Posted on 27 May 2009
The Malaysian economy will shrink by more than what was predicted for the year given the current economic backdrop, according to Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah.
“It will definitely be a little lower than the -1% predicted for the whole year,” he said after officiating the launch of the Securities Commission’s (SC) Executive Enhancement and Development (SEED) programme yesterday.
Husni was reiterating what Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz had said on May 9 that the central bank would lower the country’s 2009 economic forecast amid a worse-than-expected slump in exports.
Datuk Seri Zarinah Anwar (left) and Datuk Seri Ahmad Husni Hanadzlah launching the commision’s Executive Enhancement and Development programme
He said the Government was reviewing the current 2009 forecast of a 1% drop or 1% growth, and was expected to announce the revised gross domestic product (GDP) forecast tomorrow after Bank Negara releases the country’s first-quarter economic data today.
“Then, we will know the position of the country’s economy,” he said.
However, as the impact of the RM67bil economic stimulus package worked its way through the economy, “we believe next year will be very positive,” Husni said, adding that the stimulus measures should help the economy show some signs of recovery by the third quarter.
He also said the country was looking at more liberalisation measures to attract investments.
A recent StarBiz poll of six economists showed that the local economy was expected to grow by 3% to 4% in 2010 after experiencing a contraction this year.
This would be supported largely by a recovery in exports and the follow-through impact of fiscal spending and easing of monetary policy.
The central bank has cut interest rates by a total of 150 basis points from 3.5% to 2% since November to cut the cost of lending and boost domestic consumption.
“Although it would be prudent to prepare ourselves for two to three years of weak and perhaps volatile growth in the advanced economies now facing tough economic and financial restructuring challenges, we are maintaining the 3.8% GDP forecast for Malaysia in 2010,” RAM Holdings Bhd group chief economist Dr Yeah Kim Leng told StarBiz.
Meanwhile, in her speech at the function, SC chairman Datuk Seri Zarinah Anwar said the SEED programme was expected to create 500 jobs in the capital market for Malaysian graduates.
“The SEED programme offers a truly unique opportunity to train and develop graduates with a long-term prospective of capacity building to ensure that the capital market talent pipeline is filled continuously with skilled and knowledgeable employees,” she said.
