There is a need for more liberalisation

THERE is no doubt that the New Economic Model unveiled by Prime Minister Datuk Seri Najib Razak is a bold move by the government to address the sluggish economic growth and to increase foreign direct as well as local investments to propel the country from its middle-income status to a higher-income "new economy". Already part of the model relating to administrative reforms is being implemented in response to the needs of investors which could help certain sectors drive the creation of more high-paying jobs in the near future.

An important thrust that will underpin the model is the emphasis on more equitable opportunities so that each and every Malaysian would be able to realise their maximum potential. Details on this have yet to be unveiled or worked out just as details on how Malaysians are to move away from over-dependence on subsidies. They would, of course, be explained before NEM is implemented under the 10th Malaysia Plan.

The government is understandably cautious on the question of subsidies. While it needs to channel resources towards more productive investment, and therefore improve the country’s economic performance and GDP growth, at the same time it has to be mindful of the needs of the poor.

Those who had thought that the NEM would do away with the affirmative action programmes and institutions of the New Economic Policy completely will find that the many aspects of the policy would continue but in different forms. For instance, under the NEM the government will help all poor Malaysians regardless of race. "Affirmative action will consider all ethnic groups fairly and equally as long as they are in the low income 40% of the households," said Najib.

After more than three decades, the government boldly admitted that "excessive focus on ethnicity-based distribution of resources has contributed to growing separateness and dissension" among Malaysians.

But what is still unclear, and would probably be explained soon, is the fate of the many features of the NEP such as bumiputra quotas, involving university entrance, education scholarships, business licences, investments, government jobs and contracts and how they would figure in the new model. It is unlikely that they will disappear but will probably be handled by the Equal Opportunities Commission to ensure "fairness and address the undue discrimination when occasional abuses by dominant groups are encountered."

It is thus hoped that what has for a long time been taken for granted and abused would be properly managed to ensure that only the most deserving get the proper consideration for assistance. While it is thus understandable that there cannot be a radical departure from the present policy, the NEM must attempt to ensure equality of opportunities for as many Malaysians as possible while at the same time dismantle the many aspects of the policy that impede and discourage investments, be they foreign or local.

Source : www.sun2surf.com