THE Association of Banks in Malaysia (ABM) thinks Budget 2006 has been well formulated to provide a strong foundation for the next phase of economic development while generating quality growth in the near term.
In a statement, chairman Dr Rozali Mohamed Ali said that recognising the many downside risks and imbalances on the global front arising mainly from the spike in international oil prices, the budget had appropriately focused on measures to strengthen domestic resilience, develop the soft infrastructure including human capital capability as well as management and organisational systems, and provide a business friendly environment.
In light of the challenging external environment, the Government's move to bring the budget deficit down to 3.5% of GDP (gross domestic product) in 2005 from 3.8% in 2004 will allow it to have a greater degree of flexibility to focus on developmental efforts in order to sustain the growth momentum.
The substantial allocation provided to accelerate rural development reflects the Government's commitment to achieve balanced growth in the economy, it said.
ABM welcomed the Government's move to fine-tune various measures and incentives to help accelerate domestic sources of growth and prepare the domestic environment for the next stage of growth.
The association believes the strategies and measures laid out in the budget would pave the way for the private sector to assume a more aggressive role in driving the economy to achieve quality growth in the years ahead.