Malaysia economic stimulus package was announced by their government in November 2008. Their Deputy Prime Minister and Finance Minister Datuk Seri Najib Razak announced a Malay economic stimulus package of Ringgit (MYR) 7 billion to maintain economic growth, reinforce Malaysian economy, and strengthen resilience against economic recession. Budget deficit for 2009 has been projected at 4.8 percent of gross domestic product (GDP), and growth rate has come down to 3.5 percent as compared to 5.4 percent in previous year.
These economy stimulus packages in Malaysia are in the form of housing benefits, entrepreneurial credit facilities, and reduction in compulsory deposit options. National government has allocated an economic stimulus package of Malaysia, which is worth MYR 1.2 billion for construction of 25,000 homes for low and medium income groups.
Economic stimulus package for Malaysia has also further set aside an amount of MYR 7 billion. It has been saved from fuel subsidy and would be channelized for housing development and promotion. As regards reduction in compulsory deposit options, Malaysian government has reduced employees’ contribution to provident fund from 11 percent to 8 percent. Universal participation by all beneficiaries can increase consumption expenditure by MYR 4.8 billion.
For encouraging infrastructure development economic stimulus packages in Malaysia have worked on reducing import duties on iron and steel products and cement. Coupled with a reduction in import duties, national government is offering benefits for setting up industries in the construction sector in its economic stimulus package to Malaysia. This is an opportunity for setting up healthy competition in construction materials market. Its benefit would pass on to consumers. In its endeavor to further develop infrastructure in Malaysia, its government has allowed foreign entities to buy properties worth MYR 500,000 without approval from Foreign Investment Committee. However such properties can be put to personal use only.
National government is also planning a second Malaysia economic stimulus package and is also identifying certain important areas. In this particular Malaysia economic stimulus package national government would be focusing on issues such as deregulation, simplification of procedures and doing away with red tapism. Part of this Malaysia economic stimulus package also deals with a movement towards a free market system.
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