Execution is the KEY
Until a week ago, the absence of a `safety net’ or plan to cushion the country’s slowing economy as a result of the global rout had stirred great disillusionment. There’s no comfort in lingering behind the curve when our neighbours and many other behemoth nations were unveiling massive financial stimulus plans to re-energise waning economies, some with a promise of more to come. More so, when the pivotal question is not when the turmoil will hit us, but, to what extent.
As such, it was with great relief that the RM7bil Economic Stimulus Package was received on Tuesday, a day which had two firsts (there were many others, but two stick) - Americans voted in their first African American President in Senator Barack Obama and Malaysia’s Deputy Prime Minister Datuk Seri Najib Tun Razak made his first official stamp as Finance Minister - a post he took over just under three months ago.
The plan has sparked a debate on whether the size or quantum of the economic stimulus plan matches the problem the country is facing due to the cataclysmic fall in Wall Street which has reverberated to unsuspecting corners of the world.
As such, it was with great relief that the RM7bil Economic Stimulus Package was received on Tuesday, a day which had two firsts (there were many others, but two stick) - Americans voted in their first African American President in Senator Barack Obama and Malaysia’s Deputy Prime Minister Datuk Seri Najib Tun Razak made his first official stamp as Finance Minister - a post he took over just under three months ago.
The plan has sparked a debate on whether the size or quantum of the economic stimulus plan matches the problem the country is facing due to the cataclysmic fall in Wall Street which has reverberated to unsuspecting corners of the world.
But no matter how big the package – whether it’s RM7bil, RM10 bil or RM20 bil – the issue is – and this cannot be emphasised enough - its outcome lies humbly at the feet of execution. How fast will these measures be implemented? Mediocre execution leads to botched policies.
Providing some inkling as to the will to address this issue is the setting up of a Project Monitoring Unit (PMU) which will report directly to the Finance Minister on the progress of implementation.
A laudable move but could the Government walk an extra mile on that measure? As these measures are essentially meant to boost confidence, which has been visibly missing for awhile, regular updates or progress reports to the public can go a long way to appease the public. It will also set a fresh, no doubt, commendable and encouraging tone for the new leadership (end March 2009 and post Umno AGM and party elections).
A laudable move but could the Government walk an extra mile on that measure? As these measures are essentially meant to boost confidence, which has been visibly missing for awhile, regular updates or progress reports to the public can go a long way to appease the public. It will also set a fresh, no doubt, commendable and encouraging tone for the new leadership (end March 2009 and post Umno AGM and party elections).
For example, it is generally perceived that the Ninth Malaysia Plan (2006-2010) is way behind schedule in terms of spending and project implementation. In essence, some 50% has already been rolled out (against the 60% target by end-2008). This underscores the point that in the absence of information or updates in an orderly fashion, it is easier to assume the worst.
The pump priming mantra is ringing through many nations, some of which are in recession and most of which are tottering on the brink of one. Revealing a plan is merely the first step. Working it is even more crucial.
When nerves are rattled, a steady flow of information on the implementation of the stimulus plan, strategy and mindset of policy makers can be a soothing balm. And if it is executed well, waning confidence can be somewhat regained.
Speed and time is of essence. The automatic cut in contributions to the Employees Provident Fund would be the easiest to push through. Yet, the move is only effective on Jan 1, 2009, which means the money freed up by EPF through the cuts would only trickle down at the end of January next year. Remember this - so much has happened that has changed the global financial landscape in the past two months. Sauntering through an uncertain terrain may be something a slowing economy can ill afford.
For who really knows what it will look like two months from now?
Source:http://biz.thestar.com.my/bizweek/story.asp?file=/2008/11/8/bizweek/2490221&sec=bizweek