Five suggestions ahead of a challenging economy

SHAH ALAM - Economists suggests five recommendations to be considered by the government following the prediction of the challenging global economy next year.

The five consisted of replacing imported items, raising food stocks, finding a new market with China, delaying the purchase of safety assets and delaying the implementation of less important new development projects.

Universiti Tun Abdul Razak (Unirazak) Economist Professor Dr Barjoyai Bardai said the five aspects were important matters to be focused on by the government.

On the rationale behind finding a new market with China, he said the country had the most population in the world and did not suffer the large turmoil as the western countries.

"In general Malaysia is not expected to face a recession because due to the growth statistics of the economy this year was in a positive rate.

"In 2023 and 2024 global economists expect the challenges would be caused by the recession in western countries and we would see its development affect us.

"This is due to 80 per cent of the input goods and food in the country being imported, so we would feel the inflation as a result," he told Sinar Harian after being asked to comment on the expected global economic prospect with the challenging predictions next year.

He said the global economic recession was expected to have a significant impact on several sectors in Malaysia among them manufacturing, petroleum and palm oil.

He explained the sectors were not exempted from the effects due to both being interrelated to each other.

He said among the approach that could be taken would be spend conscientiously, reduce eating out, only travel locally instead of abroad and purchase local products.

"Looking at the continuously challenging economic situation, the public need to be smarter in managing their finances because it is not the best time to spend for unnecessary items.

He was optimistic towards the country's economic situation as it was not similar to how it was two years ago following the closure of economic sectors in preventing Covid-19.

"We admit that it is predicted to be challenging next year, but we are confident that it would be less challenging than two years ago and the government surely had taken it as a lesson from the closure causing the country's economy to drop," he said.

Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz had said the prospects of the 2023 economy were expected to be challenging for all countries and had denied the claims that Malaysia was in an economic crisis.

The World Bank recently warned the world would be immersed in a recession next year while central banks would raise interests as a reaction to inflation.

According to their research, the central banks throughout the world raised their interest rates this year to a rate that has not been seen in five decades.