Latest news with #RM20bil
The Star
13 hours ago
- Business
- The Star
13MP bold step to grow Malaysia's economy, says Amir Hamzah
KUALA LUMPUR: The 13th Malaysia Plan (13MP) is a bold step forward to grow the nation's economy to ensure opportunities for all Malaysians, says Datuk Seri Amir Hamzah Azizan. The Finance Minister II said that the approach taken under 13MP would help achieve the aspirations under Madani economy. "What we want is that what is done though the 13MP reaches and is felt by the rakyat. "This can be seen from what was tabled by the Prime Minister," he told reporters at a press conference in Parliament on Thursday (July 31). He said that the 13MP represented the collective aspirations of the nation, which required bold measures for its realisation. "The approach taken will spur and grow the economy and find ways to increase opportunities in the country to that they are translated into opportunities for our people to ensure better employment in the future," he added. Amir said 13MP was extensive and covered various aspects of the economy, including social and environmental wellbeing of the nation. He said that a more detailed breakdown and explanation of the 13MP would be done in due time. Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi described the tabling of 13MP was at a crucial juncture with regard to the nation's overall wellbeing. "13MP tabled by the Prime Minister comes when the nation is faced with uncertainty in the global economy and disruption to the supply chain, which challenges our competitiveness and welbeing of the rakyat," he said at the joint press conference. He said that the high-growth high-value approach taken under 13MP involving strategic sectors would ensure not only sustainable economic growth for the nation but one that was inclusive and equitable. Ahmad Zahid also said that 13MP would help ensure that those undergoing TVET programmes would not only enjoy minimum wages for but premium wages based on their skills. "This will give added value to our educational ecosystem and marketability of the workforce in the country," he said. Ahmad Zahid, who is also the Central Disaster Management Committee chairman, also said it was significant that RM20bil was allocated to flood mitigation projects and AI-based early warning systems to better prepare the nation's when faced with such natural disasters. Ahmad Zahid, who is also Rural and Regional Development Minister, said that the setting up of a Halal Commission and halal parks in Melaka, Perak and Kelantan would help achieve the RM80bil halal export target under 13MP. Meanwhile, Deputy Prime Minister Datuk Seri Fadillah Yusof said that 13MP took into account the energy and water needed for the development of the nation while ensuring the welbeing of the rakyat. "The is why 13MP is taking a new approach our energy needs through more innovative mechanisms," he said. This includes managing the nation's energy needs including its efficient usage by the rakyat, he added. He said this included seeking better renewable energy sources, which are more environmentally friendly. "Currently, the country is relying on solar and other sources for energy and we need to find a more clean and feasible energy source. "That is why nuclear energy is an energy source which we are considering," he added. On Sabah and Sarawak, Fadillah said 13MP also ensured then continued development of the Pan Borneo highway including other infrastructure projects.
The Star
15 hours ago
- Business
- The Star
Extra RM20bil allocated for flood mitigation plans nationwide, says Anwar
KUALA LUMPUR: An additional RM20bil will be allocated for flood mitigation plans (RTB) nationwide, says Datuk Seri Anwar Ibrahim. The Prime Minister said this will involve 103 projects, including the Sungai Golok RTB in Kelantan; Sungai Gemencheh RTB in Tampin, Negri Sembilan and the Sungai Pahang basin RTB. Other focus areas are the Sungai Langat and Sungai Buloh RTB in Selangor; Sungai Baru RTB in Melaka; as well as the Sungai Johor basin RTB and Sungai Muar basin RTB in Johor. 'This can reduce the risk and impact of floods,' said Anwar when tabling the 13th Malaysia Plan in the Dewan Rakyat on Thursday (July 31). Anwar said that artificial intelligence systems will also be used to improve early warning systems, ensuring better preparedness during emergencies. 'Disaster risk management plans will also be included in State Structure Plans as well as Local Plans,' he said. The Prime Minister also stressed that the responsibility of tackling climate change and disaster risks cannot be overlooked. 'A National Adaptation Plan will also be introduced to handle its effects alongside strengthening the country's preparedness towards climate change,' he said.
