By Mohamed Azmin Ali
July 28 – It came as no surprise when the BN government blamed the global financial crisis on why our foreign direction investment (FDI) has plunged by a shocking 81 percent last year.
Trade Minister Mustapa Mohamed said that the “dampening” of FDI inflow into Malaysia reflected a trend where the world’s FDI in 2009 fell by 37 percent.
There is a huge gap between 81 percent and 37 percent, if our government knows how to do the math.
The figures reported in the World Investment Report 2010 by UNCTAD, a United Nations think-tank, which showed Malaysia’s FDI plunging to USD 1.38 billion last year, from USD 7.32 billion in 2008, is both ironic and telling.
Malaysia is now ranked sixth among the Southeast Asian nations on FDI inflow, losing out to ‘lightweight’ neighbours Thailand, Indonesia, Vietnam and even the Philippines.
The report has not only confirmed that we have lost much of our shine but it also reveals a grim picture in the pursuit to restore investors’ confidence and ‘sell’ Malaysia as a competitive nation.
Since Prime Minister Najib Razak took power last year, he has launched a series of ‘feel-good’ policies like the New Economic Model and the 10th Malaysia Plan, which were hyped up as people- and investor-friendly policy.
The truth remains that we’re still struggling to combat our ballooning budget deficit, which the government aims to narrow to 5.3 percent this year.
In spite of that, analysts are doubtful whether that figure is attainable after the government pumped in 67 billion ringgit last year for the two, largely ineffective, stimulus packages.
Najib has not really tackled the issue of how to increase the competitiveness of Bumiputeras; while race-based affirmative action policy remains and corruption as well as leakages in the government delivery system rampant.
The general public suffered the most with the recent ‘5-in-1’ price hike while tens of millions were spent to hire a public relations firm to boost up the PM’s image.
During this time, his wife enjoys a good time with her guest, Hollywood star Robert De Niro whom she said would help to clear “misconception” about Malaysia in the international stage (though the latter said that he was on a private visit, we have no clue whether the rakyat’s money is involved).
Compared to our northern neighbour, we did not see such a drastic decline in FDI in Thailand which suffered its worst political violence in recent months.
Furthermore, the Bank of Thailand has raised its economic growth forecast recently and expect the country to grow a healthy 6.5 to 7.5 percent this year.
Singapore, meanwhile, is set to become the world’s fastest-growing economy this year after the government announced that the growth will expand by 13 to15 percent.
And Malaysia? Our economy has been officially forecasted to grow 5.5 percent this year, though Najib himself would love to see a 6 percent expansion.
It looks as if Najib require some form of advice from his wife’s guest, Robert De Niro, to achieve this.