Malaysia revised budget 2015: cuts RM5.5 bil, deficit target 3.2%, focus on manufactured goods

Prime Minister Datuk Seri Najib Razak delivers his speech on the revision of the Budget 2015 at the Putrajaya International Convention Centre today. He said a slew of cuts amounting to RM5.5 billion will take place as part of Putrajaya’s proactive measures. – The Malaysian Insider pic by Nazir Sufari, January 20, 2015.

Prime Minister Datuk Seri Najib Razak today announced a slew of budget cuts amounting to RM5.5 billion as part of Putrajaya’s “proactive measures” to align itself with plunging global oil prices and revised world economic growth projections.

The cuts would come from the Budget 2015’s operational expenditures that were initially set at RM223.4 billion, while the RM48.5 billion for development would remain untouched, Najib said in his speech today at the Putrajaya International Convention Centre.

Also, the fiscal deficit target of 3% of the Gross Domestic Product (GDP) for the year has been revised to 3.2%.

Najib said this was still lower than 2014’s fiscal deficit of 3.5%. The "proactive measures" to achieve the RM5.5 billion savings are:

“(The government will) optimise outlays on supplies and services, especially overseas travel, events and functions and use of professional services. This will result in savings of RM1.6 billion.

“Second, defer the 2015 Program Latihan Khidmat Negara (National Service) to enable the programme to be reviewed and enhanced, with savings expected at RM400 million.

“Third, review transfers and grants to statutory bodies, GLCs, Government Trust Funds, particularly those with a steady revenue stream and high reserves. This measure will result in savings of RM3.2 billion.

“Fourth, reschedule the purchase of non-critical assets, especially office equipment, software and vehicles, with an expected savings of RM300 million.”

Najib said Putrajaya’s revenue would be enhanced by encouraging companies to register with the Royal Malaysian Customs to enable them to charge and collect the goods and services tax (GST).

He estimated that broadening the tax base would contribute an additional RM1 billion.

Putrajaya would also realise additional dividends from GLCs and GLICs as well as other government entities amounting to RM400 million, said Najib.

He added that the revisions to the budget were necessary as Putrajaya would otherwise face a revenue shortfall of RM8.3 billion due to falling crude oil prices, despite savings of RM10.7 billion after doing away with fuel subsidies.

“Without any fiscal measures, the deficit will increase to 3.9% of GDP against the target of 4% for 2015.

“This requires the government to take measures to reduce the deficit, in line with the government’s commitment towards fiscal consolidation.”

Najib said the GDP growth target between 5% and 6% had been revised to between 4.5% to 5.5%.

To ensure economic growth remained strong, he said Putrajaya would boost exports of goods and services, enhance private consumption, and accelerate private investment.

Among its strategies are postponing the scheduled electricity tariff and gas price hike, and increasing nationwide mega sales.

Meanwhile, Najib announced an initial allocation of RM800 million for the repair and construction of basic infrastructures affected by the recent floods, and another RM893 million for flood mitigation projects.

These included building eight-foot high stilt houses for those who have land and whose homes were damaged by the floods, and handing over 1,000 units of low-cost homes in Gua Musang, Kelantan.

As he concluded his speech, he told Malaysians the country was not in a financial crisis or recession, but simply taking pre-emptive measures.

“We are neither in recession nor a crisis as experienced in 1997, 1998 and 2009, which warranted stimulus packages.

“The strategies announced by the government are proactive initiatives to make the necessary adjustments following the challenging external developments which are beyond our control.

“This is a reality check following, among others, declining global crude oil prices,” he added. – January 20, 2015.

By ANISAH SHUKRY The Malaysian Insider

Focus on Malaysian-manufactured goods

PETALING JAYA: The impact of the reduction in global oil prices from US$100 to US$40 per barrel can be offset by a rise in demand for Malaysian-manufactured goods, said Prime Minister Datuk Seri Najib Tun Razak (pic) on Tuesday.

Najib, who announced revisions to the 2015 Budget which was tabled in October 2014, said that this could be done as crude oil only makes up 4.5% of the nation's total exports.

