Rafizi gave a sarcastic and patronising reply to Opposition Leader, Hamzah Zainuddin attempt to give a political spin to the growth statistic data in Parliament.
Economic growth will be the issue opposition intend to dwell on to gain political points despite knowing well there is an impending global recession and current inflationary concern.
It is expecting too much to pursue high growth now.
A market watcher suggested the revision for the 2023 budget to be tabled on Friday should focus on flattening the continuous decline on the state of the economy since 2016.
Among the concern of market and rating agencies is ever rising debt.
There are views that the debt level of Malaysia is comparably lower to other countries and advocate government spending through borrowing to tide through the impending global recession.
However one bad review from rating agency and the market will come crashing. Malaysia is not US or Japan or Western Europe or China to be compared to or using their policies for justification.
At about 60% debt (debt ceiling raised by Muhyiddin from 55% to 65%), Malaysia debt to GDP ratio is lower than Singapore but Malaysia is not a financial centre with free flow of capital. Inflow to buy ringgit is not as continuous as the outflow to other currency.
Noticeable from the chart that debt is contiously rising.
What growth 2022?
The recent self-praising by the PN side and pro-Ismail Sabri UMNO supporters on the 8.6% GDP growth is misleading.
It is necessary to comment and put the status on the growth of the Malaysian economy in the right context.
The gloating comment left economic watchers gasping with awe to the sheer naivety in their understanding of economics.
The growth for 2022 comes about from a low base after negative growth for 2020 and dismal growth for 2021.
It needed an equivalent of almost 2 years of prime priming of RM600 billion in which Muhyiddin government may have blatantly squandered to finance PN's GE15 warchest.
It was both the Covid-19 pandemic and his bad handling for ulterior motive that detoured Malaysia from its destined growth path (see chart above).
It is a long held view that Malaysia is undergoing the long term effect of Mahathirism and his politics is showing its toll.
Global recession concern
An analyst suggested private sector to invest and pump prime the economy. The suggestion only indicate government's limited capacity and the level of confidence on the forecast does not seemed high.
Growth should not be priority but food. More so, should the Ukraine war burst into a nuclear war and God forbid, World War 3 breakout.
A hint of the possible budget revision is touched by Deputy Finance Minister, Dato Ahmad Maslan in Parliament yesterday (refer to You Tube video here from 1:42).
His post Parliament press conference here stressed on debt reduction management. The likelihood Anwar Ibrahim will table a revision to reduce debt to avoid a bad review from rating agencies.
He would likely reduce budget. Spending maintained by pursuing a more efficient fiscal management and introduce targeted subsidy.
Most likely, there will be a serious effort to reduce waste, and leakage, improve good governance and pursue on corruption offenders. All from past Buku Jingga election manifesto of Pakatan Rakyat.
It reminded of sister's blog Another Brick in the Wall reply to then Minister of Finance 2, Husni Hanazlah challenge to show where to reduce budget.
A list of 100 was posted with combating corruption taking the bulk of the list.
Growth for 2023 and beyond
The forecast for 2023 with a budget constrained by interest repayment on debt nearing the 15% limit is expected to slowdown significantly and its between 4 to 5% depending on how the budget works out.
For what is worth, Edge Weekly commentary on GDP growth for 2023 and beyond below:
Prior to the 4Q2022 GDP data release on Feb 10, Ndiamé Diop, World Bank Group country director for Brunei, Malaysia, the Philippines and Thailand, had spoken about the need for Malaysia to step up strategic reforms and investments to lift average annual growth to 6%, from 4% now.
Digitalisation key to lifting productivity
Its worrisome that Parliamentarians are only concerned with playing politics and only a handful understand and discuss pertinent economic issue. Wong Chen recent comment for Petronas IPO failed to understand the economic risk beyond the political rhetorics for accountability, transparency and good governance.