FINAL EXAMINATION: ASSIGNMENT BASED EXAMINATION

PROGRAMME: BACHELOR OF BUSINESS ADMINISTRATION

MODULE TITLE: MALAYSIAN ECONOMIC

MODULE CODE: ECO 3023

NAME: AHMAD SHAHRASTANI BIN ISMAIL

STUDENT ID: BBAP18011159

 CONTENT PAGE
Q1 - PART A 3
Q2 - PART A 3
Q3 - PART A 4
Q4 - PART A 4
Q1 - PART B 5
Q2 - PART B 6–7
Q3 - PART B 8
REFERENCES 9

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Q1 – PART A

1) The Malaysian economy, along with others in Asia, was exposed to tremendous pressure
last year as a consequence of the increasing Sino-US trade war and rising prices. The
mining sector was particularly hard hit, and BNM responded to its yield curve ahead of
schedule in Jan.
2) As the incidence of infection in Beijing seems to be, production in China has plummeted
as the arrival has created substantial business turbulence, and global mainland Chinese
tourism is quickly declining.
3) The economic is being supported by very strong private consumption, which is a positive
shift in the economic. More importantly, capital enterprise may be revoked.
4) Due to the extreme epidemic in its biggest trading partner, Malaysia's administration,
which has forecasted 4.8 percent annual growth this year, has already been preparing a
stimulus program for aviation, commerce, including tourism.
5) Malaysia's GDP increased by 3.6 percent year on year in the fourth quarter, the most in a
decade, due to lower palm oil, crude oil, and natural gas output, as well as a decline in
exports as a result of the US/China trade war.

Q2 – PART A

1) Chinese tourists visiting the rest of the world are considerably fewer.
2) In China, the market has decreased as the pandemic caused major economic disruptions.
3) The mining sector was particularly hard hit.
4) Foreign currency risk refers to the probability of what should be expected.
5) During the US-China trade war, the output of palm oil, crude oil, and gas fell, as did
shipments.

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Q3 – PART A

1) The government's fiscal conservation is still being ensured.

2) The right policy mix to assist the private industry.
3) BNM responded in January by lowering its reserve requirement ratio as a precaution.
4) Despite this, the GDP is supported by very robust private sector spending.
5) concentrating on a stimulus program for aviation, retail, plus tourism

Q4 – PART A

Malaysia's economic downturn emphasized this with a stronger social welfare state. The
present government's intention to revise and raise the national average is a major confidence
booster.

Malaysia must give help to low-income households. This entails increasing financial
flexibility to allow the federal government to respond properly to emergencies. Nonetheless,
political action will be needed to achieve the desired outcome in the Legislature. Malaysia's
economy is in a state of emergency.

The authorities need to do more to protect the most underprivileged, extremely sensitive
jobs and individuals. Whenever restrictions are lifted, certain business sectors (such as
production) will return to prosperity faster than others (such as hospitality).

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Q1 – PART B

At the outset of 1998, it was clear that the IMF's strongly anti fiscal policy were
ineffective. Dr. Mahathir, Malaysia's then-Prime Minister, changed direction, establishing the
Financial Stability Oversight Board and consolidating policies and outcome. In July 1998, the
Economic Development Recovery Document was approved. It is viewed as a viable alternative
for conventional IMF methods. The goal was to keep the country's currency, restore asset values,
preserve macroeconomic viability on the financial sector, restructure corporate bonds, securitize
and restructure the commercial banks, and revitalize the economic.

Malaysia did not seek International assistance because to its very small amount of global
debt. In the midst of the turmoil, nonetheless, the IMF's traditional advice was implemented. In
terms of monetary policy, it raised the minimum wage to prevent inflationary pressures,
circulated currency to promote direct exchange rate movements, and cut government expenditure
by 18%. On the financial sector, Malaysia has reduced its ou pas loan criterion from six to 3
months' receivables in accordance with international standards. Unfortunately, the
implementation of these policies soon turned into a total economic disaster as a macroeconomics
crisis erupted.

The administration has established a number of committees to restructure both monetary

and non-enterprises. It guaranteed bank deposits and chose to merge, restructure, and revive
failing financial firms rather than shutting them down, which would worsen the economic
depression. Danaharta (Debt Relief Agency) was formed in June 1998 to acquire over and
restructure banks' pseudo loans in order to accomplish this. Danamodal was founded in August
1998 to prop up the economy and restructure struggling commercial banks. Additionally, the
Financial Stability Oversight Committee was formed to assist businesses in negotiating and
arranging their obligations with their creditors.