"The reduction in the price of crude oil will indirectly increase demand in Malaysia-made products. We will actively promote 'import-substitution' to reduce our dependency on external sources to obtain goods and services," said Najib.

He added that the Government initiatives would be created to increase the use of the private sector.

"We will give priority to local Class G1 (Class F), G2 (Class E) and G3 (Class D) contractors registered with the Construction Industry Development Board to carry out recovery works in their local areas affected by the east coast flood," said Najib.

He added that the Government would intensify promotions encouraging the public to buy made-in-Malaysia products.

"We will increase the frequency and duration of mega sales throughout the nation, and intensify domestic tourism promotions by offering competitive airfares," said Najib.

He also said that the Government would encourage the private sector to reap opportunities created by the Asean Economic Community.

"We will also intensify programmes to boost exports of Malaysian goods in 46 nations across Asia, Europe, the Middle East and America," said Najib.

In his speech, Najib said the adjustment to the 2015 Budget was necessary to "ensure our economy continues to attain respectable and reasonable growth, and development for the nation and rakyat continues" as the 2015 Budget was based on the price of crude oil remaining at US$100 per barrel.

"Based on a crude oil price of US$100 per barrel and taking government saving measures and retail price controls into account, the Government was expected to have a fiscal profit of RM3.7bil. However, with the current price of oil at US$55 a barrel, the government will lose RM13.8bil in income," said Najib.

By Tan Ti Liang The Star/Asia News Network

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Budget Revision: Highlights

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Malaysian worked as janitor is a serious innovator

TV star: Dr Walter showing the company’s big LED television.

From Janitor to serious innovator

MALACCA: As a university student, he worked as a janitor to earn some pocket money.

Dr Gabriel Walter, 37, who studied electrical engineering at an American university, now holds about 100 patents in electronic and electrical innovations.

The Kelabit boy from Bario, Sarawak, wants to break the monopoly of foreign brands selling their products at exorbitant prices.

For example, he has introduced a big screen light emitting diode (LED) television, which includes all connecting gadgets, and priced at about RM6,000 compared to popular foreign brands that can cost almost RM20,000.

There is also a smartphone application, costing just a few hundred ringgit, that can integrate home appliances with just a cyberspace connectivity.

“I am determined to make available quality, feature-perfect appliances that can communicate with any other devices in an ad hoc network with a single connectivity.

“All these wonders are packaged and assembled here and sold at affordable prices. It is a Malaysian invention,” he said in an interview.

Dr Walter, who was a Mara scholar, studied at the University of Illinois at Urbana-Champaign where he earned a doctorate.

He was an Adjunct Assistant Professor from 2003 to 2009 at the university, where he was also once a senior research scientist.

Despite his long list of achievements, Dr Walter has not forgotten his humble beginnings where his father used to live in a longhouse.

At a tender age, he started selling groundnuts to help supplement the family income.

“Life was hard then. I used to work as a janitor when I was studying in the United States as the scholarship was only adequate to cover my education,” he said.

Several months ago, Dr Walter returned to Malaysia for good after receiving a government grant of RM2mil for research and development before setting up his own manufacturing plant in Batu Berendam.

“I must thank former Chief Minister Tan Sri Ali Rustam who was persistent that I should set up a plant in Malacca when he first met me in 2006 during a bio-tech conference in the United States,” he said.

Dr Walter established Quantum Electro Opto Systems Sdn Bhd (QEOS) and launched its first commercial product based on its patented high-speed light-emitting technology known as tilted charge dynamics in 2013.

QEOS is based here with an office in the Silicon Valley, California, where Dr Walter is the chief executive officer.

His university mentors – professors Nick Holonyak Jr and Milton Feng – are part of his team.

The QEOS website stated that Prof Nick Holonyak Jr is widely regarded as the inventor of LED.

The company, it said, wanted to “pioneer the commercial development of high speed, low-cost and power efficient fiber optics communication solutions”.

