Chinese main drivers of economy has little confidence

Survey: Chinese less optimistic this year

Tuesday March 20, 2012 by Wong Wei-Shen

KUALA LUMPUR: The local Chinese business community is less optimistic about the Malaysian economic outlook for 2012, a survey conducted by the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) has revealed.

RHB Research Institute Sdn Bhd vice-president of economics research Peck Boon Soon, who is also ACCCIM socio-economic research committee deputy chairman, said: “If you look at the trend, I suppose most businesses don’t really feel positive this year.

“They are feeling more upbeat for 2013.

“Under these circumstances, it’s in line with what global institutions have forecasted, which is that gross domestic product growth for this year will be weaker.

ACCCIM commerce committee chairman Dr Leong Kai Hin (left), Cheng and Peck (right) at the press conference on its survey report on the economic situation in Malaysia for the second half of 2011.

“Perhaps it will be in the region of around 4% to 5% as opposed to 5.1% last year.”

As for the external scenario, Peck said overseas business orders were not picking up.

“On top of that, the eurozone is likely to go into recession this year.

“Also, growth in China and India is also likely to slow down this year.

“Eventually, this will affect Malaysia’s exports as we can only rely on domestic demand.

“So under these circumstances, obviously businesses will feel less optimistic,” Peck said.

ACCCIM president Tan Sri William Cheng said the more challenging external environment could present greater downside risks to growth prospects and domestic demand was expected to continue to be the key growth driver.

“Today, Malaysia is facing stiff competition from other Asean countries to attract foreign direct investment inflow.

“Competition in the region has no doubt become increasingly intense.”

Cheng added that Asean enterprises were facing many challenges.

Such challenges include market entry barriers, rising labour costs, continued increases in prices of raw materials, and instability in the international market.

The survey is to gauge the economic situation of Malaysia for the second half of 2011 and how it has impacted the Chinese business community, and to assess the various measures undertaken by the Government.

Those who participated in the survey included from the wholesale and retail, manufacturing, professional and business services, construction and agriculture, forestry and fishery sectors.

Of the 649 questionnaires sent out, only 277 responses were received.

Source: http://biz.thestar.com.my/news/story.asp?file=/2012/3/20/business/10947533&sec=business

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