« August 2015


 January 2016 »




Executive Summary


Looking back at official publications for long-term economic and social development plans, national unity, peace and security are undisputedly the ultimate goals of Malaysia, while structural adjustment programs and stabilization measures are the policy actions, implemented through a variety of instruments to ensure that these long-term goals are ultimately achieved. Meanwhile, the welfare (social wellbeing) of the rakyat as a whole and racial ties are the guiding lights, achieved through a long period of political stability, enhanced harmony and a high degree of racial and religious tolerance, thereby allowing the country to successfully progressed since independence in 1957. Of greater significance, Malaysia has been able to successfully weathered adverse external economic shocks, particularly the Asian financial crisis in 1997/1998 and most recently, the global economic and financial crisis in 2008/2009. Another key milestone that will be achieved, is that Malaysia has not much problem in graduating to a high income economy, according to the latest study by the Asian Development Bank (ADB, ADF2015). Economic development is a continuing process and therefore, income metric alone is not deemed a significant achievement, especially for resource-rich countries, like Malaysia. Most importantly, Malaysia has met her obligations under millennium development goals (MDGs, 2015) and recently adopted the United Nations Agenda for sustainable development (Agenda 2030), while working hard on climate change initiatives. Despite these stellar performances, intergenerational equity, income distribution, social protection and access to education and skills remain key challenges for the Malaysian economy, according to latest country profile on key performance indicators (KPI), compiled by the World Economic Forum. These challenges are important for enhancing national unity, peace, security and most important of all, political stability.

While we have certainly built world class physical infrastructure, well-endowed with well-trained labour force, enjoying strong social capital and living in undeniably a vibrant and blessed country, we need to ensure the high standards of the so-called an advanced economy that we aspire to be by the year 2020 are also embraced and consistently nurtured. These include good governance, strong institutions, civil liberty, social justice, racial harmony and tolerance, equality among citizens, fair and just society, among others. These are norms, values and standards that need to be sustained for a long period of time as a prequalification for the graduation process. Attaining high income is a necessary condition, but its achievement certainly needs to be complemented with good moral and ethical values, better quality of life and higher living standards for the rakyat. Unfortunately, political tensions seem to be on the rise, affecting not only sentiment and confidence of economic agents, particularly consumers, producers, investors and markets as a whole, but also undermining the existing strong social fabric of the society, which we have carefully nurtured in the last 58 years. This unfortunate phenomenon surfaced only very recently, triggered by advances in information and communication technology (internet and social media), unfair review by foreign analysts with vested interests and also undeniably poor governance, weak institutions, lack of public transparency and accountability, among others. These emerging concerns certainly need to be addressed fast and should not be allowed to gain ground under any circumstances. Economic booms and busts; investment bankers and corporate executives gone wild and corporate failures are normal occurrences in matured democracy and deep-rooted capitalist system, especially in advanced economies, as seen recently in "distressed economies" in the euro area and the US sub-prime crisis. These things are unfortunately happening in Malaysia, providing a negative backdrop to economic distress and financial difficulties, triggered not only by greed, fear and panic, but also adverse developments on the external front. These include growth slowdown and market re-alignment in China, and a widely anticipated monetary policy normalization in the United States (US).

These two widely expected events actually represent a healthy development, providing opportunities for achieving the goal of sustainable development for the world economy. As such, we need to quickly adjust to these "new normal", by implementing vigorously structural adjustment and reform programs and correcting whatever mistakes or misadventures on the domestic front. Prudent macroeconomic management should be the key priority, especially in attaining fiscal sustainability and encouraging greater role for private sector investment. We need to minimize maximum loss to the society, taking into account current constraints by implementing "new policy actions", especially through appropriate stabilization measures. Apart from ongoing commodity and currency declines, we are nowhere near the previous crisis in 1997/98, as our FBMKLCI remained well above 1,700, with real GDP growth estimated at about 5%, inflation below 2.5% this year and unemployment rate below the full employment threshold of 4%. Malaysia is certainly not a "failed state" as labelled by critics, and far from a situation where people are risking their lives, seeking asylum in foreign countries; having worthless currency; inflation hitting the roof; bank closures and empty shelves in the supermarkets, as previously seen in authoritarian regimes and countries in conflict.

