KUALA LUMPUR: Malaysia may become a country dependent on remittances by Malaysians abroad if the government does not manage the economy well, Dr Mahathir Mohamad has warned.
The former prime minister said many professionals were already leaving the country to look for jobs elsewhere.
Also, government policies had increased the cost of doing business, resulting in “many” foreign-owned manufacturing companies leaving Malaysia, a move that had contributed towards unemployment, he said.
In his latest blog post, Mahathir noted that the level of borrowings by the government had reached record levels and that future generations would have to pay these loans.
Mahathir, who was prime minister for 22 years, said the government had not been prudent in its spending, and that was why it was running out of money, a fact made obvious when Budget 2016 had been recently trimmed.
Mahathir, who is Parti Pribumi Bersatu Malaysia chairman, charged that the money was being used instead for winning popularity for Najib.
“There are now 51 divisions in the Prime Minister’s Department. The budget allocation for the Prime Minister’s Department has risen from RM5.2 billion in 2000 to RM20 billion in 2016, a four-fold rise. It is 13 per cent of the 2016 budget of RM267 billion. It was less than four per cent between 2000 and 2008.”
Mahathir also charged that a large portion of the Prime Minister’s Department funds went “to unspecified programmes which the PM controls.”
Saying BR1M alone could cost the Government RM7 billion, he suggested that it would be better to give the hardcore poor sufficient monthly allowances to support their lives.
“For the rest, create jobs and train them. But the Government is not encouraging job creation. Local industries are not supported. But imports are encouraged,” Mahathir said.
He pointed out that emoluments had increased, rising from RM26 billion in 2003 to RM89 billion in 2016.
“But Federal revenue is decreasing relative to the GDP. Because the government believes in high income as the indicator of the level of development, salaries are increased without any regard for revenue or productivity.”
Saying per capita income was not the real criteria of the level of development, Mahathir added what was important was the purchasing power of the income.
“The rise in the cost of living has negated the benefit of high income. The new budget is likely to cause the cost of living to rise. It will affect the standard of living adversely. This will be especially so if the GST rate is increased.
“The depreciation in the value of the ringgit will also affect the purchasing power of the income. Since the government does not believe in local industries which can benefit from a cheaper ringgit but encourages imports, the cost of these would go up as the ringgit depreciates. There will be a greater outflow of funds, resulting in trade deficits.”
Mahathir said the increase in the minimum wage would increase the cost of production, which in turn would increase the cost of doing business in Malaysia. – FMT