Nikkei’s October article not accurate, says ministry

PETALING JAYA: The October 2018 Nikkei report that has gone viral is an attempt by irresponsible elements to mislead people into thinking that the Malaysian economy is doing poorly, says the Finance Ministry.

Minister Lim Guan Eng said the article, written based on August trade statistics, is misleading people that the economy is currently recording negative statistics.

“Giving a monthly snapshot is not accurate because it does not correspond with Malaysia’s performance over the whole year,” Lim said in a statement yesterday.

The report said the country’s trade surplus was only RM1.6bil and the lowest in 45 months.

According to Lim, two months after the August figures, Malaysia’s trade surplus rose to a record RM16.3bil.

“Exports rose 17.7% to RM96.4bil in the same month, a record high for the country,” he said, adding that monthly data does not reflect the entire picture of the domestic economy.

Lim said people should not lose focus over short-term fluctuations as longer-term trends are a more accurate depiction of the overall economic situation.

For example, Nikkei Malaysia Manufacturing Purchasing Managers’ Index (PMI) for December 2018 falling to 46.8 points should not be considered a reflection of the entire economy for the whole year as the figures may increase in later months, Lim added.

“Indeed, longer-term figures such as approved manufacturing FDI (foreign direct investment) for the first nine months of 2018 rose 250% to RM49bil.

“These investments will be realised in the future to create high-quality jobs for Malaysians.

“Additionally, Malaysia’s stock market was the second best performer in Asia-Pacific in 2018,” he said.

On inflation, Lim said it averaged at only 1.0% year-on-year for the first 11 months of 2018, helped by the removal of the Goods and Services Tax and that it will remain favourable to consumers in the near future due to low energy prices.

The Bagan MP also highlighted that the ringgit had risen to RM4.14 to US$1, from RM4.20 in November 2018 when it was at its weakest.

“Finally, Malaysia still has a sizeable current account surplus of RM22.7bil or 2.5% of GDP as at end September 2018, with the positive current account balance expected to persist this year as well,” he said.

“This is partly the reason why Malaysia’s international credit ratings have been maintained, and the reason Bloomberg placed Malaysia as the best among 20 emerging markets for investment.”

Lim said the domestic banking system continues to have sufficient liquidity while the monetary system is healthy and stable.