I had a chance meeting with a friend, who was having a discussion with a group of politicians and businessmen, a few days ago. What can we expect from that kind of discussion? The politicians were of course very angry with the way that some bloggers had been trying to demonize the state leadership and the government to such an extent that they are portraying Sarawak as backward State under a corrupt a leadership.
Some bloggers go to the extent of claiming a certain leader had to sign a secret agreement with the family members about his shares in their business. But if it is a family secret how come an outsider knows and posts it in a website? The businessmen believe that the allegations being made against the leadership, some half truths or outright lies have no effect on the investment climate in the state. For goodness sake, Sarawak is a progressive state with every potential to become the richest state in the country by the year 2030.
Actually, the state is attracting a lot of investments especially for projects in Sarawak Corridor of Regional Economic Development (SCORE). At least RM30 billion has already been committed for the development of aluminum smelting plant, the pulp and paper plant and the exploitation of huge reserves of coal in Mukah and Kapit divisions.
My interest is to keep myself up to date with the events and happenings in and outside the country. As I have more time for myself, I read at least five newspapers a day. In the evening I pick my news from RTM’s Regional News, BBC and CNN. I also make it a point to attend meetings of State Legislative Assembly or Parliament whenever I can. I attended the last budget session of the State Legislative Assembly and took note of the fact that the state would be having a surplus budget for 2010.
Chief Minister, Pehin Sri Haji Abdul Taib Mahmud, who is also the Minister of Finance, in tabling the budget says the budget has been formulated after taking into consideration the strategies and provisions of the 2010 National Budget and the global, regional and national economic scenarios.
The Budget has the following objectives
(a) to generate a high level of economic activities in order to sustain economic growth;
(b) to ensure a long-term financial sustainability with a budget surplus of RM161 million in 2010;
(c) to optimize the use of available resources like equipment, facilities and human capital;
(d) to give priority to economic activities and productive sectors such as Commerce and Industry, Public Utilities, Transport and Communications, Agriculture, and Rural and Land Development;
(e) to ensure a balanced distribution of development resources and services in order to narrow the development gap between the rural and urban areas;
(f) to provide conducive environment for private sector as the main engine of growth;
(g) To give special focus on enhancing the effectiveness of the State Government financial management and efficiency of the delivery system; and
(h) To provide sufficient fund for the long term social and economic restructuring, and transformation plan for the state.
Clean Bill of Health
A thing of great interest to me was the announcement that the Auditor General of Malaysia has, for the seventh consecutive year, given a clean bill of health to the State 2008 Public Accounts. It is a commendable performance, which all Controlling Officers comprising heads of Ministries, Departments and Agencies must work hard to sustain in order make Sarawak remains attractive for investment. The observations and weaknesses, being highlighted in the Auditor General’s Report, must be viewed seriously and take remedial actions to ensure that the weaknesses do not recur.
Sound financial position
More importantly, the State also maintains commendable investment grades during the same period. The State’s credit rating position is maintained at investment-grade status despite the global financial and economic turmoil. Moody affirms the State’s investment-grade credit rating at Baa1 with a slight revision upward from stable to positive outlook, while Standard & Poors maintains the rating at A- with stable outlook. The ratings indicate a strong confidence of the international rating agencies on the State’s sound financial position and effective financial and fiscal management. Nonetheless, the State must not be complacent as it is more critical now for the state to sustain the credit ratings to attract direct and indirect investments in a bigger way for the future.
The socio-economic development of the State has been achieved through comprehensive and balanced development plans. However, a good and comprehensive development plan alone is not sufficient if it is not being supported by efficient delivery system. Obviously, the State government is fully committed in ensuring that good project management principles be practiced by government agencies at all levels. The projects must be implemented smoothly The systems and processes must be improved all the time to enhance effectiveness in the implementation of projects.
Conscientious efforts must be made to upgrade the efficiency of transport and communications network, which is a prerequisite for economic development of the state. Enormous sums of money have to be allocated for such development, given the size and geographical conditions of the state, in order to bring it to a higher standard. The increase in public expenditure and private sector involvement in the development of infrastructure and utilities reflect the commitment and determination of the State Government to prepare the state for greater competitiveness.
