Anwar predicts doom for Najib's plan

By Rahmah Ghazali - Free Malaysia Today

KUALA LUMPUR: Opposition Leader Anwar Ibrahim is not impressed with the 10th Malaysian Plan (10MP), saying there is little difference between this blueprint and its “failed” predecessors.

According to the Permatang Pauh MP, the government has always over-projected the Gross Domestic Product (GDP) and the new plan does the same.

Prime Minister Najib Tun Razak set a six percent growth for the GDP and aimed to reduce deficit from seven to 2.8 percent.

Najib's plan was given the thumbs up by certain quarters, but Anwar, a former finance minister, felt that it was "just another billion-ringgit announcement.”

"In terms of thought process, 10MP is nowhere different compared to the previous economic plans although our financial situation is now at crossroads," he added.

For instance, explained Anwar, the Eighth Malaysia Plan (8MP) announced by former prime minister Dr Mahathir Mohamad projected 7.5 percent growth for the GDP for 2001 to 2005.

"However, throughout that period, we only managed to achieve 4.7 percent," he said.

When Abdullah Ahmad Badawi took over, Anwar said the situation worsened when the former premier demanded national oil company Petronas to fork out RM235.6 billion to sustain the economy from 2006 and 2009 under the Ninth Malaysia Plan (9MP).

"But the economy only managed to grow at an average of 4.2 percent while in the plan, they projected six percent for the GDP," he said.

Since its establishment in the 1970s, Anwar said Petronas has paid a total of RM431 billion to the government and 55 percent of its revenue has been spent "without any impact on our economy”.

"In other countries, our dependency on debts could be reduced if a government-owned company contributed even 45 percent of its revenue," he added.

Malaysian being left behind

Malaysia, he said, is now trailing behind other developing nations such as Brazil and neighboring Indonesia.

"Brazil, which just emerged as a new economic power is now leading when it comes to reducing public debts. Malaysia is too addicted to debts,” he added.

The opposition leader noted that Indonesia has also made an effort to reduce public debts, bringing the figure down from 77 percent in 2001 to 29 percent in 2009.

Anwar also pointed out that Malaysia's financial situation was not like this between 1991 and 1998 when he was in the cabinet.

"That was because we realised that the burden should be reduced so that we would not burden the next generation," he added.

Quoting the International Monetory Fund's (IMF) findings on Malaysia's national budget for 2009, Anwar said the report indicated that the country's deficit could hit a “chronic level” without help from petroleum sources.

"In 2009, the budget deficit reached 7.4 percent of the GDP although it was expected to be reduced to 5.3 percent for the year 2010," he said.

He added that it was not only that the budget could not be balanced out at the end of the 8MP period, the government was still tangled in a deficit problem.

Failed twice before

"When the government announced the 9MP, the government once again promised to reduce deficit by controlling government spending.

“They had aimed to reduce the deficit to 3.4 percent of the GDP by 2010 even though the 8MP target was not achieved,” he said.

"That is why we are looking at this matter seriously because the government has failed twice in a row, and now they want to reduce the deficit for the 10MP as well," he added.

Shifting his focus to Foreign Direct Investment (FDI), Anwar revealed that the country has only received RM46 billion in 2008 and RM22 billion last year compared to Indonesia's RM50.6 billion (2008) and RM37.9 billion (2009).

"What disappoints me the most is while Indonesia is enjoying the increase of average income of 10 percent between 2007 and 2009 - Malaysia is still struggling with high-cost of living with only 4.7 percent increase of average income for 2009 and 6.3 percent for 2008," he added.

"Now we are competing with Thailand and Vietnam. Soon after this, the Philippines too will leave us behind if we don't improve our economy with more drastic and realistic measures," he added.