ACCCIM MEDIA CONFERENCE
Survey Report on Economic Situation of Malaysia
for the First Half of Year 2011

12-9-2011 (Monday), 11.30 am, ACCCIM Conference Room

Speech by Tan Sri William Cheng, ACCCIM President

1. First of all, I would like to express my appreciation to all the media representatives for your presence this morning.

2. The ACCCIM Survey on Economic Situation of Malaysia for the First Half of 2011 is conducted as a means to gauge the economic situation facing the Malaysian Chinese business community in the First Half of 2011. The survey also covered some current issues in relation to the Government policies and measures, namely effect of minimum wages, “My First Home” Scheme, Third House Financing Cap ruling, 1Malaysia Housing Programme, 1Malaysia Shop and impact of the reduction of subsidies in Malaysia. This survey results would serve as important reference for the business community as well as to facilitate consideration by the Government.

Chairman of the ACCCIM Commerce Committee Dr. Leong Kai Hin will brief on the survey findings in a short while.

Ladies and gentlemen,

3. Bank Negara Malaysia has announced that Malaysia’s economic growth slows down to 4% in the second quarter of 2011, the slowest since recovery efforts from the 2009 recession. The moderation is attributed to the weaker external economic environment facing Malaysia as a whole, caused by the weaknesses in the advanced economies and disruptions in the global manufacturing supply chain arising from the earthquake and tsunami disaster in Japan.

Apart from this, the US credit rating downgrade and the debt burden in Europe also have an adverse impact on Malaysia’s economy, especially on the export-oriented manufacturing sector.

Given the increasingly uncertain global economy, Malaysian businesses continue to look towards the Government to introduce and implement stimulating economic policies and accelerate implementation of public development projects that can spur greater economic growth particularly to ensure our domestic demands remain strong.

4. The business community also wish to emphasize that the implementation of business friendly policies is imperative and necessary to spur the Malaysia economy. Again, ACCCIM would like to urge the government to review the price of natural gas for industrial usage. The government should compare the price with other natural gas producing countries and come out with a more competitive price. On electricity tariff, ACCCIM has suggested that the government conduct a study on how to reduce the cost of generating power, and thus reduce the cost of doing business. This will help to enhance the global competitiveness of Malaysian industries.

Ladies and gentlemen,

5. Inflation has continued to rise in the country. Businesses and general population are deeply concerned over the rising costs of living due to the escalating food prices and the adjustments of subsidy scheme. Controlling inflationary pressure is a major challenge to the government. In this regard, we wish to stress that efforts to bring about saving in administrative costs and increasing government efficiency and productivity must be done before any fiscal spending reduction. Implementation of adequate comprehensive measures are imperative to keep inflation rate low besides ensuring healthy economic growth.

6. While several global events continue to cast uncertainties on the world economy, ACCCIM urge the business community particularly SMES to constantly innovate as well as further improve their businesses operations. Productivity and innovation by adoption of new technologies are vital to the survival and profitability of SMEs in strengthening their competitiveness. The ACCCIM will continue to provide support to SMEs by initiating and organising activities such as training, seminars, business opportunity meetings, trade & investment missions to overseas, expo, etc to expand business network as well as to help SMEs embark on productivity improvements and innovation capabilities .

7. Finally, I commend ACCCIM Commerce Committee and UTAR’s efforts in making this survey a success. I also take this opportunity to thank the media for your support and cooperation in giving continued coverage on this survey exercise.

Thank you.