To a large extend it all depends on the external environment - since Malaysia's economy is so dependent on external trade. If the economies of Japan, Singapore, America and Europe more into high-gear recession, the demand for Malaysian goods will be sluggish and this will have a negative impact on the situation in Malaysia. If outsiders do not buy our exports - we are in for trouble.
Notwithstanding this, the government policies to stimulate the economy through higher spending, lower interest rates and relaxed lending guidelines have started to bear fruit：
□ Average lending rate has declined from 12.27% in June to 8.05% in November 10. This is a big relief to business. The BLR before the economic crisis was 9.5%;
□ Inflation has stabilised around 6%;
□ Unemployment rate has stabilised at 3% in the 3rd quarter. On a monthly basis, retrenchment slowed down to 7,105 in October from a peak of 12,375 in July;
□ For the 1st ten months, Malaysia had recorded a trade surplus of RM44.5 billion in contrast to a deficit of RM1.7 billion in the same period last year, exceeding an earlier projection of RM35 billion for the entire year. The October surplus of RM6.6 billion was higher than the surplus for September (RM6.20billion); and
□ The nation's reserve rose to US23.6 billion as at November 14 enough to finance 4.5 months of imports [from 22.04 billion in October 15]. The country's external debt position has also showed improvement with total external debt falling by 12.7% to RM150.4 billion. There is also a significant decline in short-term debt which fell from 22% in the second quarter to 18% in the third;
