We have the internal resilience to face future economic challenges

Media Statement by Dr. Ong Kian Ming, Deputy Minister of International Trade and Industry (MITI) on the 20th of June, 2019

Dr. KS Jomo’s remarks to reporters at the sidelines of the Malaysian Economic Convention 2019 on Monday, 17th of June, 2019 was widely reported in the press. Specifically, he mentioned that “This is going to be a very, very tough time because the external situation is very bad and is deteriorating almost on a daily basis” He also added that “many of these problems are beyond the control of the Malaysian government”.[1]

I concur with Dr. Jomo’s view that the external economic circumstances continue to be very challenging, especially in the light of recent developments in the US-China economic relationship. I also agree that many of these challenges are caused by factors beyond the control of the Malaysian government.

When the US-China trade war was restricted to the area of tariffs on goods and services, Malaysia could at least benefit from some short-run trade and investment diversions. This can mitigate some of the longer term negative consequences of the trade war. For example, NOMURA has estimated that Malaysia will be the 4th largest beneficiary of the US-China trade war as a result of trade diversion.[2]

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Cautious Optimism on the Economic Outlook for the 2nd Half of 2019 as Pakatan Harapan (PH) Approaches its First Year in Government

Media Statement by Dr. Ong Kian Ming, Deputy Minister of International Trade and Industry (MITI) on the 8th of May, 2019

When the Quarterly Confidence Indicator for the 1st Quarter of 2019 was published by the Department of Statistics, Malaysia (DOSM), in the Business Tendency Survey report, this figure dropped to negative 2.2% from positive 7.1% in Q4 2018.[1] The February 2019 figure for the Leading Index Economic Indicator, also published by DOSM, showed a 2.2% fall from 118.9 to 116.3, the largest fall since April 2009.[2] The Nikkei Purchasing Manager’s Index (PMI) for March 2019, published by IHS-Markit, a market research firm, showed a figure of 47.2, the sixth straight month for which this index was under the 50 mark (more on the significance of this later).[3] Total trade for the first quarter declined by 1.5%. The negative news surrounding the Malaysian economy in the 1st quarter of 2019 was also felt “on the ground” through slower retail sales.

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Belt and Road Forum 2019 – Expectations and Opportunities for Malaysia

Speech by Dr. Ong Kian Ming, Deputy Minister for International Trade and Industry (MITI) on the 16th of April, 2019

  1. When President Xi Jinping first espoused the One Belt One Road (OBOR – 一带一路) policy in 2013 (later renamed as the Belt and Road Initiative or BRI in English), it generated a great deal of public interest and excitement outside of China[1]. There were three reasons behind this public interest, especially among countries in Asia.

2. Firstly, it tapped into a desire among Asian countries to develop economically in a manner similar to China, on the back of significant infrastructure development in highways, railways, airports, ports and other public infrastructure. China’s potential involvement in partly funding some of these infrastructure projects stirred excitement among many Asian countries which required heavy infrastructure development. These infrastructure developments are estimated to be in the trillions over the next decade.

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