Thursday, February 12, 2009

How Malaysia Deals with the Downturn

In January alone, America has seen 600,000 jobs vanished into thin air. Global car sales have gone down in the vicinity of 40%. Airlines around the world have reported reduced travels. Oil price has been low floating in the average of $30-odd per barrel, forcing small independents to minimize their losses and cash out, also rendering 10% of rigs unoperational. Some have been cold stacked (after being re-activated with the hype of $140-oil). The frenzy of building massive fleets of boats and rigs have ceased. Shell announced its first quarterly loss in 10 years last quarter of USD2.8B. Only 2 industries were reported to have grown in the US last year, video games and alcohol. Retirees are forced to continue to work, fearing that their savings would not be sufficient to weather this rough storm.

In Malaysia, we are not so worried about the economic downturn. We are insulated from the rest of the global community. "Constitutional crisis" and "judicial reform" take center stage and make headlines. Metro continues to be the highest-selling circulation in the country. By-elections seem to be trendy these days (no disrespect intended for a couple of Yang Berhormats who passed away). As Yang Berhormats, it's acceptable to vacate your seat to give way to your husband. It's also acceptable if you intend to switch alliance, get caught in a sex scandal or other reasons.

Malaysia will soon become net-importer of petroleum. This means that we would be consuming more oil than we are producing. In lieu of foreign exchange, the cost to purchase oil per barrel from foreign countries would be enhanced. How would this affect the government's revenue to continue to operate? We have a cornucopia of resources and industries available but are we taking full advantage of these? Are we ensuring that subsidies are not hurting our bottom line?

Are we committed to improve the education in this country to beef up our human capital in the years to come, not just constructing empty schools with an ill-prepared teaching work force which scorn teaching our kids in English? Do our graduates pass muster or are they too concerned of their rights to be involved in politics? Are we not worried of the 100,000 unemployed graduates and many more retrenched recently from factories? Are we complacent with our universities ranked in the top 200? Are we not troubled that Vietnam would overtake us in GDP by next year? Don't even mention football.

It is a conundrum that many of these issues receive little, if any, attention. Maybe if we dish out enough dato'ships, the problems would diminish and eventually rectified.

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