The Star
17-07-2025
- Business
- The Star
The clock is ticking, the pressure is on
PETALING JAYA: Indonesia's new US tariff deal piles fresh pressure on Malaysia, which now risks being the region's highest-tariffed exporter to the world's largest market. Indonesia joins Vietnam in cutting better deals with Washington in the latest development of the tariff saga. Goods entering the United States from Indonesia are now subjected to a 19% tariff – down from the previously threatened 32% in April. Vietnam managed to slash its tariff from 46% to 20%, while the Philippines will see a higher rate of 20%, from 17% originally, but still lower than Malaysia's 25%. Meanwhile, Singapore and Thailand are still negotiating with the United States. A 10% tariff is currently imposed on Singapore. Thailand, which was slapped with a 36% rate, has recently submitted a fresh proposal to cut levies on many US imports to zero. For India, reports suggest the United States is working toward an interim trade deal with the country that may reduce proposed tariffs to below 20%. The new tariffs are due to kick in on Aug 1. While this means there is still room for further negotiations with the United States, the fact remains that Malaysia is staring at a relatively steeper 25% tariffs among its neighbours. SPI Asset Management managing director Stephen Innes said this situation should create urgency for Malaysia in its negotiations with Donald Trump's administration, noting that the country risks 'becoming collateral in a region that is rapidly aligning itself for tariff relief'. Innes cautioned that should the tariff remain unchanged, Malaysia's long-standing role as a regional manufacturing hub - especially in high-value sectors like electronics and precision engineering could be undercut as US-oriented foreign direct investment (FDI) toward 'more tariff-friendly neighbours'. 'If Malaysia ends up with the highest US tariffs in the region, the knock-on effects could be significant. From a trade perspective, Malaysian exports will become less competitive. 'However, the more serious concern is FDI,' he told StarBiz, adding that foreign investors assessing South-East Asia – especially under China+1 strategies – will factor in tariff burdens. Innes noted the redirection of new manufacturing investment has already played out in the past, with Vietnam emerging as a major winner due to faster trade deals and a more responsive policy posture. Should a deal fail to materialise, a 25% tariff could slash Malaysia's exports by RM20bil and shave 1% off gross domestic product growth, said economist Geoffrey Williams. 'Malaysia's best strategy is to cut all tariffs on US goods and work to reduce non-tariff barriers as much as possible,' he said. In return for a more favourable tariff deal, Indonesia agreed to buy US$15bil worth of US energy, US$4.5bil of American agricultural products and 50 Boeing jets. American exports to Indonesia will also be free of tariffs and non-tariff barriers. Sunway University economics professor Dr Yeah Kim Leng suggested Malaysia can likewise offer the same conditions (no tariffs on imports from the United States) noting that the country's import tariffs on US goods are already low – at around 6.1%. Yeah, however, said the more difficult demands for Malaysia to meet pertains to government procurement, halal requirements, investment in the United States and other non-tariff barriers. 'Given that Malaysia's exports to the United States are broadly similar to that of Indonesia's exports, the latter's lower tariffs will create a price disadvantage to Malaysian exporters, rendering Indonesia's exports more competitive in US markets,' he said. Moreover, Yeah also stated Malaysia's potential loss in market share in the United States market is likely to lower trade, investment and manufacturing activities unless the loss is offset by increased exports to other markets. Even so, the United States remains the single largest consumer market in the world, in terms of purchasing power and demand. On this note, Innes pointed out mitigation measures like market diversification -such as boosting intra-Asean trade – still cannot be 'a substitute for US market access'. 'Malaysia can try to redirect exports to Asean, for instance, but the scale and absorptive capacity simply cannot compare. It is a case of selling more into a pond when you have just been priced out of the ocean,' he said. Additionally, market diversification is a strategy that every other country is chasing as well. Meanwhile, some experts are not as bearish about the impact of Malaysia's higher tariff, arguing that its strong fundamentals will help cushion the blow in the long run. Although iFAST Capital research analyst Kevin Khaw Khai Sheng acknowledged that having a relatively higher tariff may lead to a dip in trade, capital flows and manufacturing competitiveness, he opined that these effects will likely be seen only in the short term of up to one year. 'In the longer term, Malaysia's role as a manufacturing base will remain intact, given the country's political stability, multilingual workforce and geographic advantages, which make shifting supply chains away from Malaysia not an easy feat despite short-term tariff pressures,' he said. Khaw said countries like Vietnam and Indonesia gave up a lot of ground by agreeing to grant full market access for US goods – a move that will ultimately hurt their domestic economies. He noted that Malaysia is already working on win-win solutions with the United States, as seen in the latest measure announced by the Investment, Trade and Industry Ministry (Miti) this week in tightening the rules related to US-origin chips. 'A win-win solution does not mean we have to open up our market entirely. 'Miti's latest measures on US sensitive technologies can also help us reach an understanding with the country without hurting our domestic economy,' Khaw said. Bank Muamalat Malaysia Bhd head of economics, market analysis and social finance Dr Mohd Afzanizam Abdul Rashid said Malaysia needs to perform its due diligence before deciding on liberalising the local economic sector. 'We need to be clear on our existing industrial policies especially when there is an element of protectionism. The last thing that we need is to succumb to the peer pressure when it comes to US tariffs,' he said. In the meantime, Universiti Tunku Abdul Rahman economics professor Wong Chin Yoong noted that when Indonesia imposes zero tariffs to US goods, it has to grant zero tariffs to Malaysian exports into Indonesia as well, based on the most favoured nation rule. 'Malaysia still benefits as long as the World Trade Organisation (WTO) rules are upheld. Vietnam and the country's other trading partners are members of the WTO. 'To some extent, this helps mitigate the adverse impact on domestic exports to the United States by keeping other markets open for our goods,' he said. For now, Innes said Malaysia should push for exemptions in sectors where the country offers clear value - semiconductors, green tech, palm derivatives —through targeted bilateral talks. 'Domestically, Malaysia cannot just rely on legacy advantages; it needs to double down on investor incentives, streamline regulations, and upskill labour to keep its edge,' he said.
