Malaysia announces second stimulus package of $16 billion

Malaysia announced an unprecedented second economic stimulus package of $16 billion as it said the export oriented economy is in danger of sinking into deep recession.

Malaysiam Finance Minister Najib Razak, who is due to take over as premier soon, announced state spending that will equal 9% of the country���s GDP, even as the government warned that the economy could shrink by 1%, instead of growing at 3.5% as expected earlier. Malaysian exports have crashed by 28 % in January.

Back in Europe, EU finance ministers ruled out further stimulus packages for now, until the impact of the earlier ones filter through. The 16 Eurozone ministers said that they are not planning any additional budgetary effort, despite recent pleas from America that Europe raise its state spending measures.

The ministers also put out one of the gloomiest outlooks to date, and are expected to say that the recession in Europe will last well into 2010, as will unemployment. This comes even as UK and France turned in dismal industrial and manufacturing figures for last month, hitting historic lows.