Asean countries and East Asian countries to build a strong domestic economy. (BT)
PM Datuk Seri Najib Tun Razak highlighted his administrations’ growing resolve to rein in government debt by pointing out smaller deficit goals and let on the possibility of a budget surplus materializing after 2016 during an interview with CNBC Asia anchor Martin Soong yesterday. “By 2015, the budget deficit would be 3% of GDP. And beyond that, I would like for us to see a surplus, if possible. But I’m not going to commit to that surplus yet. Let’s get to 2015 first,” he said. (Financial Daily)
The world economic crisis could take 10 years to run its course, the IMF's chief economist Olivier Blanchard said, whilst urging greater solidarity between member countries of the eurozone and more integration in fiscal and economic policy. (AFP)
The US ISM non-manufacturing index rose to 55.1 in Sep, the most in six months, from 53.7 in Aug. Economists were expecting a reading of 53.4. (Bloomberg)
The ADP National Employment Report showed US private employers added 162,000 jobs in Sep, but fewer than the revised 189,000 hired in Aug. (Reuters)
Eurozone producer prices climbed 0.9% mom in Aug, the most since Jan, after rising from a downwardly revised +0.3% in Jul. On a yoy basis, the measure gained 2.7% in Aug, faster than the 1.6% recorded in Jul. (MNI News)
The final reading of the eurozone composite PMI fell to 46.1 in Sep from 46.3 in Aug, above an initial estimate of 45.9 published 20 Sep. The services PMI slipped to 46.1 from 47.2. (Bloomberg)
Eurozone retail sales rose 0.1% mom in Aug (a revised 0.1% in Jul). Economists had forecast a decline of 0.1%. (Bloomberg)
Portugal unveiled a 4% extraordinary tax and income tax brackets would be reduced from eight to five. The average tax hike would rise from 9.8% in 2012 to 13.2% in 2013. New measures also include new levies on capital gains and a financial transaction tax, though details of these moves have yet to be finalized. (CAN)
The ADB forecast Asia excluding Japan’s expansion will hit 6.1% this year (6.6% in the Jul estimate; 6.9% in the Apr prediction), the slowest pace since 2009, before rising to 6.7% in 2013. It also reduced the region’s inflation forecast for 2012 to 4.2% from 4.4%. China's GDP was tipped to expand 7.7% this year before bouncing back to 8.1% in 2013, but still well below the 9.3% achieved last year. India would see GDP growth slow to 5.6% in 2012 before picking up to 6.7% next year. Thailand’s 2012 growth forecast was lowered from 5.5% to 5.2%, whilst 2013’s growth was cut to 5% from 5.5%. (Bloomberg, AFP, Bangkok Post)
China’s official services PMI fell to 53.7 in Sep from 56.3 in Aug, indicating the industry’s expansion was the least in over a year. (Bloomberg)
Japan’s monetary base rose 9% yoy in Sep to a record ¥124.3tr (6.5% in Aug), as ultra-easy monetary policy led to an increase in the current account deposits that commercial banks keep with the Bank of Japan. (Business Times)
Japan’s labour cash earnings grew 0.2% yoy in Aug following a 1.6% fall in Jul. Economists expected a 1% fall in wages in Aug. (RTTNews)
Indian Prime Minister Manmohan Singh is seeking to build on the biggest opening of the country’s economy in a decade with the cabinet today scheduled to consider proposals to lift caps on foreign investment in insurance and pension industries. (Bloomberg)
Thailand’s consumer confidence index fell to 77 points in Sep, down from 77.9 points in Aug and 78.1 in Jul, according to the University of the Thai Chamber of Commerce's Center for Economic and Business Forecasting.(Bangkok Post)
Eight key areas in Bangkok could be under as much as 30cm of water for up to two weeks this month, especially when Tropical Storm Gaemi brings in torrential rain this weekend, a Bangkok seminar on flood prevention was told yesterday. (The Nation)
Bank of Thailand chairman Virabongsa Ramangkura is adamant that the policy rate could be slashed without damaging long-term economic stability, arguing that lower interest rates would benefit the economy as well as the central bank's finances. He added that the Pheu Thai government's massive investment in infrastructure will be the catalyst to strengthen the country's manufacturing and logistics competitiveness (The Nation)
The revised Power Development Plan (PDP) spanning 2013-30 requires a total budget of THB800bn for power plants and transmission lines, said the Electricity Generating Authority of Thailand (Egat). (Bangkok Post)
Myanmar's economic growth will speed up as most other economies in developing Asia are expected to see slower growth amid a slump in global demand, the Asian Development Bank said. (The Nation)
Hundreds of thousands of workers from more than 700 companies in 80 industrial estates across Indonesia staged a one-day strike Wednesday in the latest of the country's frequent labor protests. The protesters allege that employers largely ignore legal obligations to contribute to pension funds and state health care. They are also seeking higher levels of minimum wage and a reversal of the government's plan to require low-income workers to contribute to payment for health-care premiums beginning 2014. (WSJ)
Australia's trade deficit blew out to A$2.03bn (US$2.07bn) in Aug (-A$1.5bn in Jul), its widest in three-and-a-half years, as falling prices for iron ore and coal ate into export earnings. (WSJ)
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