Nonetheless, the second half of 2015 is expected to be very challenging for the Malaysian economy, having to face not only continued plunge in the prices of commodity exports and foreign exchange (FX) market turbulence, but also bracing for tough political turmoil and unfortunately rising racial and religious tensions. Domestic political turmoil certainly affect consumer sentiment and investor confidence at home as well as abroad. Therefore, protecting Malaysia's good reputation overseas and ensuring policy credibility and predictability at home are urgently needed tasks, while preserving national unity is undisputedly "the mother of all necessity" in Malaysia. We are hopeful that there will be no political earthquakes or draconian measures imposed on the rakyat and society as a whole, which are currently suffering a lot from economic distress and financial difficulties as well as political fatigue. There is also unhealthy haze, resulting in real life suffering, for rich and poor as well as young and old.

Meanwhile, commodity-currency shocks are presently affecting resource-based emerging market economies (EMEs), like Brazil, Malaysia and Mexico as well as advanced economies, such as Australia, Canada, New Zealand and Norway. Adding to these shocks, there are "dark corners", associated with monetary policy normalization in the US, which remain an ongoing and never-ending challenge for many central banks around the globe, despite only a tiny increase expected later this year. The slowdown in China, Yuan devaluation and its financial market turmoil could potentially trigger the worst-case-scenario for the global economy, in terms of "hard-landing" in China. The US Fed has certainly agreed on this long-delayed risk, based on its latest FOMC decision, delaying the hike in its rock-bottom policy interest rates towards the end of this year. On the domestic front, there are unfortunately "dark clouds" hovering over Malaysia's economic landscape, together with unhealthy haze blowing from neighbouring country, Indonesia. These so-called "dark clouds" include increasing net outflows of portfolio investment, downward overshooting of the ringgit exchange rates, rising cost of living, elevated Federal Government and household debts, rising probability of default and increasing likelihood of downgrading of ratings for Malaysian Government debt. Most worryingly, domestic macroeconomic fundamentals are showing signs of weakening, as seen in moderating aggregate domestic demand, in particular gross fixed capital formation (most notably private investment), continued contraction in net exports of goods and services, plummeting net foreign reserves of BNM, increasing outflows of portfolio investment by foreign investors, elevating foreign currency exposures of GLCs and corporations, rising number of non-performing loans, more job cuts and retrenchments, and financial sector weaknesses, among others. As such, near-term outlook looks gloomy, especially with crude oil and other commodity prices are expected to be "low for long", following especially weaker demand from China and steady increase in supply, most notably for crude oil. Oil price decline is now not a transitory phenomenon anymore, becoming almost permanent, declining consistently for more than a year and by over 50%. Familiar economic jargons seen in literature like structural change, breakpoints and regime switching are becoming realities.

Related to these developments, there is clearly a need for "new policy framework", focussing on short-term stabilization measures by putting greater efforts at renewing Government's commitment, restoring market sentiment and confidence, enhancing policy credibility and protecting Malaysia's good reputation both at home and overseas. Most importantly, there is a need to arrest sovereign bond rating transition from investment grade to speculative or "junk bonds" status, as exaggerated by credit default swap (CDS) investors in August 2015. Well-established international rating agencies seemed to be lagging behind, becoming loosely disciplined and taking extra time in incorporating latest financial market information and expectations. We need to be mindful that foreign investors are not just looking at current macroeconomic conditions or existing macroeconomic fundamentals, which are generally okay, but financial market conditions and more importantly, future direction of the economy together with domestic political factors. These involve to a large extent "forward looking" and long-term expectations, scenario planning, stress testing and other exotic risk management toolkits. Algorithmic modelling and big data analysis are being used to identify key predictors on default probability, encompassing economic variables, social indicators, political thermometers, trends as well as wavelets in the social media, among others. These are broken into several category of risk factors, namely insolvency, illiquidity, macroeconomic, political as well as systemic risk factors. The latter include financial market contagion, regional as well as global.