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Q2 – PART B

To begin with, privatization should reduce the administration's pay expenses, particularly in
the areas of social infrastructure. The rapid expansion of state services was often seen as a source
of worry throughout the 1980s. As a result, reducing the state's interest and influence was
generally evaluated.

Moreover, privatization was portrayed as a mechanism for boosting competitors, reducing

costs, and growing the economy by delivering services. This was a nave viewpoint that conflated
the issue of land ownership with the issue of competitiveness.

Furthermore, the privatization of private businesses and investment are expected to increase.
There seems to be a common, but naive, belief that privatization would promote private
enterprise if there is conclusive evidence in Malaysia or elsewhere that privatization is
predominantly available to fill the void left by privatization.

Finally, privatization is anticipated to reduce state sector exclusivity, but there are no
indications that privatized government firms' conglomerates have been substantially reduced.
Certainly, technological development and advancement, such as communications, are much
more significant than improvements in intellectual property represented by privatization in
dissolving privatized cartels and reducing consumer prices.

The solution must be decided conceptually based on evidence and could be asserted in
advance. What good does privatization serve if an institution has a scarce resource? It often
indicates a shift to private ownership, which may be inconvenient and perhaps detrimental to the
broader public.

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Q3 – PART B

We might support infrastructure development by strengthening the agriculture industry

and correcting urban renewal disparities, particularly in less industrialized regions. Sustainable
agriculture serves as a means of raising the standard of living and economic success of people
who live in relatively distant and densely populated areas. Generally, the agricultural sector has
been centered on property primary resources such as agricultural production. Despite this, the
character of rural areas has changed as a consequence of increases in industrial services and
better urbanization. Hospitality and specialized producers, including leisure, have steadily taken
the place of energy production and agribusiness as the principal business drivers. Rural
communities must approach growth from a wider perspective, instead of providing rewards for
agriculture or financing businesses, and must concentrate on a broader range of development
goals.

Fundamentally, agriculture is beleaguered by inherent issues such as land degradation,

underfunding, and rising input prices. As a consequence, smallholding output, yield, and
profitability continue to lag behind those of estates. The current plan of maintaining a
predetermined price cap for paddy, along with structural problems, has resulted in persistent
wastage in paddy production. Due to various price control and network actions by the
government, structural problems have become embedded and costly to correct. Grants to farmers
are now politicized as election tools, making implementing adjustments much more onerous.

Agriculture made a significant contribution to economic output and export earnings, as

well as to growth. Eventually, the agricultural sector will be driven by increased cattle
production, aquaculture, and a variety of crops. The NAP calls for a lengthy strategy that is
cohesive and coordinated in order to achieve effective agricultural sector development. The NAP
pushed for agro-industrial linkages, namely for the refining, storing, and distribution of
agricultural goods via increasing development of Agri-based companies, in order to improve
their value-added prior to export.

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 The industry has benefited not just the resource-based industries as a major material
supplier, but also food production. Food production capacity is experiencing a growing number
of challenges, including an anticipated world population of over 9 billion by 2050 and a
decreasing proportion of arable land to the population. According to the Food and Agriculture
Organization of the United Nations (FAO). These agricultural losses would be exacerbated if
present pesticide use was discontinued and food prices rose significantly. Plants are attacked by
pests and diseases long after they have been harvested. Grain may be harmed by bugs, rodents,
or mold. Aside from increasing crop yields, crop protection chemicals used in stored products
may also increase the usable life of produce, prevent significant losses due to pests and diseases
after harvest, and preserve food so that it is safe to eat. The primary aim of the crop protection
industry is to enable farmers to produce an adequate food supply in a safe manner while avoiding
increasing costs. Food production processes benefit from the continual advancement of
agricultural technology and techniques. In fact, almost twice the population today has more food
per capita than 40 years ago.

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REFERENCES

Is privatization beneficial to the public? (November 1, 1991) Harvard Business Review is a

business journal published by Harvard University. https://hbr.org/1991/11/does
privatization-serve-the-public-interest

Malaysian financial downturn: causes, consequences, recovery measures, and lessons gained
(n.d.). Home of Calhoun. https://calhoun.nps.edu/handle/10945/9273