Preventing Malaysia to become the next Greece

“Malaysia will become the next Greece in 9 years” reported a daily, saying that if nothing is done to reduce the current budget deficit; we will become the headline of the world then. Sound scary? 9 more years left only…

 
As a preventive measure, Datuk Idris Jala, Minister in the Prime Minister’s Department, and the head of Performance Management and Delivery Unit (Pemandu), is proposing to cut subsidies that could save up to RM103bn over 5 years for our nation (see chart).

 

 
Amongst the key proposals are:

 
- Petrol prices will increase by 15 cents/liter in mid-year, and thereafter 10 cents every 6 months until 2014.
- Toll rates to increase as per concession agreements, except for those without alternative toll-free routes.
- Electricity tariffs will be raised by RM0.024/Kwh and thereafter RM0.016/Kwh every 6 months.

 
If implemented, the country budget deficit may see a small budget surplus of about 1% of GDP in 2012. And, inflation will rise to 4% in 2011-12 before easing to 3% in 2013.
To gather feedback from the public on its proposals, Pemandu had organized the Subsidy Rationalisation Lab on 27 May. According to Pemandu, the Government provided a total of RM74bn as subsidies in 2009.

Well, I supported the subsidy reduction and it should be done gradually over the next few years. While cutting subsidies will benefit the nation in the long run, Malaysians would face financial difficulties in the short to medium term. Anyway, this is a very good opportunity to test the spirit of 1Malaysia.

 
I think, if Rakyat can face it, Government must do following too.
  1. Reducing red-tape of doing business.
  2. Reducing Government’s total operating expenditure.
  3. Be efficient or cost effective.
  4. Besides rewarding, penalized or remove those non-performing civil servants.
  5. Ensuring fair pricing of projects/deals, by using open-tender system.
These measures could prevent Malaysia for following Greece’s footstep also. It must be two ways actions, not only from Rakyat itself. Government should lead an example, so that Rakyat could face it voluntary.

Comments

Post a Comment

Popular posts from this blog

"You Can Keep Your Existing Health Insurance"

I wondered about this statement at the time Obama made it.  Clearly, by changing all the rules of health care insurance and mandating conformity, it was unlikely that the vast majority of Americans would not find themselves forced by 'The Affordable Care Act' to have to deal with a completely different health insurance plan and completely different set of health care providers. I now understand what Obama meant.   He was speaking to his immediate family and (politician) friends.  They are exempt from the "Affordable Care Act."  Clearly what he meant to say was: "if you are exempt from Obamacare, like me and my family, you can keep your existing health insurance."  He never meant to mislead.
Read more

Why Gold and Silver? Why Online Store?

Image
Are you first time gold and silver buyers? Why don't you invest in these popular metals? If you did so, you have had a wonderful investing experience after 2008 global financial crisis. But, do you really understand these metals? Were they really precious (especially now)? Traditionally, gold and silver were one form of exchange. Because of the invention of fiat money, they were being turned into some short of "back-up" currency , in case our fiat money system go burst. It's natural when things go wrong, gold and silver tends to appreciate in value. In other words, people hold precious metals to preserve the value of their assets. 3 Reasons Why Gold and Silver... Still hot in demand , especially by emerging affluent Chinese. Traditionally, Chinese loves gold. They bought it for events such as new born baby, new year, wedding and even funeral ceremony. Strengthening USD ??? Yes. It's a correct reason also. Why? Because of news that US going to stop QE3, USD is str...
Read more

Things We Now Know

The poor are losing ground in the new Obama world.  The facts are showing up even in the halls of collectivist extremes like the New York Times.  The rich are getting richer and poor are being locked in place.  Big government is throttling the economy and the hopes and dreams of lower and middle class Americans. Today's Wall Street Journal's article by Simon Constable lays out some of the simple and obvious facts of the Obama era: "The richest 20% of households account for 38% of spending, according to government data for 2011, the latest available.  Compare that with 2003 when the top earners spent 26% of the total."  The article goes on to say..."it could get even worse."  It will. Who really benefits when the regulators strangle the banks?  Do banks really need to get much more conservative in their lending practices?  Why does the government know best?  How far can you stretch the FDIC guarantees before American banking is simply a subsid...
Read more