Malaysian premier shrugs off looming threats to economy

 

(Financial Times) - A slowdown in the Chinese economy, plunging commodity prices and the looming end of US “QE3” quantitative easing might appear to be a perfect economic storm for Malaysia.

The commodity producer exports to China and has benefited handsomely from the cash that washed through emerging markets as a result of the US Federal Reserve’s aggressive bond-buying programme.

In an interview with the Financial Times on Wednesday, however, Najib Razak, Malaysia’s prime minister, played down the likely effects of the threats to growth coming from the world economy. As a leader fresh from an election victory, his confidence is understandable. But some might see it as misplaced.

Mr Najib insisted Malaysia remained on course to grow at 5 to 6 per cent annually and achieve the government’s target of joining the ranks of the world’s high-income countries by 2020.

Mr Najib was speaking during a visit to London, made as his government is settling back into office after the ruling United Malays National Organisation overcame the biggest-ever challenge to its power in May’s parliamentary elections. The opposition won 51 per cent of the vote, but Umno and its partners in the ruling coalition secured 60 per cent of the seats under Malaysia’s constituency-based voting system.

The prime minister pledged to accelerate economic reforms and show that the country could be modernised “from within” the existing political framework – a riposte to the opposition’s election claims that Malaysia needed a change of leadership after decades of unbroken Umno rule.

He said: “I want to prove the point that we can make changes from within. We can transform the government and the economy, as well as democracy in Malaysia.”

Read more and watch the video where he touches on electoral claims and the 'Chinese Tsunami' at: http://www.ft.com/intl/cms/s/0/d91bb880-e3f0-11e2-b35b-00144feabdc0.html#axzz2Y36hhDdz