Former finance minister Tengku Razaleigh Hamzah disputed the government and Bank Negara’s stand on the Gross Domestic Product (GDP) forecast of 3.5 percent this year, saying it should be much lower now because of the global economic crisis.

Speaking at a press conference during the Asian Strategy and Leadership Institute forum in a Kuala Lumpur hotel today, Razaleigh said he would rather “stand near 0.5 percent” as forecasted by CitiGroup Global Market recently.

asli forum tengku razaleigh economy 150109 04 “I stand nearer to 0.5 per cent...one or two per cent might be accurate. It could be the right estimate, but it could also get worse,” he said.

Razaleigh, who is also a former international trade and industry minister described the forecast of 3.5 per cent as “so bold when things are slipping through our fingers” and “nobody would know what is actually happening.”

Yesterday, Citigroup Global Market had downgraded its forecast for Malaysia's 2009 GDP to 0.5 percent from 3.1 percent previously amid a slowdown in economic activities and the GDP growth for the first quarter of 2009 is expected to be -0.9 percent.

The government on the other hand, had forecasted 3.5 per cent of GDP during the RM7 billion stimulus package announced by Deputy Prime Minister Najib Abdul Razak late last year.

The package included injecting RM4.8 billion into the economy through a reduction of contributions to the EPF retirement fund, RM1.2 billion to build low- and medium-cost houses and hundreds of millions of ringgit for the building, improvement and maintenance of basic infrastructure and public amenities.

Bare RM7 billion stimulus package

Earlier in his keynote address , Razaleigh, who is also Gua Musang MP said the government should “come to its senses and stop being in denial” about the global recession by laying bare the RM7 billion stimulus package and where the money is channelled to.

He said a “proper assessment” of the package should be made known even before having the stimulus package in the first place.

“The government should come out and start telling people the truth so that the people can prepare themselves to brace the economic crisis,” he said.

Razaleigh stressed at the press conference on the RM7 billion stimulus package and that the government should find ways and means to spend the money wisely.

“If you think RM7 billion is not worthwhile, then what is worthwhile? Can't you do a proper assessment of the situation? How deep is the recession? How much is really required?

“If you say RM20 billion, alright. Find ways and means to spend that to help the country and the people, especially the low-income (earners),” he said.

During the question-and-answer session with the audience after his speech, Razaleigh also suggested that the government should come up with a similar body as the NEAC (Malaysian National Economic Action Council) that was established during the 1997 economic crisis.

“The (new) council should constitute measures similar to that (council) to look for drastic measures...but the government is still in denial (over the recession),” he said to laughter from the audience.