09/11/2011 (The Sun Daily) - Malaysia will not go bankrupt despite its high domestic debt as federal debt is low while debt of government-linked companies is widely spread out, said Harvard Alumni Association regional director for Asia Tan Sri Dr Lin See Yan.

"Our debt might be a bit high but very stable. I don't see Malaysia going bankrupt," he said, adding that a lot of the debt is held by the Employees Provident Fund, Tabung Haji and other big institutions.

Speaking to reporters at the Vistage CEO Talk today, Lin, a former Bank Negara deputy governor, said the debt level is manageable as long as the money is spent on projects that give returns that can service the debts.

As for next year's gross domestic product (GDP) growth, Lin expects it to come in at 4% to 5%.

"We have oil, gas and palm oil but we tend to underestimate our potential to grow. The idea is to translate the potential into actuality. That's what NEM is about but we are still talking about whether we should teach in English or BM (Bahasa Malaysia). We should be well past that," he said.

Lin also said that if Malaysia is competitive and serious about market share, it could have grabbed market share from Thailand which is in the midst of a crisis, but Malaysians did not do anything about it due to our "attitude problem".

He said the MRT project has enormous multiplier effects, especially if the contractors are local.

"They need to start it very quickly. Once the project starts, the population will begin to see the dynamics of the project," he said.

On the manufacturing sector, Lin said there must be education and restructuring to boost the sector.

"Manufacturing has to be restructured to value add, go up the chain... unless you do that, you'll never be able to get out. You have to automate, innovate," he said.

He said players in the sector need to reduce the use of foreign labour in order to move up the value chain.