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512458
Thu, 11/15/2018 - 08:58
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https://oananews.org//node/512458
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2019 Budget Opportunity For Govt To Strengthen Economic Fundamentals -- Academician
By Azlee Nor Mahmud
KUALA LUMPUR, Nov 15 (Bernama) – The 2019 Budget presents a good opportunity for the new government to strengthen the fundamentals of the economic sub-sectors which need attention, said University Putra Malaysia’s Economics and Management Faculty Dean, Professor Azali Mohamed.
He said the 2019 Budget was a prudent budget, especially in managing the country’s debt as well as its focus on the Bottom 40 (B40) household income group.
“On the whole, the budget provides a solid foundation in preparation for the 12th Malaysia Plan which will start in 2021,” he said to Bernama recently.
In terms of Gross Domestic Product (GDP), he said the current global trend is not like how it was in the early 1980s, with global economic growth ranging between three per cent and five per cent at present.
“If we can achieve a five per cent GDP growth in 2019, it is considered good, as the nation’s economic growth is not solely dependent on domestic demand.
“Malaysia is an open economy in terms of trade, and at the same time, we are also hoping the domestic sectors to also help boost economic growth,” he said.
Azali said the GDP growth was also dependent on external factors, growth in foreign direct investments, the global oil price and sans economic crisis.
He predicted that the global oil price would not exceed US$100 per barrel by year-end if the Organisation of the Petroleum Exporting Countries is able to control its output, adding that it would also be a problem if the price is too high.
“Although it (the rise in global oil price) will increase (Malaysia’s) revenue, the country imports a lot of products which needs fuel input, and the price will continue to increase,” he said.
In terms of commodity, he said it was important to monitor the changing trends in commodity prices, and not just the domestic output.
“If the global commodity prices do not plunge, it will continue to have a positive impact on the nation’s commodity sector. Commodity prices are closely related to oil prices,” he said.
Meanwhile, on the country's fiscal deficit, Azali said it had risen slightly, but noted that the budgeted expenditures, including the deferment of major projects, would help to reduce the deficit.
“If the economy expands by around five per cent, I believe that the deficit will not be so big and is manageable,” he added.
--BERNAMA