Categories
Economics

[2461] The unexpected 5.8% growth

The GDP growth number for Malaysia shown on the Bloomberg machine surprised me. I had expected somewhere between 4.0% and 5.0%.

Trade numbers had been very good for the fast few months but I did not expect it to push the GDP growth figure close to 6%. In fact, I watched in awe the growth of the trade numbers given the current confusing state of the world’s economy.

For the GDP figures themselves, the year-on-year growth for the third quarter was 5.8%. The average growth expected by economists listed on Bloomberg was 4.8%. This number had progressively grown over the past months from a number close to 4.0% to what it is now.

Looking at the numbers sweepingly and superficially, government spending grew the largest percentage wise. It grew close to 22%. In terms of absolute value, consumption grew the largest and indeed, it was the main contributor to most of the GDP growth.

I am tempted to say the consumption growth was related to government spending (since the separation between government and the private sector is not so clear cut) but without the energy to mine for that, I will refrain from making more courageous statement.

But what exactly is the driver behind the consumption? In my head, I can only think of government. If I want to know more, I clearly need to dig deeper into the numbers.

Was the growth due to base effect? I do not believe so. Base effect is not a convincing case in post-recovery period. Year 2010 had been a year of normalization and year 2011 grew from a somewhat normalized base. So, I am discounting base effect from explaining the unexpected high growth rate.

Categories
Economics Humor

[2460] Prof Dan on the Daily Show!

That is my former econometrics professor at Michigan, the famed Daniel Hamermesh! And he was on the Daily Show!

Categories
Economics

[2459] Did you spot something?

If you were the editor, what would you do?

PETALING JAYA: Total vehicle sales in October 2011 rose slightly by 3% to 53,654 units from 52,297 units a year earlier, boosted by the fact that it was a longer working month (versus September) and the return in consumers’ buying interest. [Eugene Mahalingam. Vehicle sales up. The Star. November 17 2011]

Here is a clue: year-on-year.

Categories
Politics & government

[2458] PEMANDU needs an expiry date

A friend asked me once what I thought of PEMANDU. He expected me to praise it since he knew where my economic bias lies. Here was PEMANDU advocating liberalization in a number of ways. There I was, a person who has been accused of being a neo-liberal at one time or another… there was a match in preferred policy. Despite that, I gave the friend a non-committal answer because I was unsure how things would turn out in the end.

Things have become clear since and I have rationalized my thoughts, I think, quite comprehensively. This is what I think of the unit under the Prime Minister’s Department.

Many of these initiatives can be done without PEMANDU at the helm. A number of initiatives are Proton-like, with Proton being more or less a rebadged Mitsubishi. Many projects merely received a nod from PEMANDU and that alone allows those projects to be listed as PEMANDU-related projects.

To be fair, there are actual initiatives like the Government Transformation Program with all of its indicators. Many initiatives offer real measurements of progress in some areas. In the past, progression and regression were purely a matter of opinion. These measurements provide an anchor for a more objective discussion. That is laudable. The work on the mass rapid transit is two, save some problems like how contracts are being awarded. One can have a list of the good stuff done and planned. Its push for a more responsible approach in public finance is another praiseworthy effort, although contradictions raise skepticism.

How does one react to PEMANDU’s call for subsidy and deficit reduction when the unit itself praises fiscal populism?

How does one react to a call for private-led economy when it is the public sector that is leading the charge?

How does one react to market-friendly affirmative action?

Beyond the superficiality and the contradiction lies one consistency. PEMANDU signifies the concentration of power. Roles once spread among various ministries — which can be a system of check and balance — have now been transferred to the Prime Minister’s Department. The fact that the prime minister and finance minister are the same person serves only to strengthen the point.

Pemandu is now the economic central planner, the construction contractor, judge and all. It is even your emailman, judging by its enthusiastic support for the 1Malaysia email project.

Power concentration can be useful when the government itself is debilitated, filled with deadwood, stuck with legacy issues and trapped in time. For example, PEMANDU’s public communication is slick. One can imagine how badly such communication would have been handled by the Ministry of Information. The ministry is still fighting the communists after all of these years.

Just as the concentration has its benefits, there is a cost. The cost is a weakened check and balance system.

There is such a thing as too much power and Pemandu is accumulating powers within the government. Given its wide-ranging influence, it is becoming a ministry by itself, headed by an unelected minister who reports to yet another unelected minister.

Meanwhile, other parts of government are becoming weaker as their roles diminish. Where is the Ministry of Works in the MRT equation? Where is the Ministry of Finance in the subsidy debate? PEMANDU appears to play the larger roles, implying its influence. This will adversely affect the democratic nature of governance in Malaysia, whatever much left there is. The continuous existence of PEMANDU will continue the trend of power accumulation.

