The global economy is looking bleak, and the relatively austere 2014 National Budget tabled in October last year signals a tightening of belts all over the country. As nations in the region and the world struggle to cope, how will their decisions affect Penang, and how will Penang deal with a slowdown in the E&E industry?
While Malaysia may still be experiencing the reverberating effects of the 2008 global financial crisis, its economic growth rate in 2012, at 5.6%, is more than double those of developed countries such as the US and Japan. Investments in 2012 were impressive: gross fixed capital formation increased by 19.9% and private investments increased by 21.9%. Commodity-related sectors such as mining, agriculture, rubber and plastics manufacturing contributed most to this upsurge, while the government’s Economic Transformation Programme (ETP) provided incentives for oil and gas private investments. In Penang, the housing boom is evidence of the increase in private investment in the state.
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