Asia News Network
17-07-2025
- Business
- Asia News Network
Malaysia-US tariff talks: The clock is ticking, the pressure is on
PETALING JAYA – Indonesia's new US tariff deal piles fresh pressure on Malaysia, which now risks being the region's highest-tariffed exporter to the world's largest market. Indonesia joins Vietnam in cutting better deals with Washington in the latest development of the tariff saga. Goods entering the United States from Indonesia are now subjected to a 19% tariff – down from the previously threatened 32% in April. Vietnam managed to slash its tariff from 46% to 20%, while the Philippines will see a higher rate of 20%, from 17% originally, but still lower than Malaysia's 25%. Meanwhile, Singapore and Thailand are still negotiating with the United States. A 10% tariff is currently imposed on Singapore. Thailand, which was slapped with a 36% rate, has recently submitted a fresh proposal to cut levies on many US imports to zero. For India, reports suggest the United States is working toward an interim trade deal with the country that may reduce proposed tariffs to below 20%. The new tariffs are due to kick in on Aug 1. While this means there is still room for further negotiations with the United States, the fact remains that Malaysia is staring at a relatively steeper 25% tariffs among its neighbours. SPI Asset Management managing director Stephen Innes said this situation should create urgency for Malaysia in its negotiations with Donald Trump's administration, noting that the country risks 'becoming collateral in a region that is rapidly aligning itself for tariff relief'. Innes cautioned that should the tariff remain unchanged, Malaysia's long-standing role as a regional manufacturing hub – especially in high-value sectors like electronics and precision engineering could be undercut as US-oriented foreign direct investment (FDI) toward 'more tariff-friendly neighbours'. 'If Malaysia ends up with the highest US tariffs in the region, the knock-on effects could be significant. From a trade perspective, Malaysian exports will become less competitive. 'However, the more serious concern is FDI,' he told StarBiz, adding that foreign investors assessing South-East Asia – especially under China+1 strategies – will factor in tariff burdens. Innes noted the redirection of new manufacturing investment has already played out in the past, with Vietnam emerging as a major winner due to faster trade deals and a more responsive policy posture. Should a deal fail to materialise, a 25% tariff could slash Malaysia's exports by RM20bil and shave 1% off gross domestic product growth, said economist Geoffrey Williams. 'Malaysia's best strategy is to cut all tariffs on US goods and work to reduce non-tariff barriers as much as possible,' he said. In return for a more favourable tariff deal, Indonesia agreed to buy US$15bil worth of US energy, US$4.5bil of American agricultural products and 50 Boeing jets. American exports to Indonesia will also be free of tariffs and non-tariff barriers. Sunway University economics professor Dr Yeah Kim Leng suggested Malaysia can likewise offer the same conditions (no tariffs on imports from the United States) noting that the country's import tariffs on US goods are already low – at around 6.1%. Yeah, however, said the more difficult demands for Malaysia to meet pertains to government procurement, halal requirements, investment in the United States and other non-tariff barriers. 'Given that Malaysia's exports to the United States are broadly similar to that of Indonesia's exports, the latter's lower tariffs will create a price disadvantage to Malaysian exporters, rendering Indonesia's exports more competitive in US markets,' he said. Moreover, Yeah also stated Malaysia's potential loss in market share in the United States market is likely to lower trade, investment and manufacturing activities unless the loss is offset by increased exports to other markets. Even so, the United States remains the single largest consumer market in the world, in terms of purchasing power and demand. On this note, Innes pointed out mitigation measures like market diversification -such as boosting intra-Asean trade – still cannot be 'a substitute for US market access'. 'Malaysia can try to redirect exports to Asean, for instance, but the scale and absorptive capacity simply cannot compare. It is a case of selling more into a pond when you have just been priced out of the ocean,' he said. Additionally, market diversification is a strategy that every other country is chasing as well. Meanwhile, some experts are not as bearish about the impact of Malaysia's higher tariff, arguing that its strong fundamentals will help cushion the blow in the long run. Although iFAST Capital research analyst Kevin Khaw Khai Sheng acknowledged that having a relatively higher tariff may lead to a dip in trade, capital flows and manufacturing competitiveness, he opined that these effects will likely be seen only in the short term of up to one year. 