Anwar Ibrahim is quite funny. He is saying that we are heading for an economic crisis with a double whammy - declining international crude oil prices coupled with a depreciation of the Ringgit at levels unseen since the Asian Financial crisis of 1997.http://www.malaysiakini.com/news/283322
The continuous decline of Brent crude oil price since the middle of the year from the level of US$110 per barrel to US$65 per barrel means a reduced income of almost 40 percent of sales of crude oil.
Add this to the plunge in the value of the ringgit against the US dollar to almost 3.5 (US$1 = RM3.50), the rakyat will be facing a bleak future in terms of higher prices for local food products, especially imported.
Since almost 90 percent of our basic foodstuffs are imported, any withdrawal of food subsidies will exert additional burden on the people, being already saddled with the overall rising cost of living encompassing their daily lives.
Do you remember who was our finance minister for the 6 years before our financial crisis in 1997?
Yes, you were him. Thank you very much, you idjut!!
Do you know that oil prices were about USD40+ as early as 5 years ago in 2009?
Did you also know that oil prices were between USD15 to USD21 the whole of 1997 and dropped to USD11 in 1998?
Also, did you know that in the past few years, Malaysia's oil net exports are much much lower compared to 1997-1998 as we have had an explosion in domestic oil demand and we are only a marginal net oil exporter or importer at best?
Therefore, low oil prices have much lower impact than you think we have now compared to 1997-1998 when we were more heavily dependent.
And did you know our Ringgit fell as low as USD1 to RM4.70 in 1998 after the mess you created coz our forex reserves were as low as USD18 billion then?
Now our oil prices are about USD65 per barrel, ringgit at USD1 to RM3.5 and our forex reserves are at USD130 billion, do you expect our economy to be as bad as 1997-1998.
Also, although we import 30% of our food but we don't all import it in USD. Much of our food imports are from neighbouring countries like Thailand and Vietnam and China - and all these countries also depreciated against the USD as it is a global trend due to the easing of the QE2 in the USA. Have you not heard of cross-currencies? A pair of currencies traded not involving USD.
Therefore the impact is limited.
Dear Ketum, it is frightening that since 17 years ago,you still have not learned anything about proper economics. That is just sad.
I hope you never become our Prime Minister nor our Finance Minister coz you simply do not have the smarts and knowledge to do this job.
Malaysia will cope and we will survive as we have much smarter and more capable people at the helm compared to you then.P
Source : lim sian see