Fuel dilemma and wealth creation

Great debate tonight between DS Anwar Ibrahim and Shabery Cheek. Although to me, it looks more like an experienced debater who knows macro economy against a layman, who resorts to firing cheap shots when he couldn't hack it. Well at least Shabery has the guts to face DSAI on live television. If it were Pak Lah, its guaranteed to be one hell of a disaster of Umno. Will be eaten alive and spit out by DSAI like nobody's business.

So now we have heard DSAI's approach to reduce petrol price if PR succeed in taking over the government. What I wonder, and was mentioned by Shabery, is how long can the subsidy last? As long as Malaysia is a net exporter, we should be profiting from the oil price increase, but sooner or later, the well will dry up. Maybe not in my lifetime, but during our children's generation. Should that day come, are we going to see a sharp increase in oil prices when government can no longer subsidize our fuel?

The point I'm getting at is, the government in power should focus on wealth creation. Increasing FDI will create wealth. Exporting more than importing will create wealth. Basically, we need surplus of foreign cashflow coming into the country. That is how we can expand the cake for every Malaysians to share. At the moment, the government is only distributing the cake, but no one is putting new cakes into the oven.

But how do we create wealth? The same way how Koreans, Americans, Britain, Japanese, French or any developed nation did it. Invest in R&D and create new products that we can EXPORT. Innovate on the current ones and EXPORT them as well. That is one way how wealth is created. From passenger cars to handphones to LCD tvs, the Koreans have them all. And exporting creates wealth for their country.

Same goes for Singapore. With no natural resources, they focus on other areas for wealth creation: Services sector such as banking, high finance and insurance sector. With clients from all over the world, wealth is certainly pouring into Singapore.

When Malaysia has mastered the art of wealth creation, our Ringgit would surely appreciate, and so will our buying power. That time, maybe we will not be too burdened by the fuel prices since most of us would be able to afford it, even without subsidy. Only then, can we truly be called a developed nation.