FECAM-Youth urges government to solve internal and external economic's problem

The Federation of Chinese Associations Malaysia Youth Section (FECAM-Youth) urge Prime Minister Dato Seri Najib to address the problems faced by Malaysia in the economy sector and hope that the government could introduce strategies to improve the investment environment in Malaysia, besides helping SMEs (Small and Medium Enterprises) in their transformation problems.


The Federation of Chinese Associations Malaysia Youth Section Chief (FCAM-Youth) Hii Yik Ping issued a statement today, saying that the country's economy is becoming worse and the government must implement mechanism to handle this crisis immediately. This is to ensure that local investors will not lose faith in the government.

According to UBS Securities Asia Limited report, it says that in 2009, Malaysia experienced the biggest foreign exchange reserve losses among Asian countries and our official reserves fell by more than one-quarter. In addition, official figures show that approved investment for the first nine months of last year totaled RM19.1 billion, of which RM12.2 billion was foreign direct investment. That is a far cry from the RM62.8 billion of approved investments in the previous year, with just over RM46 billion in the form of foreign capital.

At the same time, recent media reports showed that many of Malaysia's top business tycoons are moving out of the economy. Asia’s richest businessman and Malaysia’s top corporate figure Robert Kuok sold off his long-established interests in the sugar importing and refining business. Save for his Shangri-La hotels nationwide, Kuok has little visible business interests left in Malaysia. Meanwhile, casino operator Genting, engineering and property group YTL, and the telecommunications and multimedia holdings controlled by tycoon Ananda Krishnan have been restructuring their respective corporations in recent months. They want to channel financial resources generated locally to finance overseas expansion plans.

Therefore, Hii Yik Ping feels that Najib’s immediate challenge is to recreate an environment that will encourage investment and convince the investors.

Apart from severe capital outflow, Malaysia also suffers from domestic issues such as the arson attacks on houses of worship and two missing Royal Malaysian Air Force (RMAF) F-5E jet engines. All these will weigh heavily on the investors' plans for future investments in Malaysia. Even Malaysia's number one trading partner, The United States, had expressed concern on both issues for more than once.

“Hence, Najib, as Finance Minister, should take immediate actions to solve the issue in a convincing and transparent manner, to regain the confidence of investors towards our government.” Hii Yik Ping said in his statement.

Besides that, the government should focus on solving problems that are harmful to the investment environment, for instance, corruption, public infrastructure and economy management because these are the reasons foreign investments are leaving the country.

Meanwhile, the country’s export-led economic model is sputtering because of weak global demand, while higher labour costs are forcing companies to consider other investment locations.

The Federation of Chinese Associations Malaysia Youth Section (FCAM-Youth) is in an opinion that the government should find ways to develop other potential industries such as SME, servicing industry, manufacturing industry and electronic industry. The government can bring down the tax and provide more low-interest financing plan to help the potential industries to grow.

Lastly, The Federation of Chinese Associations Malaysia Youth Section Chief Hii Yik Ping strongly suggests the government to open up more high income businesses sector and at the same time improve local investments, rather than over depending on the revenue from petroleum and foreign investment which is not sustainable in the long run.