Strategic package to combat impact of global turmoil in the longer term

PUTRAJAYA: The Government is likely to introduce a strategic package to combat the impact of the global economic downturn for the medium to long term, according to Minister in the Prime Minister’s Department Tan Sri Amirsham A. Aziz.

Amirsham said the Government would need to assess the impact of the RM7bil stimulus package first which it deemed as a short-term measure to prop the economy.

“There’s no time line set to introduce the strategic package but it would be geared towards measures to improve the delivery and competitiveness of the country, possibly through greater policy liberalisation to attract more foreign direct investments (FDIs),” he told reporters after a briefing and panel discussion on strengthening the Malaysian capital market yesterday.

Amirsham said measures would also be taken to support the private sector as it was the key engine of growth to boost the economy and the service sector would be an area of keen interest.

On Tenaga Nasional Bhd (TNB), he said it had an interest in operating the RM6bil Bakun hydro-electricity project but did not intend to own it.

“TNB has an interest in having a stake in the RM9bil to RM10bil sub-sea cable project to supply 1,600MW to 1,800MW hydro-electricity to Peninsular Malaysia from Sarawak, via a consortium,” he said.

On the energy issue, Amirsham said there was a need to look at ways to produce energy at a more efficient manner and to be less dependent on coal and the independent power producers (IPPs).

“We are looking at gas as a cheaper energy source but there is not enough of gas locally for the nation’s energy requirements,” he said, adding that most of the contracts with existing IPP owners would be expiring in three to five years.

He said the Government was reviewing its future energy needs and energy sources to be more efficient.

The briefing and panel discussion, organised by the Economic Planning Unit for fund managers, capital market specialists, investors and rating agencies, was aimed at strengthening cooperation between the Government and the private sector to look for practical ways to improve the vibrancy of the Malaysian capital market in the wake of the global economic slowdown.

Some of the issues raised at the discussion included how to improve the bond market, FDIs, enhancing transparency, accountability and corporate responsibility, ways to resolve credit crunch, and making Bursa Malaysia more attractive to foreign investors.

Bursa Malaysia chief executive officer Datuk Yusli Mohamed Yusoff, who was one of the panel speakers, said the stock exchange was targeting to introduce an FTSE Bursa Malaysia Asian Palm Oil Plantation Index by the first quarter 2009.

“The introduction of an index covering Asia Pacific countries ex-Japan, Australia and New Zealand will be in line with the exchange’s strategy to profile Malaysia as the centre of commodity products,” he said.

He added that the exchange was currently in talks with an issuer to launch an exchange-traded fund on the index.

Other panel speakers included Securities Commission chairman Datuk Seri Zarinah Anwar and RAM Holdings Bhd executive deputy chairman Tan Sri C. Rajandram.

The Star-Danny Yap