PETALING JAYA (THE STAR/ASIA NEWS NETWORK) - The impact of the reduction in global oil prices from US$100 to US$40 per barrel can be offset by a rise in demand for Malaysian-manufactured goods, said Prime Minister Najib Tun Razak on Tuesday.
Datuk Seri Najib, who announced revisions to the 2015 Budget that was tabled in October last year, said that this could be done as crude oil only makes up 4.5 per cent of the nation's total exports.
"The reduction in the price of crude oil will indirectly increase demand in Malaysia-made products. We will actively promote 'import-substitution' to reduce our dependency on external sources to obtain goods and services," said Mr Najib.
He added that the government initiatives would be created to increase the use of the private sector.
"We will give priority to local Class G1 (Class F), G2 (Class E) and G3 (Class D) contractors registered with the Construction Industry Development Board to carry out recovery works in their local areas affected by the east coast flood," said Mr Najib.
He added that the Government would intensify promotions encouraging the public to buy made-in-Malaysia products.
"We will increase the frequency and duration of mega sales throughout the nation, and intensify domestic tourism promotions by offering competitive airfares," said Mr Najib.
He also said that the Government would encourage the private sector to reap opportunities created by the Asean Economic Community.
"We will also intensify programmes to boost exports of Malaysian goods in 46 nations across Asia, Europe, the Middle East and America," said Mr Najib.
In his speech, Mr Najib said the adjustment to the 2015 Budget was necessary to "ensure our economy continues to attain respectable and reasonable growth, and development for the nation and rakyat continues" as the 2015 Budget was based on the price of crude oil remaining at US$100 per barrel.
"Based on a crude oil price of US$100 per barrel and taking government saving measures and retail price controls into account, the Government was expected to have a fiscal profit of RM3.7 billion (S$1.4 billion). However, with the current price of oil at US$55 a barrel, the government will lose RM13.8 billion in income," said Mr Najib.