KUALA LUMPUR: The Government is confident that the country will still be able to achieve 5% economic growth despite the US and European debt crises.
However, Prime Minister Datuk Seri Najib Tun Razak said this could only be achieved if all groups worked towards sustaining economic growth, particularly with the private sector remaining committed in their investments.
Najib, who is also the Finance Minister, said the downgrading of the US credit rating by Standard & Poor’s and the debt burden in Europe would have some effects on Malaysia’s economy
“Malaysia is an open economy in which our total external trade is twice our gross domestic product (GDP). So, whatever happens to the world economy, say, if world economic growth is 1% less, the effect is a 0.4% decrease to our GDP.
“We hope that the crises happening now in US and Europe can be resolved so that the world economy will not crash because then it will have an effect on Malaysia,” he said after chairing the Barisan Nasional supreme council meeting here yesterday.
However, he said if the debt crises were to develop into a world economic recession, Malaysia, especially its manufacturing sector which relies heavily on the US and European markets, would surely be affected.
Source : The Star