KUALA LUMPUR, March 11 – Finance Minister Datuk Seri Najib Razak today defended the RM60 billion figure of the second stimulus package, saying that investment was needed to go hand in hand with consumption.
Analysts have expressed disappointment that yesterday’s announcement only amounted to RM13 billion worth of direct fiscal injection for 2009.
The deputy prime minister said however that the RM25 billion in guaranteed funds as well as the RM10 billion investment to be injected by government investment arm Khazanah Nasional were not “silver bullets” but meant to prevent Malaysia from slipping into recession.
“If we can successfully implement the second package, we can prevent a recession,” he said.
“It will have the desired impact because you are making additional money available for private companies to undertake investment,” he said, adding that the investments would create more economic activities which will in turn create employment.
“One of the key elements in the process of recovery is to make sure that the banking sector is functional and to make sure that the credit is available for industries,” he said of the three funds designed to encourage financial institutions to approve loans to businesses.
“We have to look in terms of consumption as well as investment,” Najib said.
Asked on how soon the stimulus plan would begin to move on the ground, he said that some projects “can take off immediately,” citing about RM2 billion worth of projects that have already been tendered out by the Education Ministry.
Najib added that the government was trying to ensure that as much as possible of the RM60 billion would be implemented soon but in certain cases, such as in the three guaranteed funds, it would depend on the takeup by private companies.
He also said that the RM8.4 billion from the Ninth Malaysia Plan that would be accelerated was mostly in terms of infrastructure, includingthe RM2 billion for schools.
Source : Malaysian Insider