PETALING JAYA: Economic recovery, both globally and locally, is expected to be sluggish till 2012, says Malaysian Institute of Economic Research executive director Prof Datuk Dr Mohamed Ariff Abdul Kareem.
He said the road would be bumpy and rocky as countries around the world might not experience sustainable recovery.
“All indicators show that the world would face sluggish growth for the next three years, we would experience pre-crisis trajectory growth only by 2012,” he said at the CEO Breakfast Forum on Effective Marketing on the Road to Economic Recovery yesterday.
Countries, such as China, which had shown dynamic growth despite the global slowdown, were actually supported by massive stimulus packages, he said, adding: “Many of these countries have actually become very addicted to stimulus packages, hence recovery is unlikely to be sustainable.”
He said these countries would require further injection of fiscal stimulus in order to keep the growth momentum going but many were running out of resources.
As a result, the US could suffer a relapse in economic growth as early as the first quarter of next year and might face a W-shaped recovery, he said.
“Growth of other countries, including Malaysia, could be affected as well due to this as the US is one of the biggest economies.”
Meanwhile, Mydin Mohamed Holdings Bhd managing director Datuk Ameer Ali Mydin said the slowdown had presented the company, which owns the Mydin chain of supermarkets, with many opportunities for growth in sales as well as expansion.
“During an economic downturn, people will tend to shop at lower-cost retail outlets,” he said.
The group recently went on an expansion drive and plans to open its new hypermarket in Kubang Kerian, Kelantan, early next year as the costs of setting up its outlet, such as architecture fees and renovation costs, were lower due to the slowdown.
AirAsia X Sdn Bhd chief executive officer Azran Osman-Rani concurred that consumer demand still existed despite the slowdown.
“We got through the current environment by creating a product that really stood out and attractive and we communicated its value to our customers clearly and through very simple means,” he said, adding that AirAsia X had allocated 5% of its recent revenue generated for advertising and marketing.
He also stressed the importance of continuous innovation to stay ahead of the competition.
Meanwhile, Alliance Bank Malaysia Bhd group chief executive officer Datuk Bridget Lai said it was important to provide efficient and personalised service in order to retain customers instead of spending millions on advertising.
“In fact, our brand essence is to build a good relationship and emotionally connect with our clients,” she said.
Despite its low advertising expenditure in comparison with other banks, Alliance Bank was seen to be doing well on the brand awareness index, Lai added.
For MIER reports click here