I was shocked when Tan Sri Zeti, the Bank Negara Governor announced that the country's GDP had contracted by a massive 6.2% in the first quarter this year. And she went on saying that she did not expect the second quarter to be much better than the first. She blamed this contraction to weak external demand which led to our exports falling as major trading countries, especially the US (our largest importer by the way) slowed imports demand.
Dato Seri Najib also said that the Government is revising its forecast for the year to a contraction of between 4% to 5% compared to previously of between -1% to 1% growth for Malaysia. And he rightly said that private investments well more than 25% compared to last year whilst foreign direct investment fell by more than 50%.
Now, that is a massive reduction in the country's economic growth! And based on all these reports, Malaysia will go in a technical recession in about a month's time from now. Totally different from what the officials announced earlier oon.
First things first! I wonder, seriously wonder, why, with all our experts ie in Bank Negara, EPU, MIER (Malaysian Institute of Economics Research), ISIS and so on, these experts can still get it totally off target and wrongly advised the Prime Minister. Are they really doing their work and doing proper research before happily announcing and advising people about our country's economy.
And I have to say this, when these researchers get it wrong because of whatever reason (including being negligent or just plain ignorant), they make their bosses look bad. And these bosses include the Bank Negara Governor, the Finance Minister and ultimately the Prime Minister. And because these people were wrongly advised, they also happily wrongly announced these information to the public, including giving a false sense of security and hope to the rakyat that the county will ride out the economic issues without much problems.
I know many of my friends who were oblivous to the economic problems in US and other countries around because they said Malaysia is so far cushioned from it, and based on the minus 1% to plus 1% growth, they felt Maalysia should weather the economic problems well. Well, I know now that many of them are feeling deflated and are seriously not spending now because of the recent announcements.
I would like to see the officers and researchers to be truthful for once. If we are headed into a deep recession, then say so. Tell your bosses that so that they can tell the Rakyat. And we can brace ourselves to face the recession. And if we are only going to see some recovery only in 2010 or 2011 instead of, and in the words of the Bank Negara Governor " second half of 2009 supported by the fiscal stimulus measures and enhancement in access to financing", then you have got to be open and say it.
I actually agree with Tan Sri that the fiscal stimulus spending will bring some positive impact. However, I wonder if that alone is enough to make a significant impact to the country's GDP. Personally, I do not think so as Malaysia still relies heavily on exports and the US market especially. And I do not see the US market recovering in the short term as more and more bad news leak out. Only today, I got the news that General Motors , one of the big three automakers which hires thousands of workers in the US, is filing for bankruptcy protection.
I am genuinely concerned. The rakyat needs to be told and be given explanation how and what to do when the country goes into recession. The Rakyat also deserves to be informed accurately of the forecast and prognosis that are done accurately and correctly about our country. And to get that is nothing more but sheer hard work and research to get the information by our so called experts.
The Prime Minister and others are only as good as the information these so called experts give to them. Give them the right information, they can process it and tell the people. Give them the wrong and inaccurate information, then these experts are not just lying to the Prime Minister but are doing a disservice to the Rakyat of Malaysia.