Malaysia is having internal and external risk (内忧外患）

The Malaysia election is finally over, with the ruling party again winning the election with simple majority. While it is over, the dust has yet to settle down. There are still uncertain factors here and there, such as

1) The losing side's emotion, will there be demonstration, protest going on, and how will it settle down? When will it settle down?
2) The change of structure inside UMNO（the ruling coalition). How will it affect the policy and the stability of nation

Political unstability period is a transition period that we have to wait and see. But the economy issue can be rather pressing. With the debt/GDP reach 55%, shadow unofficial number of debt/GDP may be even more. Public debt and consumer debt is reaching a very high level. Continuing budget deficit of Government may soon put a cap on the development. High consumer debt may also put a cap on consumer spending too. With government spending and consumer spending reaching the cap, we have to rely on foreign investment to boast GDP. We definitely can also increase the income of consumer, but it can be very difficult in current situation of middle income trap.

Foreign investment brought in money and boast the ringgit to very high level in short time. They can create jobs for Malaysian. But now I see the problem is more and more money is pouring in to buy property, land rather than create jobs. (May be we can argue that jobs will be created along the way, we have to wait and see, we have to see also wether the jobs created is a low pay job or high pay job) Strong ringgit is good for Malaysia consumer spending, but is it true? There is no sign the inflation is slowing down, may be only good for Tony Fernandes. Strong ringgit will make Malaysia less competitive because of higher living cost and business doing cost. Unless Malaysian can increase productivity or work in highly paid service job,that may put a cap of foreign investment. Strong ringgit is also bad for export, it will push out export manufacturing to lower cost countries or out of business completely in worst case scenario. Export manufacturing is one of the main income to Malaysia. Malaysia require company to switch to automation and reduce worker. This has to be done gradually.

Lower commodity price is another blow to Malaysia income group. Malaysia depend largely on resources. Low commodity price means lower consumer spending and government spending. With the global economy slow down and there is no sign of picking up in this year or next (Europe is worse off, China is slowing further), commodity price may not able to pick up soon. There is also risk of over expanding of oil palm in Indonesia and Africa.

Uncertainty of political landscape; high government and consumer debt; high budget deficit; rapid rising of RM; huge inflow of foreign money; low commodity price; gloomy global economy; There are many risk in Malaysia economy. Government need to do something to mitigate. I think government should now focus more on 养精蓄锐 (conserve wealth and build nation structurally to become more transparent and effective) rather than desperately expand aggressively to reach the 2020 high income vision.