3.5% Growth my butt.

http://www.themalaysianinsider.com/index.php/malaysia/12812-nor-mohamed-confident-of-35pc-gdp-growth-next-year

"However, he said, Malaysia managed to gain an edge during the current global financial crisis by promoting Islamic finance as an alternative system."
The Anglo-Saxon financial system is crumbling because its architecture is unsuitable, incomplete and unfair. We warned the world about this in the financial crisis 10 years ago but we were ignored,” Nor Mohamed said.

Er. Has he even taken a look at what shape the Islamic Bank stocks are in right now? The Islamic model of economy seems to be: depend on oil. If oil sinks, you are all doomed.
... I could be wrong though. Still, watch the utter havoc in Middle East economies if oil stays at this level.

As for Malaysia, here is my forecast of the damage to our GDP:

First off, our GDP roughly consists of: agriculture: 8.6%, industry: 47.8%, services: 43.6% (2007 est.)

Palm Oil exports likely to remain stable, maybe even increase. But the fact that price per ton has dropped over 60% means that we will lose at least 3% GDP.
Oil... we don't really export that much, relative to our local consumption. Still, we can expect to take a hit of around 2% GDP from oil related exports.
As for local consumption, I would say it's a hit of another 3% GDP. (though in real terms, a fall in fuel prices locally means that real cost of living drops and thus GDP in purchasing power parities will go up to balance this)
Electronics: I have no idea what the drop in international sales here would be next year. I admit that I am only throwing a wild guess when I say 10% fall. Which would come to another 2% drop in GDP I guess? Really not sure here.

So far, I have not even talked about local consumption, effects of employment falls, and so forth, and we're already looking at a drop of 10% in 2009... I expect, in sum total, for the 2009 recession to be worse than 1998, and my own personal guess is a 12% contraction in GDP for 2009, and a further 6% contraction in 2010.

Well... we shall see what the results turn out to be... I could turn out to be wrong of course. But remember: during 1998, industrial demand was still high. This time around, industrial demand is falling really badly. Furthermore, it looks likely that China will undercut Malaysia in industrial supply. BADLY undercut Malaysia, in fact. So I expect this crash to be much much worse than 1998. Incomparably worse, in fact.

Still... the housing prices have not really moved yet. So, looks like I might be jumping to conclusions. My opinion is definitely to watch those property prices and employment figures.
BTW... the profit figures for companies are now beginning to turn sour. And remember that our country does not have unions which grant huge severance packages to laid-off employees, like America does. So it's not that difficult for a company to dump a huge number of workers in a short amount of time... they can always rehire them easily if the economy picks up again, after all.


Summary: Regardless of what our government claims, everyone knows that Malaysia is headed into a recession. The only question is the depth of it's severity. BTW, I seem to recall them projecting a 5% growth in 1998, which turned out to be a 7.5% contraction. Lunatics.