Tuesday, 22 April 2008

Malaysian Economy: Gloom and Doom?

I realised that it is getting really fashionable in the blogosphere to criticise everything that is coming from the Government, up to a point that seems rather irrational. These include criticisms on the official outlook for the Malaysian economy. I have chanced upon many highly misinformed blog posts and letters to editor that argued how the government is misleading the public with fake and manipulated statistics and that the Malaysian economy is actually in deep-dung now; GDP growth should be recessionary, inflation should be closer to 20-30% and so on.

Everytime I read something like this, I feel a strong urge to do something and explain. Actually, I did write a reply to a letter published in Malaysiakini by some Dr Wong or rather on inflation statistics which was highly highly misleading. My reply was not published, but I can't fault them. My stance is unpopular. Not to mention boring. Who wants to read technicalities on statistics right?

Meh.

Just a minor point on manipulation of standard statistics and forecasts. The observers and users of these figures are usually professionals, investors, economists and technocrats, both locally and internationally. It is really not easy to manipulate them and not get found out. And the cost of such folly is great. If the government is really cheating us with manipulative statistics, trust me, we do not need a medical doctor to tell us so in a letter to Malaysiakini.

Anyway, I am attaching a table outlining the latest GDP forecasts (April) for Malaysia in the coming two years by a medley of private entities, from local-based research houses to international banks to IMF and ADB. Pretty close to the official forecast I would say.


The point is, the economy will be going through a rough patch going forward, with risks coming mainly from slowing global demand, ballooning commodity prices and political uncertainties. But it is really not all gloom and doom.

And yes, it is crucial to be critical, but let it be motivated by reason and not fashion.

Hmmm.

8 comments:

mekyam said...

Hi Elanor,

I drop by to thank you for compiling Azmi Sharom's pieces from the Star. Thank you!

Like your intellectual but quirky take on things. The stuffs on economics will probably glance off the top of my head, but I will be back! :)

Chewxy said...

awesome. you're back in form (oi come online.....)

Shawn Tan said...

Statistics can be made to show anything as it's interpretation of the data. That's why raw data is usually insisted upon in scientific reviews.

However high/low the economic forecast is, maybe the trouble is that it's not translating very well onto the layman. When normal people don't 'feel' the effects of an economic boom, you cannot really blame them for fearing a 'slow patch' can you.

Hafiz Noor Shams said...

I absolutely agree.

It's annoying to see those with little economic background starting to make conspiracy theory on how economic data recorded by the Bank Negara or the Statistics Department are being manipulated by the government.

Harrison bin Hansome said...

"My reply was not published, but I can't fault them.-Elanor

"I have written to Malaysiakini and some are not published. I guess Politikus would "chew' my articles before it reaches the editor. Remember, I was a bricklayer. Pity. Aiyooo.-Harrison

My stance is unpopular.- Elanor

"It's not about popularities dear Elanor, but about dialectics, and how good it is. You are doing fabulously so far. Only Jackie Chan's "Druken Master's" stance is far popular than yours. No hard feelings ok, am telling the truth". -Harrison.

Not to mention boring.-El

If it's boring, I wouldn't have been here.-Harry

Who wants to read technicalities on statistics right?"-El

"That is if the accuracy is nigh-substantiated, of course. but I WOULD like to have a drink with you sometime if you are in Malaysia. Oh yeah, a Cambridge coed surely won't date an underschooled bricklayer, agree?"-Harry.

Anonymous said...

The main street clearly do not feel the boom of "robust" Malaysia economy as portrayed by the GDP all this while. With the US keep printing more money to rescue the economy. We can all expect to see much worse global economy in the near future. Please google hyper inflationary depression or John Williams for more info of our impending melt down of fiat currency system. Let's enjoy while it lasts

Hafiz Noor Shams said...

anon,

2-4% is hardly hyperinflation.

Elanor said...

...

depressing more like it. i give up.