For this reason, PEMANDU should not exist for eternity. There has to be an expiry date so that these concentrated powers will not accumulate to a point that it becomes a struggle between an authoritarian and the rest of Malaysia. There must be a point when those powers will be redistributed back across the government.

Mohd Hafiz Noor Shams. Some rights reserved Mohd Hafiz Noor Shams. Some rights reserved Mohd Hafiz Noor Shams. Some rights reserved
First published in The Malaysian Insider on November 7 2011.

Mohd Hafiz Noor Shams. Some rights reserved Mohd Hafiz Noor Shams. Some rights reserved Mohd Hafiz Noor Shams. Some rights reserved

erratum — In the original article at The Malaysian Insider, I misidentified Menara Warisan Merdeka as Menara Wawasan. Furthermore, I mistakenly associated it with PEMANDU. I have removed the reference here. Apologies for the mistakes. Here are the deleted sentences: “Take the Menara Wawasan proposal by PNB. PNB could easily go ahead with it without Pemandu stamping a GNI value to it.”

Categories
Fiction Personal

[2457] A necessary lie

He remembers all too clearly what happened six months ago on the other side of the world as he stands among strangers under a statue of St Michel, waiting for an old dear friend to emerge from the Metro.

”Don’t bite your nails.”

”You’re starting to sound like my mother,” she replied to him sarcastically as both of them sat by the table, feeling a little bit nervous by each other’s presence. This was six months ago.

”Okay, but you should listen to your mother,” he said.

She gave a curt but a cute ”pfft”. Her reply made him smile, but he regretted saying what he said almost immediately. He didn’t want to annoy her unnecessarily, although such teasing was exactly the thing that brought them together in the first place. Life is so full of paradoxes.

”Why do you like to bite your fingernails, anyway?” He was genuinely curious.

”Well, that’s how I clip my nails.”

He wasn’t quite sure if she was either joking or being serious. The cultural gap between them was wide enough that one makes an assumption on one’s own peril. But he risked it anyway. He wanted to hear her voice. He wanted to see the expression on her face.

”Really? You expect me to believe that?” he incredulously asked.

She smiled, perhaps realizing the outrageousness of her statement. But it was true. She bit her nails to keep them tidy. Almost.

”Okay. Sometimes.”

”I don’t believe it. Give me your hands.” He grabbed both of her hands and inspected her fingernails, which were surprisingly neat.

”Wow” was all he could muster.

”I told you so,” she said almost mockingly as her smile became wider. She loved being right.

He didn’t quite think much of it at first. He had innocently taken her hands, but it soon struck him that they were holding hands for the first time. And in this cold weather, her hands were soothingly warm. They felt so comfortably soft. Holding them felt like a sinful sensual pleasure.

He felt guilty. He liked her but he also respected her. He didn’t want to turn her into a sensual object, a being that existed just to present this private moment to him.

Most importantly, he didn’t know how she felt towards him despite having gone out with her and having simple fun together several times already. Movies, dinners, kayaking, theatres, funfairs. He knew he liked her, but a relationship such as this must always be mutual. He was still unsure, but he couldn’t ask her. One cannot be too explicit with these things.

He didn’t want to be presumptuous about whatever happening between them. It could be that they enjoyed each other’s company as friends and nothing more. If that was the case, then he didn’t want to ruin it. He could live with being close friends, but he couldn’t imagine losing her completely.

He decided to loosen his grip, even if reluctantly. The conflicting emotions were tearing him apart. No longer smiling, she must have realized whatever he felt. His hands were slipping away slowly but surely.

But she wouldn’t let that happen. She quickly took his hands and held them tightly. And she smiled at him, hoping to assure him of something.

”Merci, mademoiselle.”

He sighs forlornly in the cold Paris, ruing how time has changed. He wants to meet her for one more time, but something tells him that that isn’t the best of all ideas. Another friend of his was convinced that it is the worst of all ideas.

”It’s the end. You’ll suffer more if you meet her again,” the friend said.

”I know, but I just want to see her again for one last time,” he stubbornly replied. ”I need to see her again, just for one more time.”

”You’re a sucker for pain, you know that. You going there will only hurt both of you. You need to move on and get over her.”

Whatever it is, it is too late to back out now. There she is, walking straight towards him, smiling and looking beautiful, as she has always been.

He smiles back, partly relieved to see her again, partly devastated that he won’t be able to hold her hands again.

”Hi…” she says rather nervously, wearing a smile to hide, perhaps, the past. ”How have you been?”

In his mind, he wants to say I miss you so much. He doesn’t. Instead: ”I’m feeling great, and I’m excited to be here for the first time.”

A necessary lie, perhaps.

Mohd Hafiz Noor Shams. Some rights reserved Mohd Hafiz Noor Shams. Some rights reserved Mohd Hafiz Noor Shams. Some rights reserved
First published in Selangor Times on November 4 2011.