Asia Economy

The Malaysian government is continuing its campaign to reform the nation’s economy, broadening its base and liberalising many previously restricted sectors. However, its most recent moves to rein in subsidies, which are designed to reduce the strain on the budget, may prove unpopular and could stoke inflationary fires in the short term.

Indonesia’s newly published economic master plan sets out ambitious targets to become one of the world’s biggest economies over the next 15 years. The plan unveiled by President Susilo Bambang Yudhoyono (SBY) also put the spotlight on the need for heavy investments in infrastructure coupled with improvement in the investment climate.

Following a strong year in 2010, Malaysia’s manufacturing sector looks set for a repeat performance in 2011 in its effort to draw in foreign investment. The Malaysian Investment Development Authority (MIDA) is setting a target of bringing in RM55bn ($18.22bn) in new investment for the year.

The government of Thailand is struggling to maintain a balance between its efforts to lower the budget deficit and its policy of mitigating the impact of rising prices, with fiscal prudence coming into conflict with social responsibility and political expediency.

The need to relax rigid labour restrictions that enforce high severance pay and make it hard to fire staff is becoming a priority for Indonesia. With outdated employment laws affecting investor confidence and benefitting neither employers nor staff, the country is accelerating moves to update employment regulations.

The digital age will be heading deeper into the heart of Borneo soon – that was the message delivered by Deputy Information Communication and Culture Minister Datuk Joseph Salang Gandum in Sarawak recently. The Minister said in early December that more than 500 villages in Sabah would gain access to the internet via satellite next year as part of the “Kampung Wi-Fi” project.