FOTO:WRLR
The Associated Press
Published: October 13, 2008
KUALA LUMPUR, Malaysia: Malaysia's opposition leader on Monday called for overhauling the country's budget for next year, saying government leaders are "sleeping in broad daylight" while the global financial system is collapsing around them.
Published: October 13, 2008
KUALA LUMPUR, Malaysia: Malaysia's opposition leader on Monday called for overhauling the country's budget for next year, saying government leaders are "sleeping in broad daylight" while the global financial system is collapsing around them.
In a speech in Parliament, Anwar Ibrahim said even Singapore, with a more robust economy, has fallen into a recession while Malaysia's government remains in denial with claims that its economy is strong.
The government would be hard pressed to generate funds to make the budget work, he said. "They are not only dreaming but sleeping in broad daylight," Anwar said.
Prime Minister Abdullah Ahmad Badawi, who was not in Parliament for the debate, responded later by saying the Malaysian banking system is sound and not facing a liquidity crunch like banks in other countries.
The 208 billion ringgit (US$62 billion) budget announced by Abdullah in August promises higher development spending that is expected to boost the fiscal deficit to 4.8 percent of gross domestic product this year and 3.6 percent in 2009, from 3.2 percent in 2007.
The budget also has a raft of populist measures including a reduction in personal income tax and higher pensions in addition to greater spending on improving rural infrastructure.
Anwar noted that earnings from crude oil and palm oil, two of Malaysia's top income earners, are sliding because of a fall in global commodities prices. Demand for other goods also are expected to fall in the U.S. and Europe, which will hurt Malaysia's export-driven economy, he said.
"Enough is enough. Enough of this rot. Enough of this corruption," he said. "If the new finance minister is truly responsible, he must table a new budget."
Finance Minister Najib Razak also was not in Parliament during Anwar's speech.
Anwar, who has vowed to overthrow the government with parliamentary defections, says the opposition can produce a much better budget by wooing foreign investment. He has also pledged to roll back multi-billion-dollar projects proposed by Abdullah's government to cut the budget deficit.
Abdullah defended his government's policies, telling reporters outside Parliament that Malaysia is "not going into recession at the moment."
"We have some very strong economic fundamentals. And we have very strong reserves. Our trade surplus is still strong... Our savings are also very high," Abdullah said.
"We have a currency that today is stable... Our banking system is still strong," Abdullah said.
While the Malaysian stock market has fallen 35 percent this year, there has been no panic run on banks.
Abdullah recently handed over the Finance Ministry to Najib as part of a power transition.
Abdullah is scheduled to step down in March 2009 after facing a virtual rebellion in his party for leading the government to heavy losses against Anwar's three-party coalition in general elections last March.
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