MALAYSIA needs to strengthen economic fundamentals rather than have frequent stimulus packages to deal with a slowdown.
Malaysia reported a slower second quarter economic growth of 8.9 per cent from 10.1 per cent in the first quarter. The official full-year forecast is 4.5 per cent to 5.5 per cent but Bank Negara Malaysia expects growth to be better than 6 per cent.
Najib expects minimal impact from problems in Europe and said it would not derail Malaysia's growth target.
"The impact for this year is minimal but we must constantly monitor the developments outside the country and at the same time, work to ensure that domestic demand is at a strong level," he told reporters after chairing the National Finance Council meeting in Putrajaya yesterday.
Najib also does not expect a stronger ringgit to hurt Malaysian exports although there will be a small impact. A stronger ringgit makes our products more expensive abroad.
The ringgit climbed to a 13-year high on Thursday after Bank Negara Malaysia further relaxed currency controls imposed in 1998 and reported a bigger-than expected rise in gross domestic product.
But the country needs more investments to stimulate economic activities, said Prime Minister Datuk Seri Najib Razak.
"If we do this and projects with multiplier effects on the economy are implemented, then even with a slight drop in external demand this year, we can still achieve our 6 per cent target," he said.
Malaysia reported a slower second quarter economic growth of 8.9 per cent from 10.1 per cent in the first quarter. The official full-year forecast is 4.5 per cent to 5.5 per cent but Bank Negara Malaysia expects growth to be better than 6 per cent.Although the International Monetary Fund raised the world's 2010 growth forecast to 4.6 per cent from 4.2 per cent in July, it said Europe's debt crisis was a big risk to global recovery.
"The impact for this year is minimal but we must constantly monitor the developments outside the country and at the same time, work to ensure that domestic demand is at a strong level," he told reporters after chairing the National Finance Council meeting in Putrajaya yesterday.
Najib also does not expect a stronger ringgit to hurt Malaysian exports although there will be a small impact. A stronger ringgit makes our products more expensive abroad.
The ringgit climbed to a 13-year high on Thursday after Bank Negara Malaysia further relaxed currency controls imposed in 1998 and reported a bigger-than expected rise in gross domestic product.
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