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Bruce Gale wrote a piece in the Straits Times defending Najib’s economic policy recently. While I do agree with on points like subsidy removal, I have several issues with the article. The one I take the most exception is his claim that the goods and services tax (GST) was needed because Malaysians were avoiding income tax, […]

The GDP growth for the second quarter decelerated further to 4.0% YoY from 1Q16’s 4.2% YoY. But the most interesting GDP component ever since the GST was implemented in April 2015 is private consumption. And there was a huge jump in that part of the equation. The 2Q16 private consumption expanded 6.3% YoY from 5.3% YoY in […]

Apart from the slowdown in consumption, I was wrong. The Malaysian GDP grew 4.9% from a year ago, considerably higher than what I thought it would be at 4.1%-4.2% YoY. Still, economic growth is decelerating quite drastically. Trade surplus did not improve as exports contracted worse than imports, and not the other way round as I wrote […]

There is something quite weird going on in the imports data. In the last quarter, we all know we had GST for the first time. It replaced an older consumption tax. After all have been said and done, the effective rate was higher than it was under the old regime. That means higher tax. You could also […]

The Malaysian GDP figures released yesterday suggest there was indeed a pre-GST spending spree. Private consumption growth was phenomenal especially if you consider the fact that previous quarterly growth figures have been slowly dropping gradually over the past year from 8% year-on-year to all the way down to mid-6% in the third quarter of 2014. The […]

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