<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR>Malaysia unveils measures to avert economic slowdown
</TR><!-- headline one : end --><!-- Author --><TR><TD class="padlrt8 georgia11 darkgrey bold" colSpan=2>By Hazlin Hassan, Malaysia Correspondent
</TD></TR><!-- show image if available --></TBODY></TABLE>
<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->KUALA LUMPUR: Malaysia will scrap import taxes on some raw materials and make it easier for companies to get manufacturing licences, as part of measures to fend off a slowdown.
Manufacturing licences will be issued automatically for all industries except sectors such as health care, security, safety, environmental and religious activities.
The measure, which takes effect from Dec 1, should boost foreign direct investment, said International Trade and Industry Minister Muhyiddin Yassin yesterday.
The licences will be issued without the need for renewal and the fee will be dropped.
Import duties on materials used for domestic manufacturing will also go. This affects more than 400 products, including iron, steel, textiles and chemicals that now carry levies from 5 to 30 per cent.
This will reduce the government's earnings substantially, but the cost has not been calculated, said Tan Sri Muhyiddin.
'There are projections that the global slowdown can stretch for up to a year. We are very concerned. We are taking these measures to help companies and businesses deal with a very difficult situation,' he added.
The export ban on scrap metal has been lifted with immediate effect. The government is also considering exempting other raw materials and goods from import duty, but no details were given.
Mr Muhyiddin said the government would this month unveil further plans to liberalise the services sector, as well as more incentives for manufacturers.
The moves come after the government announced an additional RM7 billion (S$3 billion) of public spending to boost growth.
Earlier this month, it cut its growth prediction for next year to 3.5 per cent from 5.4 per cent. This would make it the slowest growth in eight years.
Manufacturing growth is expected to dip to 0.8 per cent next year, down from an original forecast of 4.3 per cent.
While the government has been relatively bullish on the economy so far, Mr Muhyiddin noted that the country's major trading partners, the United States, Europe and Japan, are expected to be in recession next year.
'Malaysia may not be immune' from the spreading crisis as it could affect its imports, he said.
The president of the Federation of Malaysian Manufacturers, Mr Yong Poh Kon, said there have been no retrenchments in the industry so far, but some companies reported a drop of 30 per cent in orders for the next quarter.
Mr Stewart Forbes, executive director of the Malaysian International Chamber of Commerce and Industry, said the iron and steel industries are already suffering.
He predicted the cement sector may also be affected due to a softening in construction. The government's pump-priming RM7 billion package has been allocated for the building of low-cost housing and public transportation, among other things, in order to help prop up the building industry.
</TR><!-- headline one : end --><!-- Author --><TR><TD class="padlrt8 georgia11 darkgrey bold" colSpan=2>By Hazlin Hassan, Malaysia Correspondent
</TD></TR><!-- show image if available --></TBODY></TABLE>
<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->KUALA LUMPUR: Malaysia will scrap import taxes on some raw materials and make it easier for companies to get manufacturing licences, as part of measures to fend off a slowdown.
Manufacturing licences will be issued automatically for all industries except sectors such as health care, security, safety, environmental and religious activities.
The measure, which takes effect from Dec 1, should boost foreign direct investment, said International Trade and Industry Minister Muhyiddin Yassin yesterday.
The licences will be issued without the need for renewal and the fee will be dropped.
Import duties on materials used for domestic manufacturing will also go. This affects more than 400 products, including iron, steel, textiles and chemicals that now carry levies from 5 to 30 per cent.
This will reduce the government's earnings substantially, but the cost has not been calculated, said Tan Sri Muhyiddin.
'There are projections that the global slowdown can stretch for up to a year. We are very concerned. We are taking these measures to help companies and businesses deal with a very difficult situation,' he added.
The export ban on scrap metal has been lifted with immediate effect. The government is also considering exempting other raw materials and goods from import duty, but no details were given.
Mr Muhyiddin said the government would this month unveil further plans to liberalise the services sector, as well as more incentives for manufacturers.
The moves come after the government announced an additional RM7 billion (S$3 billion) of public spending to boost growth.
Earlier this month, it cut its growth prediction for next year to 3.5 per cent from 5.4 per cent. This would make it the slowest growth in eight years.
Manufacturing growth is expected to dip to 0.8 per cent next year, down from an original forecast of 4.3 per cent.
While the government has been relatively bullish on the economy so far, Mr Muhyiddin noted that the country's major trading partners, the United States, Europe and Japan, are expected to be in recession next year.
'Malaysia may not be immune' from the spreading crisis as it could affect its imports, he said.
The president of the Federation of Malaysian Manufacturers, Mr Yong Poh Kon, said there have been no retrenchments in the industry so far, but some companies reported a drop of 30 per cent in orders for the next quarter.
Mr Stewart Forbes, executive director of the Malaysian International Chamber of Commerce and Industry, said the iron and steel industries are already suffering.
He predicted the cement sector may also be affected due to a softening in construction. The government's pump-priming RM7 billion package has been allocated for the building of low-cost housing and public transportation, among other things, in order to help prop up the building industry.