While specific measures have already been announced by the Government, based on the recommendations by the Special Economic Committee (SEC) on 14 September 2015, and more are expected in the Budget 2016 tomorrow, greater efforts need to be geared because warning signals and red flags are there, pointing to the fact that unfavourable economic conditions are on the way. Conditions will certainly get worse, if appropriate stabilization measures or policy actions are not being implemented in the near-term. Meanwhile, we need to continue examining in-depth all binding constraints to economic and social development, existing distortions and imperfections in market microstructures, the breakpoint and structural change, correlations among macroeconomic variables, fat tail risks and copulas, among others. Political spats and racial rhetoric unfortunately add to the worsening conditions, as stabilization measures and policy actions require strong ownership and support by all stakeholders, irrespective of political affiliations, racial and religious associations. There are certainly social costs and in fact welfare losses to the society, associated with delays in economic adjustments, lack of openness and transparency, gap in policy credibility, weak institutions, poor governance and, worst still low ethical and moral standards. In this respect, there must be strong guiding hand, good signalling mechanism and certainly credible policies for market participants to react adequately, while extensive consultations with relevant stakeholders will ultimately help to avoid uncertainty and negative perceptions of stakeholders, consumers, investors and rakyat alike. More importantly, we need to ensure continued happiness and good life for the rakyat by encouraging greater kindness and showing strong compassion to others, especially in this difficult times.

Short-term Issues and Stabilization Measures

Real GDP registered a moderate growth of 4.9% in the second quarter of 2015 (1Q2015: 5.6%), performing better-than-expected in an environment of fragile global recovery and renewed uncertainty, associated with enhanced financial market volatility and continued decline in commodity prices. Consequently, economic growth moderated in the first half of 2015, registering about one percentage point lower at 5.3%, as against 6.4% registered in the corresponding period last year. Meanwhile, net current account of the balance of payments (NCAB) also moderated, but still remained in surplus, registering about RM17.6 billion in the first half of 2015 (2H2014: RM12.8 billion, 1H2014: RM34.5 billion), declining by almost 50% compared to the amount in the corresponding period last year. With anticipated slowdown in China's growth and continued decline in prices of commodity exports, especially crude oil and also palm oil, expectations about the likelihood of "twin-deficit" problem have again resurfaced in recent months, pointing to weakening domestic macroeconomic fundamentals.

While overall unemployment edged upward slightly to 3.2% of the total labour force in July this year, indicating full employment situation (threshold at 4%), consumer price inflation moderated slightly in August 2015, registering 3.1% year-on-year compared to 3.3% in the previous month (June: 2.5%, May 2015: 2.1%, April 2015: 1.8% and March 2015: 0.7%), on account of mostly policy-driven domestic cost-push factors. These included the cumulative direct and indirect effects of GST implementation, adjustments in fuel end-user prices in August 2015 and also partly by higher import prices, following almost across-the-board declines in bilateral ringgit exchange rates, especially against Malaysia's major trading partners. Fortunately, pricing behaviour of firms and strong market competition, especially in the distribution and marketing channels, helped to minimize sharp increases in domestic consumer prices. Moreover, traders or retailers are not allowed to increase their net profit margin for any goods or services for 18 months from January 2015 to June 2016, as required under the Price Control and Anti-Profiteering Act 2011.

Moving forward, Malaysia continues to be susceptible to both unanticipated and anticipated external shocks. These include sharp reversal in portfolio investment flows, declining prices of commodities and heightening volatility in financial assets prices. Terms-of-trade (TOT) of the country has been trending down in the last four quarters, exacerbated by declining commodity prices and, most worryingly continued depreciation in ringgit exchange rates, which seemed to be unabated. Import price index has been showing an uptrend in the last five years, pointing to the fact that ringgit depreciation is not just a recent phenomenon. In fact, bilateral ringgit exchange rate with the USD has been depreciating all the way in the last five years with rising volatility and finally breaking to sharply lower value since September 2014 until recently. Sadly for Malaysia, the ringgit has been allowed to cross the psychological threshold of RM3.80 per USD on 6 July 2015, and touched its lowest external value in the last 17 years at RM4.4725 per USD on 29 September 2015. Meanwhile, domestic interest rates are expected to increase, especially with a widely anticipated hike in interest rates in the United States (US) later this year. Looking at the medium-term macroeconomic perspective, downside risks have generally increased, while growth prospects have weakened, especially in commodity-dependent emerging market economies. Activity in advanced economies is expected to pick up only modestly this year, according to the latest statement by the IMF. Nevertheless, strong recovery in the US economy will hopefully help to sustain export earnings of goods and services as well as foreign exchange earnings from tourism activities and receipts from educational services, as Malaysia becoming centre of educational excellence in the region.

