Pakatan Harapan’s manifesto pledges unrealistic, will harm nation’s economy, says Fitch Group’s research arm

PH’s unrealistic manifesto makes its credibility among voters questionable, says BMI Research

BMI Research, an international research firm, believes that Pakatan Harapan’s pledge to deliver 10 promises in 100 days is detrimental to the economy.

The firm, a unit under Fitch Group, said PH would struggle to implement its ambitious pledges, which were populist in nature and aimed at addressing people’s complaints against the ruling government.

The unrealistic nature of the manifesto, despite the popularity of the pledges, made PH’s credibility among voters questionable, it added.

“Considering that the Goods and Services Tax (GST) accounts for 17.9 per cent of the government’s revenues and has been growing steadily since the share of 13.7 per cent in the second quarter of 2015, its abolishment would place pressure on the government’s revenues,” BMI said in a statement.

The increase in subsidy payouts would also add to the pressure, with the share of subsidies falling to 5.3 per cent in the third quarter of last year, from 16.8 per cent in the second quarter of 2010 as part of the administration’s subsidy rationalisation (which started in July 2010), it added.

BMI said businesses, in particular, were unlikely to be receptive to the pact’s pledges, especially with reports of smaller companies struggling to cope with the minimum wage, which PH had vowed to increase further.

Citing China as an example of one of Malaysia’s largest investors and trade partners, BMI said promises to review contracts of large infrastructure projects could jeopardise Malaysia’s good ties with the country.

“The detailed probe into foreignfunded mega projects could also strain ties with China and potentially alienate the Chinese-majority DAP’s support base, with many Chinese supporters having a favourable view of Beijing.”

BMI Research suggested that PH would have done better to focus its manifesto on institutional reforms, which it said had served the defunct Pakatan Rakyat pact well in the last two elections.

“However, we believe that the implementation of many of these reforms will be extremely challenging, especially since many of these systems were implemented under (Tun Dr) Mahathir (Mohamad).”

However, we believe that the implementation of many of these reforms will be extremely challenging, especially since many of these systems were implemented under (Tun Dr) Mahathir (Mohamad).