Economy Kaput Ready.

Bloomberg on Jan 5 reported that Malaysia, among the world’s three biggest producers of both palm oil and rubber, will see exports and economic growth decelerate this year because of the “drastic plunge in commodities prices”.

It further added that “The support from commodity prices has dissipated and the drag from the depressed global demand is beginning to show,” DBS said in a report from Singapore. “Given the dire global economic conditions, consumers and businesses have cut back on their expenditure and that will surely weigh on the growth outlook for Malaysia’s export-oriented sectors and on a broader basis, the whole economy.”

Malaysia’s manufacturing sector will contract by 1.9 percent in 2009, from estimated growth of 3.4 percent last year, DBS said. Gross domestic product will “soften” to 3.3 percent, from 5.5 percent, the report said

Now, let us look into what really happening in Malaysia at present :

No of Container in and out at Ports in Malaysia :

I heard Feeder Vessel service from Penang Port to Malaysia’s main port, Port Klang had been reduced by half.

Also heard from forwarders and hauliers that number of Export and Import Declarations Form had reduced tremendously. Hauliers whom used to ferry about 30-40 container perday now only able to get maximum 15 containers per day.

While , a short call to Singapore Shipping agent indicates that Vessel’s berth much longer there as they found it difficult to fill up spaces available. The situation may soon be seen in Malaysia.

Labour Supply

This morning went to meet up another friend whom managing manpower outsource agency for a mutinational in Shah Alam, Malaysia.  According to him the company had reduced production hours from dual working shift to single shift. While, the warehouse fully loaded with finished goods a rare phenomena for extensively managed factories.

During a meeting recently Multinational Company’s MD says that we need to hold to similar situation for minimum of next 6 months because gauge next step of direction. It could be close shop entirely.

Let’s Look at Small and Medium Industries

This sector always been ignored by Government when making policies. As they only cater small group of people but their economic value equivalent to Large Sectors.

Visited another friend running an Engineering Workshop  for last 20 years. Shocked to see him and 6 others Technicians cleaning their workshop. He says first time in my 20 years experience we don’t have any order. All the while good or bad we have at least one pending  work.  My customers big multinational got instruction from parent company no more issuance of Purchase Order. I’m worried how to cover overhead at end of month.

After hearing his views I then called another friend in Printing Industry . He asked where are you . After giving the location, he asked myself to wait at a Mama Stall ( Indian Muslim Restaurant).  While chatting with myself the restaurant owner asked about my business. Explained to him the struggle I’m through.  Brother, here worst too , my business down by 50% . Now everywhere people starting food stalls to survive from economic downturn.  Instead of drinking Mil0 ( a Chocolate Drink) they asking Tea O . Just behind my shop a new restaurant opened last week selling Roti Canai at RM0.50 sen per piece. How to survive brother?

About 15 minutes later my printer friend arrived .  His attire shows he came straight from Temple as today is Vaikunda Ekadasi ( opening of Heaven’s Gateway). Asked him what message you got it from temple.  He explained that the priest advised him a month ago that movement of planets not very much favourable . Business will surely suffered up to June/July 2009 while change of leadership may happen but to weaker hand. Lord Rama Loss his Kingdom and Lived in Jungle when planets movements was similar as current time. The only solution is pray harder and seek Almighty Blessing.  Humm.. Interesting to hear .

Sam, I need a favour from you. Need RM 20K very urgent by this afternoon.  I’m stuck with RM500,000 stock in warehouse. Another shipment already out but no payment yet. Offered 40% discount to my loyal customers asking them to take the stock but none of them shown any interest yet. Need to pay my staff salaries as it’s their hard earned money. Last evening couple of them begged at me for salary as no food to cook at home. Please help me Sam.

This month Ok, next month how ask Sam. I have no choice but to transfer some of my foreign workers out . Some , willing to take two month off.

But, I cann’t give so much  RM10k manageable.  Ok for you.  No Choice I will manage temporarily.

You know , yesterday my biggest client called me. He start shouting over the phone that my prices 100% expensive the others. No choice, immediately I cancelled another appointment rush to his factory.  He took out a quotation from a new supplier to proof his claim.  My blood pressure shoot straight to my brain nervous. Oh! my god, I’m death .

Those big giant printers whom serving electronic industries and never bother about small clients now walking into our path ready. They also offering credit terms and immediate delivery. Any volume doesn’t matter. It’s only way for the big guys with multi million ringgit investment need business to survive and roll on their cash. I lost one of this customer new contract, cann’t compete. Their price lower then my paper cost. Luckily I have my own magazine to survive time being. Maybe in one or two month I might scrap out my machines and just concentrate into marketing of magazine.

This is what really happening in Malaysia today eventhough our political Leaders  claiming that our economy still doing well referring to with outdated statistics.