Macroeconomic and Financial Policies

Bank Negara Malaysia (BNM) decided to maintain the Overnight Policy Rate (OPR) at 3.25% in its latest Monetary Policy Committee (MPC) statement, released on 11 September 2015. This was actually the seventh time the OPR remain unchanged since BNM raised the OPR more than a year ago on 10 July 2014. The MPC decision was also on the same path with the US Federal Reserve Bank (Fed) recent decision to delay the increase in the Fed Funds Rate (FFR) from its almost zero percent since December 2008. The Fed decision on 19 September 2015 was reportedly data-driven, although external parameters also entered into their monetary policy reaction function, especially growth slowdown in China, Yuan devaluation and China's financial market turmoil. Meanwhile, the Fed Funds Rate is expected to be raised later this year and most likely to be delayed to early 2016, as requested earlier by both the IMF as well as World Bank.

While domestic interest rates remained low, growth in monetary aggregates have weakened considerably, especially in recent months. This emerging situation could potentially push interest rates to higher levels, especially with contagion effects, expected to come from a widely anticipated hike in the US interest rates later this year. BNM has been active in conducting foreign exchange interventions (FXI) to influence the level of exchange rate, which came under strong exchange market pressures, especially during August and September 2015. The unsterilized interventions have resulted in a marked reduction in broad money supply, as the external value of ringgit continues to take a severe beating. This indicates that FXIs in recent months were not effective and intervention is certainly not a valid toolkit in the present environment. "Leaning against the wind", especially in abnormal and difficult times resulted in net foreign reserves losses, almost like fighting a losing battle. While the tightening of liquidity condition was not reflected in the upside movements of key interest rates, following stable interest rate environment both at home as well as abroad, ringgit exchange rate continued to take the brunt of adjustment, depreciating markedly against the currencies of most of Malaysia's major trading partners.

Net international reserves continued its downward trend, registering USD93.3 billion as at 30 September 2015, well below the "psychological threshold" of USD100 billion (end-December 2014: USD116.0 billion; end-Dec 2013: USD134.9 billion). Fortunately, the ratio of international reserves to short-term external debt stood at 1.2 times, marginally above the standard international threshold of 1.0, as short-term debt also changes with financial market developments. However, Malaysia international investment position (IIP) continued to record deficit, totalling RM13.1 billion as at end of 2014 (end-2013: -RM47.2 billion, end-2012: -RM17.8 billion), indicating that Malaysia is a net debtor on international front, running for three years in a row. This unfavourable stock position is expected to continue this year, despite significant surplus of RM33.9 billion registered as at end-June 2015, helped by a smaller deficit in equity and investment fund shares under portfolio investment as well as increasing surplus or net inflows in debt instruments within direct investment in Malaysia. While both direct and portfolio investment positions have improved in the second quarter of 2015, "other investments" continued to record substantial net outflows (deficit). Net outflows of portfolio investment for equity and debt instruments are estimated to persist in the third quarter of 2015 and also in the coming quarters. Consequently, we could well see that Malaysia again register a net debtor position under IIP for the year as whole in 2015. Moreover, debt securities markets continued to be under strong selling pressures in recent months, as foreign investors are ditching Malaysian debt securities and reallocating their fixed-income portfolio back towards dollar-denominated assets on expectations of hikes in interest rates in the US later this year and strengthening of the US economy.

Global Economic Developments and Prospects

The global economy is currently being shaped by two widely anticipated, but opposing events, which are creating a lot of economic uncertainty and sharp volatility in the global financial markets. Firstly is the expected growth slowdown in China, the world's second largest economy and also global manufacturing powerhouse. Then, there is also an increasing indebtedness in a large number of developed as well as emerging market and developing economies, of which Malaysia is included. Secondly is the strengthening of the US economy, boosted by strong consumer spending and also recovery in the housing market. As a result, monetary policy normalization is widely expected in the US later this year, described by many analysts as an important event the history of monetary economics. The projected higher interest rates in the US and stronger US dollar could see that borrowing and debt servicing costs for many highly-indebted nations will be on the rise, exerting significant pressure on both Government finances and corporate balance sheets. Terms of trade losses and currency declines have also resulted in narrowing of fiscal space for many commodity exporters, and here again Malaysia included. Window of opportunity for strategic reform initiatives and structural adjustments is certainly getting less and less, according to the President of the World Bank in Lima recently.