By R.S. N. Murali The Star/ANN

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Chinese women's marriage criteria,logical search for a mate

72% of women consider housing as a key requirement for a marriage partner, says the latest report of the Chinese Marriage Status Survey 2014, issued by China’s leading marriage service provider Baihe.com on Jan.11, 2015.

Researchers collected the results of 73,215 online questionnaires and held in-depth off-line interviews with 200 single men and women from 34 provinces, municipalities and autonomous regions.

Why still single?

The report shows that 63% of single men and women spend an average of more than six hours alone on their rest days; and 32% spend more than 10 hours alone. Surfing the internet, hanging out with friends, and just “quietly” staying at home have become the top three activities for single people.

32% of single women follow TV dramas while 67% of men scan websites, killing their private time at home.

The report concludes that the main reasons for remaining single is too much time spent alone - too few social contacts is the top obstacle to meeting the right person. 80% of single women report this.

Gender differences in marriage requirements

Nowadays, love is no longer the only passport for two people to enter marriage. The report says that more than 40% of single men and women are only willing to get married with a person in a suitable situation. People are becoming ever more rational and realistic when choosing their spouses.

The top three concerns for single men are appearance, physical health, and emotional experience. Single women attach more importance to a partner’s financial situation, physical health, and career.

33% of single men and 27% of single women have experienced interference from parents in their relationships.

Focus on housing

The report shows that 71% of women view housing as a key requirement for a potential marriage partner. 18% of women counted car ownership as one of the basic requirements, a rise of 9% compared with 2012. Both men and women said that a stable income and some savings were important factors.

Nearly 60 percent of women do not intend to have a second child, according to the report, although China has relaxed its birth control policy to allow couples to have a second child if either parent is an only child.

The report also shows that 33% of women think that Chinese men do not deserve Chinese women, in terms of "self-accomplishments and ability to care for themselves." - (People's Daily Online)

The logical search for a mate

‘Love’ takes a back seat when seeking prospective life partners

LOVE is not the only criterion for marriage in China. A recent survey shows that more than 40% of Chinese look to marry someone who suits them in appearance, educational background, social status, income and other characteristics.

Baihe.com, a major dating portal in China, released its 2014 Chinese Marriage Status Survey Report on Sunday.

The site has tracked marriage trends in the country since 2007.

The latest results show that 44.4% of male and 49.7% of female respondents said the reasons for their choice of a marriage partner include their prospective mate’s coming from a family of equal social rank.

“This means people are much more rational when it comes to the marriage decision,” the report said.

“They would like to match each other under every single standard. Love is no longer the only pass.”

The report also said that more than 70% of female respondents said they would consider marriage only if the male partner owns property.

And more than 70% of the women hoped their future husband’s income would be double their own.

Zhou Xiaopeng, the chief marriage consultant at Baihe.com, characterised the phenomenon as “supermarket marriage”, where people come with “money in hand” and want to select the best “products” after shopping around.

Tu Ying, a researcher at the portal, said that seeking a partner with quantifiable requirements is efficient.

“In everyday life, it is more and more difficult to find the right person and get to know him or her – not to mention the cost it comes with,” Tu said. “If people start with quantifiable standards, and then develop their relationship based on that, it is more likely to be a stable relationship.

“Starting marriage with money cannot guarantee stability from the beginning.

“Every relationship needs cultivation from each side.”

Zhou Xiaozheng, a professor of sociology at Renmin University of China, attributes the new approach to marriage choices to changes in society.

“Chinese people’s view of choosing a mate has undergone many changes,” Zhou said.

“In the past, marriage was arranged by parents, which reflected the will of family or country. Then it became a personal choice, or socalled love choice. And now it is more related to material standards, or what we call materialism in marriage.”

“This is simply because people live in a materialistic world: A couple needs an apartment to live in, which costs a lot; the couple needs to find a good school for their children, which costs a lot; the couple who live far away from their parents need to find a way to support them, which also costs a lot,” Zhou said. “It is a vicious circle.”

Zhou said to reverse the materialistic trend, the country needs to continue its anti-corruption campaign and improve social welfare, and young people need to know that money is not the solution to everything. - China Daily/Asia News Network