October 11, 2012
National Debt: Putting Malaysia at risk
by Ahmad Fadli KC (10-10-12)@http://www.malaysiakini.com
Prime Minister Najib Abdul Razak is putting the country at risk by hinging the reduction of national debt percentage on the growth of gross domestic product (GDP), said Shah Alam MP Khalid Samad.
“BN is putting the country in a precarious situation. Everything will depend on the economic performance of one year. Everything hinges on next year’s (growth).”
Khalid was responding to Najib’s Oct 3 statement on Google Hangout that the country’s debt-to-GDP ratio would not hit the 55 percent ceiling if the country can maintain a GDP growth of five to six percent next year.
The national debt projected in Budget 2013 has climbed to RM502.4 billion
or 53.7 percent of the GDP, from this year’s 51.8 percent. Khalid (right) expressed doubt that Najib would be able take concrete steps to reduce the national debt and at the time, stimulate the economy.
“Do not be surprised if next year he (Najib) justifies that Japan and US have a larger debts than their GDP,” he told a forum on the federal budget in Petaling Jaya last night.
Also present was Lembah Pantai MP Nurul Izzah Anwar and Seri Setia assemblyperson Nik Nazmi Nik Ahmad.
‘Political competition’
According to Nik Nazmi, the political competition now is no longer between the “government and opposition” but between “the government and the government-in-waiting”.
Nik Nazmi also described concerns about too much politicking in the country as inaccurate, arguing that this was normal when two political blocs compete to prove which is best in forming the government. “We are seeing the emergence of political situation that is more competitive,” he said.
Before the forum, PKR president Dr Wan Azizah Wan Ismail launched a book entitled ‘Pendedahan di Parlimen: Dasar dan Cabaran Malaysia‘ (Expose in Parliament: Policy and Challenges of Malaysia). The book details the research work done by the think tank, Political Studies for Change, and edited by its Executive Director Ooi Heng.
Still playing with this fallacy of Debt/GDP ratio…
Present Finance Minister’s profligacy paving
the way for IMF-World Bank-ECB-style
“structural adjustment” polices
and Greek-style “catastroika”?
http://topdocumentaryfilms.com/catastroika/
This calls for Hishamh come to the rescue. Regardless of disagreement among all of us, his contributions are very valuable. Hishamh is far better than Bill O’Reilley. Jon Stewart has crowned Brian as the mayor of Bullshit Mountain.
Over to you Pak Bean.
P.S : Don’t remove this youtube link. It’s a good highlight
It’s not a question of when we are hitting the 55%. Malaysians are worried when the 55% is out for discussion. Formally Malaysians are not aware of such terminology. For all we know and with the kind of track records in accountability and transparency of our BN government we may already be over the 55%. A well balanced government will not run us aground. This is a clear sign that all is not well and that Malaysia has been poorly managed for the past 55 years.
Now, the question is do we want another 55 years of BN, do we have another 55% for them to mismanage?
You mean, I have to talk about this again?
____________
Yes, because many of us think you are overly optimistic about the government’s ability to manage the economy. You have to be more critical about national debt policy, for example, as I am sure your clients are guided by your advice.–Din Merican
If like Greece, and now Spain, our local authorities and State Governments run out of funds like our SEDC’s, Malaysia’s finances will tank like a Scorpenes submarine in tropical waters.
The fact that some 90% of our national debt is to local funds and banks is no comfort. Guess what happened to Citibank, AIG, Lehmann Bros, Fanny Mae/Freddy Mac etc during America’s sub-prime crisis, when the shit hit the fan? And Northern Rock in UK?
Dpp
we are all of 1 Race, the Human Race
Here is another unfashionable piece from Isa.
Whenever a family or a country has debt it means one thing only… living beyond your means ie. you live now but somebody else (your children) down the road is left to pick up the tab.
Moral : the only debt/GDP ratio that is good is ZERO.
Do not listen to modern-day economists. Common Sense is a much better guide.
What risk? Capital flight followed by the plunderers flight. Time to upgrade and expand Bamboo River Resort for VVIPs?
Encik Isa, of course debt/GDP ratio = zero may be good but it is not fair for the present generation to pay for all the development and long-lasting infrastructure only to be enjoyed by future generations who do not have to contribute towards the construction costs. It is also not an efficient use of funds. Some debts earmarked for new development of infrstructure should be incurred so that future generations will have to contribute their shares too.
May i add – it is not just the ratio that concerns us, its the overall management of the economy interms of planning all the the way to the executions that justify the feeling of concerns.
There are a number of items which are highlighted but alas being pooh-pooh about (sheesh, atleast have the decency to come to parliment, mr PM aka FinMin alias Women…)
1- extension budget : it is becoming the norm, will there be one for 2013 and why? (i mean consecutive defisit is one thing but having extension and expansion of budget – even had a year where the gomen request it twice!)
2- Capex-to-Opex ratio : are we already a developed country? So that must explain why the Opex is 80+%, since we already ok, we just need to maintain only?
3- This one bothers me, the overall picture of the economy be it at micro or at macro level… The inability of the gomen to come forth and convince the general public. Mind you – there is a big difference of when do something; u get it wrong and u just dont know… Why is it that there is a preception that the gomen is the latter, like they lost the plot (oh, i do agree with Nik Nazmi – nope, too much politiking is not an excuse, it is competition mr PM, get used to it… Umm, running away and hidding is not getting used to it)
Unbelievable, So we have come to this – bonus 1/2 month on dec and the other half jan next year i believe… Lets see how that will last, oppss..why suddenly the urge for maggi mee special..?.. Hmmm… Let see, Mamak order please!!!
Tuan HUSSIN : Two points come to mind…
1. If a country plans to embark on a major project that will benefit citizens – say a coast-to-coast highway – but which will be paid for by collecting toll from citizens, a debt taken for such a prioject is perfectly logical if it is to BE REPAID WITHIN A GIVEN TIME. Such borrowing does not really constitute a debt.
2. To have perennial debt as policy is indefensible.
Malaysia is one of the lucky countries in the world. For a relatively small population, we are blessed with enormous natural resources. Not only should such a country have zero debt, we should be holders of a very substantial savings funds.
So you see, Tuan, far from expecting our children to bear our current expenses, we ought to be like any good family and leave a substantial inheritance.
Hey.., good one Isa!
Yup, we should leave a legacy for our kids instead of a whole shitload of debt. Perhaps, guys like hussin aren’t very parent-like and aren’t able to sacrifice for their young. What’s that Malay proverb again?