'In the longer term, Malaysia's role as a manufacturing base will remain intact, given the country's political stability, multilingual workforce and geographic advantages, which make shifting supply chains away from Malaysia not an easy feat despite short-term tariff pressures,' he said. Khaw said countries like Vietnam and Indonesia gave up a lot of ground by agreeing to grant full market access for US goods – a move that will ultimately hurt their domestic economies. He noted that Malaysia is already working on win-win solutions with the United States, as seen in the latest measure announced by the Investment, Trade and Industry Ministry (Miti) this week in tightening the rules related to US-origin chips. 'A win-win solution does not mean we have to open up our market entirely. 'Miti's latest measures on US sensitive technologies can also help us reach an understanding with the country without hurting our domestic economy,' Khaw said. Bank Muamalat Malaysia Bhd head of economics, market analysis and social finance Dr Mohd Afzanizam Abdul Rashid said Malaysia needs to perform its due diligence before deciding on liberalising the local economic sector. 'We need to be clear on our existing industrial policies especially when there is an element of protectionism. The last thing that we need is to succumb to the peer pressure when it comes to US tariffs,' he said. In the meantime, Universiti Tunku Abdul Rahman economics professor Wong Chin Yoong noted that when Indonesia imposes zero tariffs to US goods, it has to grant zero tariffs to Malaysian exports into Indonesia as well, based on the most favoured nation rule. 'Malaysia still benefits as long as the World Trade Organisation (WTO) rules are upheld. Vietnam and the country's other trading partners are members of the WTO. 'To some extent, this helps mitigate the adverse impact on domestic exports to the United States by keeping other markets open for our goods,' he said. For now, Innes said Malaysia should push for exemptions in sectors where the country offers clear value – semiconductors, green tech, palm derivatives —through targeted bilateral talks.
The Star
22-06-2025
- Business
- The Star
Don't downplay seriousness of national debt
Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim must cease using selective framing and misrepresenting concepts to downplay the seriousness of the national debt or to claim undue credit. The public deserves transparency, especially amid rising inflation, an increasing cost of living, and growing economic hardship. Urgently needed are concrete, revenue-generating economic policies, not a continued reliance on tax increases and subsidy reductions that add financial pressure on the rakyat. Recently, the Prime Minister stated that Malaysia's new borrowings have decreased annually, from RM100bil in 2022 to RM80bil in 2024. He also claimed that consistent efforts have been made since 2022 to reduce the fiscal deficit from 5.5% to a projected 3.8% this year. However, this narrative attempts to obscure the actual increase in overall national debt by focusing only on the decline in new borrowing. The claim of a RM20bil drop in new debt over three years does not reflect the full picture. According to the latest fiscal and debt data released by Bank Negara Malaysia, the national debt continues to rise. Official reports, such as the Government Finance Statistics and the Economic Outlook Report, show that federal government debt exceeded RM1.17tril at the end of 2023. This figure rose to RM1.6324tril in 2024 and remained high at RM1.2476tril as of the first quarter of 2025. These numbers directly contradict the Prime Minister's claims and reveal a clear attempt to present a misleading version of the national debt status by selectively using statistics. National debt cannot be assessed by focusing solely on new borrowings. The total size of the debt, the debt-to-GDP ratio, refinancing obligations, and interest liabilities are all key structural factors that must be addressed. Suggesting that borrowing slightly less this year indicates meaningful fiscal improvement underestimates the public's understanding and concern. What matters most to the people is the actual debt burden carried by the country, not how the government chooses to interpret the data. If the debt continues to grow and interest payments increase, then the Prime Minister's remarks amount to self-deception and risk eroding public trust. Despite repeated assurances of fiscal reform and financial discipline, the Unity Government has yet to demonstrate genuine progress in reducing national debt or budget deficits over the past two years. Instead, it has expanded the Sales and Services Tax (SST) and reduced subsidies, effectively shifting the fiscal burden onto the public while failing to rein in government expenditure. Balancing the national budget should not come at the expense of ordinary Malaysians. The real crisis today lies in inflation and the rising cost of living. Yet the government has failed to introduce any substantial, revenue-boosting economic policy or reform plan. What the country truly needs are forward-looking policies that raise incomes, encourage investment, and create employment opportunities. Fiscal reforms must not be used as an excuse to add to the public's burden. Malaysians do not need more political packaging. What is urgently required are real, effective solutions that provide relief and restore confidence. Saw Yee Fung MCA Youth Secretary General