Quite obviously the Federal Budget has also included various programs that have direct impact on the state for the benefit of the people. The projects include:
(a) Refurbishing and upgrading of schools, building of clinics, construction of rural and village roads, and supply of water and electricity especially for the rural areas in the State;
(b) Poverty eradication programs; and
(c) Access roads to Murum and Baram hydro dams.
The National Budget for 2010, as presented by the Prime Minister, Dato Sri Hj. Mohd Najib Tun Abdul Razak, also focuses on advancing the role of the private sector as the driver of economic growth; developing high-skilled human capital and enhancing the efficiency of the public service. The National Budget with the theme of “1 Malaysia, Together We Prosper” focuses on the following three strategies:
(a) Driving the Nation towards a High-Income Economy,
(b) Ensuring Holistic and Sustainable Development, and
(c) Focusing on Well-being of the Rakyat.
The National Budget also aims to strengthen Small and Medium Enterprises or SMEs. It provides a sizeable sum of about RM890 million for the implementation of various development programs , providing soft loans, enhancing capacity and branding promotion for the SMEs. These are the additional funds in addition to the existing six SME funds with total amount of RM13.4 billion being administered by Bank Negara. The SMEs in Sarawak should to take full advantage of the facilities and programs.
The government proposes a sum of RM2,777 million for Development Expenditure in 2010. It is committed to complete the implementation of projects approved under the Ninth Malaysia Plan. Out of the total provision, RM2,249 million will be funded by the State while RM528 million will be funded by the Federal Government through reimbursements and loans. The allocation for development expenditure budget for the year 2010 will be made as follows:-
(a) RM1,271 million or 46% of the total development expenditure is for commerce and industry sector. The projects and activities include investments, development of industrial estates and tourism. These also include development grants and loans to statutory bodies;
(b) RM493 million or 18% of the development expenditure is for the expansion and upgrading of various public utilities, mainly water supplies in both rural and urban areas;
(c) RM316 million or 11% of the expenditure is meant for improvement of government facilities to further enhance the government’s delivery system;
(d) RM213 million or 8% is for agriculture, land and rural development sector. The provision is mainly for plantation development, drainage and irrigation, assistance to farmers, veterinaries, fisheries, agricultural research and forestry programs;
(e) RM277 million or 10% of the expenditure is for transport and communications especially for roads, bridges and ports; and
(f) RM207 million or 7% is proposed for social and community development sector, such as:
(i) Housing and resettlement schemes,
(ii) Sports and recreational facilities, and
(iii) Community and welfare services.
Budget Surplus 2010
The State must continue to spend within its means to ensure sufficient financial reserves to meet future challenges. More importantly the State’s financial position must remain strong and sustainable in the long run. Necessary steps must continue to be taken to improve the financial management to ensure the capacity, efficiency and effectiveness of the Financial System. In this respect all Ministries, Departments and Agencies must comply fully with the financial regulations and instructions that have been issued by the central authority. Stern actions must be taken for non-compliance as compliance is the key to ensure high level of accountability and transparency in the public service.
Financial compliance must be made a work culture in order to enhance the overall level of the financial management and achieve a higher level of integrity, credibility and accountability of Ministries, Departments and Agencies.
Besides, all government agencies including all Statutory Bodies and GLCs must strive for continuous improvement in their financial management and uphold the value of accountability at all times. With the 1Malaysia spirit, Sarawak should get more fund for the construction of roads, bridges, development of housing projects, education, health and the development of infrastructure for the extension of water and electricity supplies to rural area. In this respect, the Federal Government should be sympathetic to requests for achieving the Key Result Areas of Balanced Regional Development and Accessibility to Physical and Social Infrastructures.
The state’s success to migrate from the medium income economy to a high income economy depends on efforts to upgrade the workforce and increase their knowledge input into their work. As the global economic environment will continue to be very challenging, it is critical for the State to adopt prudent financial management policy and at the same time maintain the tempo of development at a sustainable level.
benuasains
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