First things first, credit must be given where its due. Budget 2009 does go some way in addressing the day-to-day hardships faced by the lower income group.

On the surface, it appears to offer a lot of goodies to the common folks and lowers some tax burdens.

However, I have to agree with Anwar Ibrahim that Budget 2009 does not address any fundamental structural issues facing the Malaysian economy.

For decades, the Malaysian economy has been blessed with a significant comparative advantage by having strong rubber, oil palm, electronic and petroleum industries.

The problem is one can never rely on his comparative advantage forever. The rubber and oil palm industries rely heavily on low-wage and unskilled workers which lead to heavy reliance on foreign immigrant workers.

Having some foreign low-wage workers is not uncommon. Nevertheless, in the case of Malaysia, the number of low-wage, unskilled foreign workers now makes up over 10 percent of the population.

This vast amount of foreign workers is staggering and it has already caused numerous social problems in society, not to mention the leakage of foreign exchange to the immigrant's host countries.

Then, there is the petroleum industry. It is a real money spinner, but only while it lasts. Petroleum is a non-renewable resource and it will be gone sooner or later. What is going to happen to the economy when the oil wells run dry?

What I am trying to point out is that Malaysia has failed to build its competitive advantage to supplement its comparative advantage. Without a competitive advantage, the Malaysian economy will go backward.