KUALA LUMPUR: Malaysia is still on track to achieve its targeted gross domestic product (GDP) growth of between 4.5 and 5.0 per cent this year, despite a drop in monthly output in August.
"Export is quite modest and on track," said International Trade and Industry Minister Datuk Seri Mustapa Mohamed on the sidelines of the Global Entrepreneurship Summit 2013 (GES 2013), here, yesterday.
He was replying to a question on whether the GDP growth target is achievable due to lower industrial production index (IPI) in August.
The August IPI fell by 4.6 per cent month-on-month due to a drop in all indices. The manufacturing index fell by 5.4 per cent while the mining and electricity indices declined by 3.6 per cent and 2.5 per cent, respectively.
However, output grew by 2.3 per cent compared with August 2012.
Bank Negara Malaysia had cut its growth forecast for this year after a slower-than-expected expansion in the second quarter. It had revised its forecast to between 4.5 and 5.0 per cent from six per cent previously.
When asked about reducing government cost, Mustapa said it can be achieved through efficiency and higher productivity.
He also said the government does not need to scale down the size of the civil service to cut cost because the majority are involved in four sectors critical to the nation's well-being, which are education, health, army and police.
Meanwhile, Mustapa said the government has come out with several initiatives as an exit strategy for those dependent on government assistance.
He said grants previously given to local entrepreneurs have been discontinued and replaced with soft loans and regular loans. The government also offers advisory services to facilitate entrepreneurships.
Mustapa said the government provides access to financing for micro entrepreneurs to grow and expand their businesses.
"It is called Amanah Ikhtiar Malaysia, a concept similar to the Grameen Bank, and about 90 per cent of the entrepreneurs are women," he said.
Mustapa added that there are many success stories in Malaysia where former employees of large organisations, especially multi-national corporations, had quit their jobs and set up businesses.
Also on the GES panel yesterday were United States Commerce Secretary Penny Pritzker, Singapore Trade and Industry Minister Lim Hng Kiang, Vietnamese Deputy Prime Minister Hoang Trung Hai and Cambodian Deputy Prime Minister Keat Chhon.
Pritzker said a good entrepreneurship ecosystem is one that provides a second chance for entrepreneurs to triumph over their failures.
According to her, the culture of encouraging risk-taking by not penalising people who fail in their businesses is the main recipe of success for many entrepreneurs in the US.