The International Monetary Fund (IMF) in its latest World Economic Outlook (WEO, October 2015), released on 6 October 2015, revised downward the 2015 annual growth estimate for the world economy to 3.1% (2014: 3.4%), representing 0.2 percentage points lower than July 2015 WEO Update estimate of 3.3%. The IMF also revised downward the global growth forecast for 2016 to 3.6%, down by 0.2 percentage points, pointing to only modest recovery for the global economy next year. Nonetheless, growth in advanced economies is expected to be on the uptrend this year, growing slightly higher by 2.0% (2014: 1.8%, 2013: 1.4%), but slightly lower when compared to July 2015 WEO Update forecast of 2.1%. Meanwhile, growth rate in 2016 is projected to be 2.2%, reflecting a downward revision of 0.2 percentage points. Growth in emerging market and developing economies as a group is projected to moderate slightly to 4.0% this year (2014: 4.6%, 2013: 5%), which is 0.2 percentage points less than earlier forecast at 4.2%. While growth is expected to be on the uptrend, registering 4.5% in 2016, it was a downward revision by 0.2 percentage points, indicating modest pace of expansion, especially in crisis-affected countries.

Growth in the US economy is gaining momentum, registering 3.9% year-on-year in the second quarter of 2015, well above 0.6% recorded in the first quarter of 2015. Inflation rate in the US remained below the Fed's 2.0% target, creeping up by only 0.2% year-on-year in August 2015, the same rate as in the previous month, supported to a large extent by continuing low energy prices as well low import prices, as the greenback has been strengthening since early this year. Interestingly, US unemployment rate is moving close to 5% rate, registering 5.1% in September 2015 (August 2015: 5.1%), indicating that labour market conditions are generally improving, but job creation is seen as moderating in recent months. While the twin goals of monetary policy, namely keeping inflation under control and promoting "maximum employment" remain on track, the Fed is clearly shifting its goal post, focussing more on the impact of strengthening US dollar, especially with Yuan devaluation and the projected growth slowdown in China and other emerging market economies.

The pace of expansion in the euro area is weakening and risks to recovery seem to be on the rise. Fears of deflation became a reality, as the euro area inflation rate slipped below zero at minus 0.1% in September 2015, the first negative rate in six months, attributed largely to lower energy prices. The IMF in its October 2015 WEO maintained the growth forecast for the euro area at 1.5% in 2015 (2014: 0.9%), while forecast for 2016 has been revised downward slightly by 0.1 percentage point to 1.6%. The euro area is still struggling with high unemployment and high Government debt and deflationary situation remains a threat, especially with lower energy prices. Abenomics is certainly not performing well in Japan, especially its third arrow, namely structural reforms. There is a high probability that Japan enters into a technical recession in the third quarter of this year, especially after real GDP growth contracted by 0.3% quarter-on-quarter in the second quarter of 2015. Growth has been constrained to a large extent by continuing high public debt, which stood at about 250% of GDP and aging population. Meanwhile, China is transiting gradually to a new growth model, growing more sustainably at 6.8% growth predicted this year (2014: 7.3%, 2013: 7.7%) and 6.3% in 2016, which are the same growth forecasts as in April 2015 WEO as well as in WEO Update in July 2015. These growth forecasts seemed to be in tandem with an ongoing structural reform programs, moving steadily to a more market-based economic and financial system. There are efforts by the authorities at re-aligning the sources of growth of the economy, from essentially export-led and investment-driven to consumption-based and services-oriented economy. These are good evolution and legitimate, according Ms. Lagarde of the IMF. China's growth slowdown this year, the lowest in 25 years, is certainly driving downward growth in other emerging market and developing economies, especially exporters of raw materials, such as oil, metals, minerals and other commodities. Brazil, Russia, Malaysia and even developed economies like Australia and Canada are also affected, although with a varying degree.

