Dr Mahathir admits Malaysian economy may be in trouble

Malaysia may slip into a double-dip recession if European countries face a similar slowdown, said Tun Dr Mahathir Mohamad.

The former Prime Minister said there were emerging signs of a double-dip recession hitting European countries and this would indirectly influence the Malaysian economy.

"I just returned (from England). In Europe (a double-dip recession) is imminent. If that happens, we may also be "infected", he told reporters after witnessing a contract signing agreement between Iris Corp Bhd and Koperasi Atlet Malaysia Bhd here Thursday.

Dr Mahathir was commenting on predictions made by economists and analysts that a double-dip recession may occur in the second-half of this year and whether Malaysia would suffer the same fate.

While saying the government had in place several economic plans and adopted progressive measures like the New Economic Plan, Dr Mahathir said it would, however, be difficult to predict the future as whatever occured overseas would have repercussions on Malaysia.

"Government is doing a lot of things but we cannot predict (the future) as external developments do affect us," he said.

Prime Minister Datuk Seri Najib Tun Razak said on Tuesday that Malaysia may face a double-dip recession in the second-half of the year prompted by external factors.

A famous banker also said recent data emerging out of the United States and Europe pointed to a possible global economic recession.