Menteri Kewangan Yang Terbodoh Di Rantau Asia

Majalah Finance Asia melantik Najib Razak sebagai Menteri Kewangan yang paling bodoh di Asia.

Ranked No 12 : Najib Razak, Malaysia

Last year was a very challenging year for the Malaysian economy. The country suffered a double whammy of political scandal that enveloped state fund (1MDB) and PM Najib, who also happens to be Malaysia’s finance minister. 

1MDB first started to attract unwelcome attention in early 2015 after struggling to settle a RM2 billion ($563 million) bridge loan. 

The funding crunch was an embarrassment for Najib, who chairs the fund’s advisory board and expanded its remit on coming to office in 2009, to help turn Kuala Lumpur into a financial hub.

Then The Wall Street Journal reported that nearly $700 million had been transferred to the prime minister’s personal bank account from the Saudi Arabian royal family, prompting a series of investigations. 

The identity of the donor and the reason for the donation was never disclosed, but it triggered demands for Najib to step down and cast doubts over about the country’s commitment to good governance. 

The long-running political crisis has taken up time that could have been better spent addressing the country’s acute economic troubles and made Malaysia appear even less attractive as an investment destination.  

According to Moody’s, foreign investors withdrew approximately RM24.5 billion ($5.83 billion) from the country in the third quarter of 2015. The ringgit also depreciated by 19% last year to its lowest level since 1997.

In response to falling oil prices and weakening exports, the prime minister presented a revised 2016 budget plan in January. 

The "recalibrated" budget sets a minimum price of $25.

Moody’s estimated that Malaysia’s fiscal deficit will likely widen to 3.4% of GDP if the oil price averages $34 per barrel. 

Other economists think the fiscal deficit has the potential to blow out to 4% of GDP if things stay the same.

My comments :

In a previous post on "recalibrating the Budget 2016" I suggested two things which the gomen has implemented.

1. My first suggestion was to 'put more money in peoples' pockets'. Najib has repeated the exact same words in his 'recalibrated Budget' statement. (Err ..my advice is free. Just read my blog. No need to pay RM7 billion.) 

However instead of cutting taxes and removing red tape (my suggestion) what they have done is reduce the employees EPF contribution from 11% to 8%. 

Yes indeed this will put an extra 3% of wages and salaries into the peoples' pockets. But this is from the peoples' own savings. This is their own money lah. This is their 'simpanan hari tua'. You are just making people spend their own savings. That is not a clever thing to do.

2. My second suggestion was to redo the Budget at an oil price of US25 per barrel. This too they have done. The oil price is now at US32 per barrel. 

So US$25 per barrel is a conservative number. 

What this means is if the oil price goes beyond US25 per  barrel it will become a bonus. They can put that extra money into a secret bank account in the Cayman Islands - under the name of the Minister of Finance Inc. for example.  Ha ha.  Just kidding.