Malaysia on the move - aims to expand economy on global scale - Statistical Data Included

Business Asia, June, 2001 by Nadia Cameron

"The business community has welcomed the measures as it will create a more conducive business environment and will enable investors to plan ahead and make investment decisions over the longer-term," he said.

Although Austrade's Williams agrees the capital control changes and the Eight Malaysia plan are both positive signs of the Government's commitment to strengthening the economy, the bigger issues which will determine its elasticity will be its survival through the US downturn and the country's development of and diversification into new industry sectors.

"The Eight Malaysian plan is a very good indicator of where the Malaysian Government expansion preferences are. This is a good thing. The down side is that to deliver that, they'll (the Government) will have to be very lucky -- it assumes growth rates that are highly unlikely to be achieved, and presents an over optimistic view of the world," he said.

"The bigger picture is the country's growth of economy in the face of the US downturn. How Malaysia rides out this downturn will be a key issue. Malaysia is very dependent on the US and its exports of chips and IT components.

"Secondly, Malaysia is keen to develop its agricultural sector, which is largely in palm oil. This, however, is a depressed market. Lastly, Malaysia's economic success and growth in foreign investment will be affected by publicity. Who knows what will happen with the leadership?"