Government's TOP 10 Recovery Strategies

Pic 01 (left) : Hmmm... is it Debit or Credit?
Pic 02 (Right): Boys, oh boy... you have a long way to go



Recession may not be a bad word. Japan, South Korea experienced economic disasters after World War II and Korean War respectively. WIth zilch and only armed with human spirit, both countries grew phenomenally over 3 decades since the 1950's.

TOP 10 Actions
Having seen all of the above, Malaysian Government can do wonders to turn around the economy:

1. At least a 9% budget deficit spending to compensate the weak aggregate demand of consumptions and investments. Note this must continue for at least 3 years, as threats of inflation is low due to liquidity trap situation which is an increase in money supply may not increase threat of interest rate hikes.

2. Keep interest rates low to below 2% ie many local banks offering rates at BLR less 2% with intention to stimulate loan demand.

3. Focus on infrastructure development in lagging states especially Penang, Johor, Kelantan and Trengganu. For eastern coasts states, consider high speed trains to link Johor Bahru to Mallacca and Penang mainland link to Kuala Lumpur. Conduct analysis of volume traffic taking PLUS highways in order to evaluate the feasibility of mammoth tasks.

4. Speed up development of internal cities Monorails or Multi-rails to improve public transport so as to substitute car purchases. Malaysians have the 3rd highest ratio of car per population in the world. Too much discretionary income spent on cars which leads to weak demand for other consumables like shopping, holidays, hairdos, fashion wears. Tap on local 27 million population leads to stronger domestic demand.

5. Offer 100,000 green cards per year to attract foreign talents from Indonesia, India and China. Please note its only 0.3% of population, so bringing in foreign nationalities will not bring political strains amongst races.

6. Liberalise SEVEN (7)states economy. Allow each state to focus on their areas of expertise in their own unique industries such as:

i. Selangor – focus on banking and finance
ii. Penang – focus on high end semi-conductors, fabless chips
iii. Kelantan – focus on Islamic Universities studies, don’t forget this is largely untapped market witn Muslim Population of 1.6billion worldwide
iv. Trengganu – bio-tech agriculture on tobacco, oil palm refineries
v. Johor – focus on Iskandar Project and ancillary industries supporting it
vi. Mallacca – tourism and patient-care tourism
vii. Pahang – resorts leveraging on virgin tropical jungle, have resorts living for high end customers. Open up and liberalise gaming-casinoes. Compete with Macau for Chinese tourists. Offer Air Asia free landbank in middle of Pahang as feeder line into its casinoes resort.

7. Note that Malaysian professionals overseas are reluctant to return. Offer ZERO tax income holiday for 3 years if they return, ZERO tax on car owned and ZERO stamp duties for homes they purchase above RM500,000. Malaysians likely to return for sentimental reasons like coming back because of Bak Kut Teh,Roti Chanai lepak corners, Satay.

8. Re-train and re-position 30% 1.1million civil servants to productive sectors like fisheries, cab driving. We have one of the highest civil servants:private section ratio in the world for a ‘free’ economy. A waste.

9. Offer licenses to foreign institutional funds to invest in Bursa Malaysia. Have in place, links to universities that supply Finance Graduates, Info tech capable of broad band communication worldwide, perks for foreign talents as expatriates.
The amount of economic turnaround is fantastic, but all go to waste with poor implementation! Thus governance is critical by setting up :
i) Economic –committee for each state. That will be 7states in Peninsular and still counting. Members should be from tycoons, university researchers with PhD in related fields – note special emphasis and invitation to foreigners to chair the meeting if no local PhD candidates (likely the case) are available.
ii) Transparencies in providing statistics. Beef up Economics Department and Bank Negara Malaysia to provide analysis. Make available online
iii) Interests rates decision should be based on at least 7 top economists in the country and by vote determine the direction.
iv) Everyday, and i repeat, everyday, share success stories of top entrepreneurs with heavy biased toward successful Bumiputeras. Change populace mindsets that its the people and not the government that make a difference in nation’s future. There are many, many successful Bumiputeras professionals and entrepreneurs, keep on if possible a million times a day to disemminate this news.

10. Stop politicking by making empty promises.

What it means for ACCA graduates?
To all my valued students of INTI College Subang Jaya, you see everything works for you and your future. You can capitalise on immense opportunities ahead when government stimulates the economy creating high value jobs. Its only YOURS when you become an ACCA graduate. The economy needs highly skilled intellectuals and professionals. So, work hard for 3 years and reap the rich rewards for next 30 years!

Invitation
All you ACCA candidates, your comments i.e. constructive comments on:

I) What the government can do?
II) Which industries are key?
III) What would you have done, if you are the CEO i.e. Prime Minister of Malaysia?