Prime Minister Najib Razak said his government will be launching seven huge projects as part of the Economic Transformation Programme to boost economic growth, but analysts were unsure that the trickle-down effect would be immediate enough to reverse the slowdown in the second half of this year or even next year.
"Big projects usually have long gestation periods. Just because you unveil the project next week, it doesn't mean GDP growth will immediately. There is the planning stage, the tender stage, the financing stage and so forth," a research director at a lrge local brokerage told Malaysia Chronicle.
According to Najib, the seven projects are part of the 131 entry point projects unveiled in the ETP.
"We are ready to launch seven new projects which I will be announcing soon. There are some major projects which will provide a huge catalyst for the market and the economy," Bernama quoted him as saying at the Asean 100 Leadership Forum 2010.
| The ETP launch - pie in the sky |
"If we have that kind of projects, it will add 0.6 to 0.7 per cent to the gross domestic product," he said.
The ETP aims to increase Malaysia's Gross National Income to RM1.7 trillion and create some three million jobs by 2020. The ETP needs RM1.4 trillion, of which, 92 per cent will come from private investments.
The ambitious plan was unveiled last week and has been heavily criticized by both financial analysts and political rivals alike. Their biggest concern was how the government would secure sufficient funding to carry through the projects.Till now, no financial details have been announced.
So far, most of the mega-projects undertaken by the government have turned out badly, with massive cost overruns and dogged by corruption scandals. Some of these include the RM12.5 billion Port Klang Free Zone financial debacle and the Bakun Dam, which Transparency International has described as a monument to corruption.
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