Growth in India remains strong, representing a truly bright spot in Developing Asia, which certainly put India in the same league as the US and UK for advanced economies. India is benefitting a lot from a persistently low energy prices, supported by its continued structural adjustment and reform programs. Nonetheless, the IMF revised downward India's growth forecast for 2015 to 7.3%, which is the same growth rate achieved last year (2014: 7.3%, 2013: 6.9%), while maintaining India's growth forecast for 2016 at 7.5%. As such, India is overtaking China's growth rate this year as well as in 2016. Meanwhile, in Latin America and the Caribbean, Brazil another BRIC country, is in deep recession (2015: -3.0%, 2016: -1.0%), sharing similar economic difficulties with Russia (2015: -3.8%, 2016: -0.6%), due largely to lower commodity-export prices. Countries in the Middle East and parts of Africa are certainly in deep political turmoil, especially in Syria, Iraq and Yemen. Airstrikes by Russia in Syria could escalate the current conflict, driving more refugees into Europe and possibly forcing NATO to protect its member country, Turkey.

Downside Risks

The balance of risks is still tilted to the downside, according to the IMF in its latest October 2015 WEO. There are warming signals and red flags that the world economic outlook is worsening, especially in recent months. These include across-the-board declines in oil and other commodity prices, sharp appreciation of the US dollar, sudden reversal of capital flows out of emerging market and developing economies and greater volatility in global financial market. Crude oil prices are expected to remain low this year as well as in 2016, averaging about USD51.62 per barrel in 2015 and USD50.36 per barrel in 2016, according to the latest projections by the IMF. Meanwhile, there is an increasing volatility in the global financial markets, which started again in mid-August 2015, resulting in downward overshooting for currencies of commodity exporters, such as Brazil, Russia, Australia, Canada and Malaysia as well. Global risk aversion is reported to be on the rise, especially with worsening near-term global economic outlook. This situation is being reflected in increasing dollar bond spreads, declining equity prices and sharp movements in exchange rates. Declining oil and other commodity prices, wider acceptance of flexible exchange rate regime, together with existing market distortions and imperfections have resulted in downward overshooting of exchange rates, as portfolio investors were reallocating their short-term investment to dollar-denominated assets, especially in the US, UK and recently in Japan. Geopolitical factors have also added to worsening economic conditions, especially with continued fighting in the Middle East, recent airstrikes by Russia in Syria and continued fighting in Yemen.

Medium-term risks include near stagnation in advanced economies and consequently below-target inflation rates, as seen in the US, euro area and Japan in recent months. Low potential output growth, slower-than-expected growth or possibly "hard landing" in China will affect economic performance of resource-based economies and commodity exporters, including high-income nations and, most worryingly low-income developing economies in Africa as well as Developing Asia. Looking from longer-term perspective, low fixed capital formation and aging population are expected to lower potential output growth in advanced economies, such as Japan.

Long-Term Issues and Policy Directions

Looking ahead, Malaysia needs to adjust quickly to the so-called new normal in the world economy, associated with continuing growth realignment in China, the world's second largest economy and monetary policy normalization from zero lower bound (ZLB) in the US. Window of opportunity is getting less over time, as the world economy is clearly moving out of post-crisis easy monetary conditions, starting in early 2016 and moving towards a more sustainable development in the years ahead. Medium and long-term structural adjustment and reform programs must continue to be the key priority of economic policy, supported by appropriate short-term stabilization measures and macro-prudential arrangements. Accommodative monetary policy is certainly not an option in the coming months, less so with massive fiscal stimulus package, as fiscal space is being constrained by lower oil revenue and rakyat is being squeezed hard by consumption-based Goods and Services Tax (GST). Tax incentives and financial support for private investment, which is currently on a moderating path, are urgently needed to boost business confidence and enhance potential output growth in the long-term. While downward adjustment in public consumption is certainly required as part of an ongoing fiscal consolidation process, public investment in key infrastructure projects and human capital development are necessary in order to remove infrastructure bottlenecks in the economy, such as traffic congestion and frequent supply cuts in basic utilities, but also to ensure ready pool of healthy and skilled workers in the economy.

On the supply side of the economy, new long-term measures need to be undertaken to further enhance total factor productivity (TFP) and improve overall nation's competitiveness. These include removing structural impediments and binding constraints to sustainable growth, reducing further market imperfections and distortions that inhibit the growth process, especially in the product, services and labour markets. While we certainly need to lower barriers to entry in the labour market by encouraging greater female labour force participation rate and by the elderly, greater efforts need to undertaken to lower the cost of doing business and facilitate entry of new entrepreneurs and young talents in product and services markets. Greater focus needs to be given on adoption of new technologies, research and development (R&D), innovation and greater power of new ideas, through upgrading of skills and reducing out-migration of talents.

Posted by suzy at 12:06 PM