April 2008 Economic Data & Analysis

Malaysia

1. Malaysia will count on domestic demand and high commodities prices to sustain growth as US Slowdown damps global trade.

2. The cost of the Government’s food security strategy to counter the worldwide increase in prices, especially rice, will total RM4bil. The money will be used to increase food production and counter inflation to keep prices in check. The allocation would also be used for food stockpiling.

3. Consumer Price Index (CPI) for January to March 2008 increased by 2.6%. Food and non-alcoholic beverages (4.4%), housing, water, electricity, gas and other fuels (1.3%) and transport (0.9%).

4. Domestic financial markets continued to experience some volatility amidst uncertainties on the outlook for global growth and continuing disruptions in the international financial markets.

5. Pahang is a geared towards becoming the East Coast Economic Region (ECER) dairy hub when an RM50mil farm in Rompin managed by First Dairy Farm (M) Sdn Bhd. comes into operation in May 2008.

Current Global Economy Situation

The U.S.

1. Fed lowered its interest rates for the seventh time (in eight months) by a quarter of a percentage point to 2.0%. The Fed mentioned that the risk of recession is gradually reducing, thus signalling an end to one of US’s most aggressive rate cuts in diverting its attention to curb inflation.

2. Consumer confidence fell as negative news continued to plague the employment and housing sector this week. Weekly initial jobless claims rose to its 4-week high at 380,000 and job cuts by employers in Apr-08 rose to the highest since Sept-06 by 27.5% and unemployment rate at 5.0%.

3. First quarter US GDP was up 0.6%, driven by a 1% increase in personal consumption expenditures. Contrary to popular belief, the consumer continues to spend in the face of rising gas prices, falling home prices and declines in payrolls.

China

1. Consumer confidence index dropped 1.7%. Consumer inflation has been on the rise since last year, largely due to soaring food prices.

2. The world's fourth-largest economy's growth slowed slightly to 10.6 percent in the first quarter, compared with 11.7 percent in the same period last year, according to National Bureau of Statistics. The deceleration might continue because of uncertainties such as reduced external demand and the spreading impact of the US subprime mortgage crisis.