Malaysia to go downhill starting October 6 2012

TOTALLY IRRESPONSIBLE! “True debt” as of December 2011 was RM573 billion, or a whopping 67 percent of the GDP. In 2009, these hidden debts totalled RM84 billion, which increased to RM117 billion in 2011 ... the last two administrations have added more debt in six years than what took 48 years after Merdeka to accumulate! Full story below...

'Hidden debt' edges M'sia closer to the brink

While the federal debt on paper inches closer to the 55 percent of GDP threshold, senior lawyer Tommy Thomas says the “true debt” as of December 2011 was RM573 billion, or a whopping 67 percent of the GDP.

Previously, the federal government had vowed not to exceed the legislated debt ceiling of 55 percent of GDP.

In a paper prepared for the International Malaysia Law Conference 2011 today, the corporate governance specialist said this included contingent liabilities such as government guarantees and “off balance sheet” borrowings.

“In 2009, these hidden debts totalled RM84 billion, which increased to RM117 billion in 2011.

“Having regard to the crisis involving Greece and other European nations over sovereign debts, this is highly irresponsible,” Thomas said.

The lawyer, who is also a senior consultant to the United Nations Development Programme on corporate governance, said Malaysia’s debt has nearly doubled, compared with six years ago.

In 2005, under then-PM Abdullah Ahmad Badawi, the national debt reached RM229 billion.

“But in the six years, it nearly doubled to RM456 billion, representing 52 percent of the GDP.

“Thus, the last two administrations have added more debt in six years than what took 48 years after Merdeka to accumulate!” the paper states.

In his presentation, Thomas acknowleged that Malaysia did well in handling the 1997 financial crisis which was essentially caused by “excessive corporate borrowing”.

“Holistic measures were taken and it was the most successful turnaround in history, costing taxpayers only 2.56 percent of the GDP. It was a really cheap rescue effort,” he said.

Golden years of the NEP

Also speaking at the session on 'Asian Landscape: What Next?' was economist Terence Gomez, who said that compared with countries like South Korea and Taiwan, Malaysia has taken the wrong route.

“The first 10 years of the National Economic Policy (NEP) were the golden years... but the turning point was the designation of trade unions in 1981 and the neo-liberal ideas, including privatisation, deregulation, etc,” Gomez said.

He said the application of affirmative action in business, too, was a factor.

The government employed affirmative action in its focus on education in the early years of the NEP and this positively impacted the economy through the creation of a new middle class.

“But affirmative action in business (is) selected patronage, which is not beneficial to the economy. That's where we have gone wrong.

“We are, however, not that bad and can bring in institutional reforms to put this economy back on track,” Gomez said.

Also on the panel was CIMB chief executive officer Nazir Razak.
***************************************
Under the reading of Feng Shui and prediction through Mayan Calendar, Najib will pull Malaysia downhill starting from October 6 2012.  So are we prepare for the coming storm?  
Gift of mouth is mere word.  So stop being an idiot who only idolizes on lies.  When the truth will drown us.