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Tuesday, December 11, 2007

Discard subsidy mentality, Najib tells builders

Deputy Prime Minister Datuk Seri Najib Razak yesterday called on the construction industry to discard the subsidy mentality and strive for the highest level of quality in their work.

"Subsidies distort the economy, lull our business into complacency rendering them globally incompetitive, and do not even benefit the intended target groups," Najib said in his speech at the launching ceremony of the Construction Industry Master Plan (CIMP) Malaysia 2006-2015 in Kuala Lumpur yesterday.

The masterplan which outlines eight critical success factors and seven strategic thrusts identified by the industry stakeholders was developed over the last four years.

Najib said while all industries will be affected by any move to reduce or eliminate subsidies, especially the subsidy for petroleum, they also stand to benefit from such a move.

"Any saving in subsidies will mean more funds for development," he said.

It has been reported that an average of RM23 billion is spent on fuel subsidy and the subsequent loss of sales tax the last three years.

"If this amount is added to the annual RM44 billion development expenditure under the Ninth Malaysia Plan, and a further RM18 billion generated annually by the various regional growth corridors, then the annual development expenditure has the potential to reach RM85 billion, almost double the present development budget," he said.

He said the construction industry must offset any increase in cost of construction by increasing their productivity.

"This is the challenge that must be dealt head-on by the CIMP. As it is, the CIMP has already set this as the first of its seven strategic thrusts," he added.

Najib also said that the CIMP should help the construction industry excel in the world of cut-throat competition.

As of 2006, Malaysian contractors have secured 373 projects valued at about RM56 billion in 37 countries. "This is no small achievement. Malaysia is now a global construction player respected by many and demanded by all," he said.

But he added that it was also evident that higher standards were expected of the industry.

"The construction industry lately seems to be attracting attention for all the wrong reasons, notwithstanding its numerous contributions to the process of nation building," Najib added.

He said the reason is that consumers have a much higher expectation of the industry.

"But I am confident that the CIMP would help redeem the image of the construction industry and put it back on track," he added.

He also said the recently launched growth corridors nationwide would benefit the construction industry.

Najib also said it was important for the construction industry to contribute to the development of human capital.

By New Straits Times (by Jennifer Gomez)

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