The economy keeps growing under increasingly difficult circumstances
FIGURES for the first quarter of the year show that the economy is on track to perform as forecast, which suggests that Malaysia remains resilient amid an increasingly uncertain global outlook. The announced 4.7 per cent growth, though seemingly low under ordinary circumstances, is laudable given the recession in Europe and the slowdown in the United States. Europe is threatening to fall apart and the world is warned against the possibility of trouble if Greece exits the eurozone. Should that eventuality come to pass, a worldwide slump cannot be discounted. No doubt, both France and Germany -- the European Union's major powers -- are agreed that Greece cannot leave the Union, but the Greeks could still reject their commitments to austerity in fresh elections next month. As frightful as it may appear, most countries are already bracing for the worst case scenario.
That is as it should be. With so many warning signs, there can be no room for complacency. Fortunately, much good news for Malaysia is self-generated, such as an inflation rate that is well under control and is expected to stay that way throughout 2012 barring a spike in the price of oil to record levels as happened a few years back. Indeed, for the most part any economic adversity Malaysians have had to endure recently has been the result of external factors beyond our control. Granted, this is an election year, but that is no excuse to not appreciate what is being done to keep the cost of living low and the standard of living affordably high. Don't forget, too, that none of what is being spent on the rakyat is borrowed money, which speaks well of our national coffers.
Given the weak international environment, the country's ability to buck trends is sometimes surprising. The one-off BR1M payments came from tax revenues brought by an expanding economy and steady trade. But the country's traditional markets upon which much development has depended are sorely pinched. Instead, the growth in trade is attributable to newer markets, such as China, our biggest trading partner with which we enjoy a considerable trading surplus. In fact, Asia now accounts for much of the recent increase in trade. Another important contributor to economic performance is the changing pattern of domestic consumption. Malaysians are absorbing more goods and services, shifting the onus of growth from the export sector. Not only are we keeping our producers going during bad times, Malaysians are sowing the seeds and reaping the harvests of a strong and stable economy.