Very ambitious and strong commitment to change
FROM THE EDGE FINANCIAL DAILY
KUALA LUMPUR: The New Economic Model (NEM) proposed by Prime Minister Datuk Seri Najib Razak takes a fresh approach to the country’s affirmative action and targets to more than double the income per capita of Malaysian households by 2010.( good!though I doubt it can happen so soon!)
In unveiling the proposals for the NEM prepared by the National Economic Advisory Council (NEAC), Najib said that the renewed affirmative action policy in the NEM would focus on raising income levels of all disadvantaged groups. ( this is the correct and long awaited move)
“It will focus on the needs of all our people — those living in the long houses in Sabah and Sarawak and poor rural households in Semenanjung Malaysia (Peninsular Malaysia), who often feel disconnected from the mainstream economic activity,” he said at the opening of the Invest Malaysia 2010 here on Tuesday, March 30.
According to the NEAC report, the focus of the NEM should be on the bottom 40% of Malaysia’s income strata — both individually and regionally as this group was disadvantaged and required special attention. This 40% of the households earn less than RM1,500 per month.
One of the three objectives under the NEM is to raise income per capita of Malaysian households that currently is US$7,000 (RM22,890) to US$15,000 by 2020, said Najib.
He said that it would be no easy task to achieve the goals set by the economic model but the rewards would be great.
Another salient observation from the NEAC report is that 80% of the workforce has education up to the Sijil Pelajaran Malaysia (SPM) level.( yes, a lot of dropouts even Chinese before SPM )“This is not in line with a high-income economy,” the prime minister said. “Creating a high-income nation will mean higher wages throughout the economy. Even wages for blue-collar workers will be based on them acquiring higher competencies, with their performance more readily benchmarked against international competitors. With more skills, comes greater responsibility, and better, higher paying jobs.”
The NEAC, headed by Tan Sri Amirsham Abdul Aziz, handed the report and recommendations for the formulation of the NEM to Najib. It would now be discussed by the various stakeholders in the government which include the component parties of Barisan Nasional, before being incorporated into the 10th Malaysia Plan scheduled to be unveiled on June 10 in parliament.
The final blue print for the NEM would only be firmed up in August when the 10th Malaysia Plan is approved.
Najib said that the renewed affirmative action policy would be market-friendly, merit-based, transparent and must be based on needs and not race.( hopefully WHATEVER POLICY CHANGE ,this time will be REAL!)
“For instance, one important consideration will be developing a competitive and transparent tender process, with set and clear rules for the whole bumiputera community, made of both Malay and other indigenous groups. This is set out as a common-sense enhancement of our policies for a new economic reality and where inclusiveness is a key component in our new economic model. In practice, this approach will mean greater support for the bumiputeras — a greater support based on needs, not race,” he said.
Apart from creating a higher-income economy, the other two principles of the NEM are sustainability of the economic activities and inclusiveness that will ensure no one is left out of the wealth-creation process.“
There is little value in pursuing a future based entirely on wealth creation. Pursuing growth that depletes resources and displaces communities will have dire consequences for future generations. This is a false and futile choice,” he said.( TRUE,VERY TRUE!)
He also realised that there would be some opposition to the NEM as it required a change in mindset.“
In the short term, there will be entrenched opposition. Some economic sectors may experience adverse effects. The process of change is never easy, and there will be painful moments. But for the long-term strength of our nation, we cannot afford to duck these issues any longer,” he said.In assessing the results of the NEM, Najib said that it should encompass the whole spectrum of measuring wealth such as equity ownership, other financial and non-financial assets, and access to wealth-creating opportunities such as long-term concessions and contracts.“
Even in measuring ownership, it should go beyond equity to include other properties, business assets such as retail, landed properties, commercial building, intellectual property and other services as well as managerial positions,” he said.
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