KUALA LUMPUR, March 5 (Reuters) - Malaysia’s Deputy Prime Minister and Finance Minister Najib Razak will present a second round of government spending to try to boost the troubled economy on March 10.
For Najib, there is more at stake than rescuing this export-dependent Asian country of 27 million people from the global slowdown, which has seen exports haemorrhage and growth drop, as he will become prime minister on March 31.
The question is whether this political blue-blood, who is the eldest son of Malaysia’s second premier, Abdul Razak Hussein and who won his late father’s parliamentary constituency in 1976 at the age of 22, will spend his way out of a possible recession.
Najib, 55, is a British-trained economist and has held two other ministerial posts that may give clues as to whether he will spend heavily.
Speculation in the market ranges from a spending package that will be worth 10 billion-15 billion ringgit ($2.7 billion-$4 billion) or to up to 30 billion ringgit, based on comments from a junior finance ministry official in the local press. That same official said on Thursday that the spending would be 10 billion ringgit or more. [ID:nKLR84509]
Will Najib be a lavish spender?
He held two key ministerial posts prior to becoming deputy prime minister and finance minister, in education from 1995 to 1999 and defence from 1990 to 1995 and from 1998 to 2008. Najib oversaw the spending of some of the biggest allocations to the ministries he led.
As education minister, Najib oversaw the spending of a 490 million ringgit allocation to build housing for teachers posted to rural districts under the country’s Seventh Malaysia Plan development blueprint.
He also managed a 1 billion ringgit allocation for the education sector in 1997, part of a 7 billion ringgit allocation to stimulate economic growth in the light of the Asian financial crisis of 1997-1998.
As Defence Minister, Najib managed the largest modernisation exercise of the armed forces in recent years. He signed major procurement deals such as a 3.42 billion ringgit deal for 18 Russian Sukhoi fighter jets and a 4.6 billion ringgit package for two French submarines.
Does Najib have a populist streak?
As education minister, Najib was instrumental in promoting more than 3,000 long-serving teachers stuck in their salary grades for a number of years, and boosted non-graduate teaching salaries by up to 40 percent.
Upon being appointed deputy prime minister in 2004, Najib was given a broad portfolio of responsibilities.
This included oversight of the Federal Land Development Authority (FELDA), an agriculture land scheme for the poor developed by his father.
Najib introduced numerous infrastructure and benefits for the 115,000 mostly Malay landless families under the scheme, as well as annual incentive and bonus payments.
What does this all say about the man who will be PM?
Najib is highly adept in effectively deploying financial allocations to ensure the welfare of his ministerial constituents.
This has in turn has built up a deeply entrenched grassroots support for Najib among the country’s teachers, armed forces personnel and the mainly rural FELDA settlers.
Combined, the three groups make up a powerful support base for the incoming premier.
Najib’s record provides glimpses of a politician not averse to major spending and populist measures to cultivate and boost political support. (Reporting by Razak Ahmad; Editing by Alex Richardson)