SHAH ALAM: The State Government welcomes the Finance Minister Datuk Seri Najib Abdul Razak’s positive call for us to rise above politics especially on economic issues. We believe that it is now important for the minister to “walk the talk”. The state therefore calls on the Finance Minister to invite all heads of states and the Menteri Besar to work with the Federal Government in implementing the efforts stated in the minibudget.

It is hoped that the Finance Minister will extend an invitation to all states to submit proposals to address the looming recession with the support from the Federal Government. The Pakatan Rakyat Government in Selangor also hopes that the Finance Minister will also include the heads of state and the Menteri Besar in the National Economic Action Committee to monitor, implement and track the development of the minibudget.

Second, while it is important for the mini-budget to create employment and spend a reasonable fund on infrastructure, the main concern is whether it can be implemented efficiently and effectively. It is unfortunate that Malaysia’s reputation in this regards is appalling due to leakages in implementation.

For example, contractors have been known to collect their full 100 percent payment, but only doing 60 percent of the work. There is a need for a substantive surveillance exercise to monitor the productivity of this effort – one that is bi-partisan and independent. The rakyat have a right to know exactly where their ringgit is going to, as taxpayers. Effects of the first economic stimulus package, for example, have not been felt on the ground.

Since September 2008, the Selangor Government has cautioned the Federal Government on the drastic effects of the economic downturn and the need to act fast in addressing the matter. Yesterday’s RM60 billion mini-budget revealed by the Finance Minister was a reality check for the Federal Government.

While the State Government applauds the Federal Government’s proposal of the mini budget to confront the effects of the economic downturn and recession, it is also important to evaluate the details of mechanisms used to achieve the goals set therein.

One of the fundamental issues in the current economic situation is the fall of aggregate demand which has collapsed not only in Malaysia but also worldwide. Therefore it is timely for Malaysia to introduce efforts that can enhance the aggregate demand especially considering the fact that Malaysia’s economy relies greatly on international demand – as more than 60 to 70 per cent of the country’s produce is exported.

It is most unfortunate that this fundamental issue was not addressed by the Finance Minister in the minibudget which merely touched on domestic demand and employment creation and opportunities. Therefore, the State Government calls upon the minister to revisit the mini-budget to include this important element.

Among the proposals the Federal Government can consider are:
- creating incentives for companies to market their products at the international level
- provide subsidies for marketing programmes internationally
- tax rebate for travel agents to promote Malaysia abroad
- provide consultant rebates for those who can bring companies from abroad to purchase Malaysian made products

TAN SRI ABDUL KHALID IBRAHIM
DATO MENTERI BESAR SELANGOR