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KUALA LUMPUR: The RM7 billion economic stimulus package is just the start of more measures Malaysia plans to introduce to keep the economy growing and competitive amid a tougher global environment.
"This policy response is the first package. It's important to note that there's still more to come," said Datuk K. Govindan, head of the secretariat for the National Economic Council. The council, comprising ministers and representatives of the public and private sectors, meets weekly to discuss ways to improve the economy. Its feedback contributed to the stimulus plan announced on Tuesday. "We continue to debate and measures will be considered and implemented, as and when," said Datuk Seri Nazir Razak, a council member and chief executive of the CIMB banking group. On whether RM7 billion would be sufficient to stimulate the economy, Nazir said the government needed a reserve in case the global scenario worsened. He added the signs pointed towards a bottoming of the global financial crisis. The council was working on various strategies that could quickly be adopted should the crisis worsen and the country's growth fall below 3.5 per cent next year, said Govindan yesterday. Nazir said the government's response to the crisis was "well directed" in terms of fiscal expansion, consumption stimulus, investment inducements and creative ideas on the financial management of its assets. The stimulus package was what the country needed now, he said, adding the council also looked into longer-term structural changes to the economy. "Future work will include structural issues, because a crisis always gives you space to make changes," Govindan said, adding that working groups in the council were discussing ways to make Malaysia more attractive to foreign investments. He said liberalisation of the services industry, particularly in the legal, medical and medical tourism space, would be a top area of focus. Besides trying to attract more investments from China, India and the Middle East, Malaysia would also look into Russia. Nazir said the government had demonstrated its dynamic handling of the economic situation. Not only had it taken steps to ensure that the RM7 billion would be spent, it had also demonstrated better spending management. "We now now have a budget with a realistic set of assumptions, and that's very important for the private sector." - nst
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