Economics, Politics and Public Policy in East Asia and the Pacific
Author: Shankaran Nambiar, MIU, Malaysia
The Najib government has given renewed focus to Malaysia’s international economic relations, including liberalisation and increasing interaction with the global economy.
This approach is understandable for a small, open economy that is particularly dependent on export-driven growth, and faces considerable pressure to attract FDI and increase its exports. Read more…
Author: Shankaran Nambiar, MIU, Malaysia
The present and future quality of Malaysia’s human capital is of considerable concern for the country’s policy makers.
Human capital is not improving as it should, and it threatens to constrain Malaysia’s growth objectives. Read more…
Author: Shankaran Nambiar, Manipal International University, Malaysia
As the US loses its AAA rating, and Japan takes a slide to AA-, can the Malaysian economy hold its candle in the global storm that is brewing?
In what is an already gloomy environment, there is no doubt that the weather ahead is likely to turn grey, and Malaysia’s credit rating slipping from A+ to A in early September 2011 is proving an ominous sign. Read more…
Author: Shankaran Nambiar, Manipal International University
The recent downgrade of the United States’ credit worthiness by Standard & Poor (S&P) rocked financial markets around the world, Malaysia’s included.
Yet a strange sense of confidence pervades Malaysia’s market observers. The impact of the downgrade by S&P from a rating of AAA to AA-plus is thought to have limited impact on the Malaysian economy.
Author: Shankaran Nambiar, MIER
Malaysia’s New Economic Model (NEM) is a framework that promises to bring the country out of its middle-income status, and push it into the realm of a high-income economy. The NEM proposes to do this through eight Strategic Research Initiatives (SRIs). These SRIs include re-energising the private sector, developing a quality workforce, and creating a competitive domestic environment. Growth is also considered, both in terms of enhancing the sources of growth and ensuring the sustainability of growth. Other initiatives target the public sector, affirmative action and building Malaysia’s knowledge-base and infrastructure.
Given the multiplicity of the SRIs, if one were asked to select the key factors, what would they be? Read more…
Author: Shankaran Nambiar, MIER
Malaysia’s New Economic Model (NEM) serves to address two crucial issues that confront the nation. First, Malaysia for some time now has had its feet caught in the ‘middle income’ trap. It is now keen to graduate to a high income status, joining the likes of Singapore, Taiwan and Korea. The NEM takes this role seriously.
Second, the Malaysian economy has just recovered – and admirably, one might add – from the recent global financial and economic crisis. As if in answer to the lessons of the crisis, the NEM constitutes an attempt at designing a rebalancing strategy. Read more…
Author: Shankaran Nambiar, MIER
China has come to occupy a prominent position on Malaysia’s trade agenda over the past few years and is now Malaysia’s fourth largest trading partner. China currently accounts for about 11 per cent of Malaysia’s global trade, lagging behind the likes of the US, Japan and Singapore.
This was not always the case. Between 1995 and 1999, only about three per cent of Malaysia’s exports moved towards China. Today, about ten per cent of Malaysia’s exports are destined for China. Only about two per cent of imports came from China in 1995, but more recently they have shot up to close to 13 per cent. Read more…
Author: Shankaran Nambiar, MIER
The ASEAN-India Free Trade Agreement (AIFTA), which has been concluded after protracted discussions, is a strategic event that holds promise for both parties. The agreement is noteworthy as it completes ASEAN’s links with Asia’s two major emerging powers and two of the fast growing economies in the world, China and India. The FTA signals India’s readiness to contribute to the development of the region, and seek benefits from the process. There is no doubt that ASEAN welcomes India’s involvement in the region. A quick scan of recent trade figures, precisely because they lack lustre, suggests that India is looking beyond the present in concluding this agreement. This gives cause for optimism.
India’s trade with ASEAN has not been spectacular. India has been running a deficit with ASEAN in the last decade, and the deficit has been growing. Read more…