Monday, March 1, 2010

John Lee on NAJIBONOMICS

Extracted from an essay, The Future of Najibonomics, by John Lee; posted at The Malaysian Insider on 1 March 2010...


The Barisan Nasional government is simply a ship of fools, content to lead us to disaster. They have no vision for the country, no idea of the massive challenges we face or any intention to face such challenges to begin with.


In terms of capital, it is no secret that net investments in Malaysia are dropping off a cliff. Until about halfway through the Abdullah Badawi administration, net investment on an annual basis was hovering somewhere near zero—that is to say, foreign investments coming in roughly equaled Malaysian investments going out.


To put this in more concrete terms, what this means is that foreigners are refusing to invest in Malaysia, and Malaysians insist on investing their money overseas.

A back of the envelope calculation suggests that last year, Malaysians invested almost as much money in the entire Australian property market alone as foreigners invested in the whole of Malaysia.

Investors, both Malaysian and foreign, have completely lost confidence in our country — nobody wants to put money in Malaysia, and so our savings are flowing out of the country, instead of being invested in local enterprise.

It’s no wonder people are losing faith in Malaysia. We have no plan to fix our fundamentals. Our school system discourages innovation in favour of accepting orders from above; our economic system stifles entrepreneurship in favour of corrupt rent-seeking.


Our prosperity is pump-primed by petroleum and forestry — when we run out of these resources, without any human capital or meaningful industrial enterprises, our economy will collapse.



John Lee is a third-year student of economics at Dartmouth College in the United States. He has been thinking aloud since 2005 at infernalramblings.com. Read the entire essay here.

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