May 30, 2010

Malaysia Moves Toward Bankruptcy ?

BBB, 13th J. Awal = 28th May (Friday):

Despite the government assured that the economy of Malaysia grows 5 percent this year, but we were surprised to read papers today that Malaysia would bankrupted in 2019 unless steps taken to reduced the burdens. One of the proposals introduced by the government is to cut subsidies that government spent RM74 billion yearly. According to the proposal the cutting of subsidies could save 103 billion of debt in the next five years.

More surprisingly that the government in debt about RM326 billion and we Malaysians shouldered the debt 4.6% compared with Indonesia 2.7% and Philippine 0.2%. Before that the government had tried to conceal the debt and overcome and remedy the debt by introducing the GST (Goods, Service and tax) that by GST would get the higher revenue by increase the cost up to 20%. However many NGOs campaigned and against the GST that made the government withdrew the GST for a while.

By now we knew that the economy of Malaysia in sick situation. To remedy the sickness the government suggested to cut the subsidies and raise the tax and cost such as petrol price to go up by 10 to 15 cent in middle of this year. The price of petrol will increase every six months until 2014 when the price at the same level of market price, increase the electricity tariffs to those consuming over 200kWh, increase the price of food items such as sugar price to increase 20 cents per kilo every six month until 2012, toll rates will increase according to agreement, the government hospitals to increase outpatient treatment from RM1 to RM3 and the patient treatment will increase according to wards ( 1 – 3) from between RM3 and RM80 to between RM6 and RM160 and for the education the tuition subsidy to be abolish and no text book loans and no free public examination except only for poor students. The other items will increase accordingly, as the double increase of price the people suffer multiples. We guest the economic problem facing the government because the lack of revenue after the government lost five states (now four) especially Selangor and Penang that both states are considered the rich states and due the government spent lavishly as before especially to recapture the lost states.

The economic problems facing the government are very serious. Our question is, such very serious problems that will effect the whole people, why the government does not bring the above proposal to parliament rather than only Senator Idris Jala The Minister in the Prime Ministers Department delivered the issue by press statement ? The Federal government now is facing either sinking or floating. If the government does not increase the tax the government would trapped under bankruptcy that would sink the government and by implement the tax proposal the government would floating and could survive, but would facing the people in the next 13th general election.

Thank you.

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