KUALA LUMPUR (June 11): Malaysia should get rid of the New Economic Policy (NEP) and replace it with a more inclusive framework that helps the poor regardless of race and religion, said former minister Datuk Seri Idris Jala.
"We have had the NEP for a very long time. We should get rid of it but we should not leave [a] vacuum. We should replace it with a new policy that is inclusive of all,” he said during a panel discussion on Tuesday.
The session, titled Economic Growth in Middle-Income Countries: How Can Countries Escape the Middle-Income Trap?, was organised by the World Bank Group.
“Come up with a policy that says we will help the poor in this country regardless of race and religion, whether it is Malay, Chinese, or Indian,” he said. “As long as they belong in the B40 category, we will apply equal affirmative action. That is the way to go.”
The NEP was introduced by the late Tun Abdul Razak Hussein in 1971 to reduce ethnic inequalities and eradicate poverty. It promoted Bumiputera participation in higher education as well as enterprise management based on the notion that Bumiputeras were the poorest in the country.
“To get out from the middle-income trap, it is going to be a lot harder than it used to be. We have to make some radical changes. We can’t keep playing the same game all the time,” he said, adding that such reforms would also encourage Malaysians living abroad to return home.
Idris was previously a minister in the Prime Minister's Department and the chief executive officer of the Performance Management and Delivery Unit (Pemandu) from 2009 until 2015. He was tasked to lead the Economic Transformation Programme (ETP), which was an initiative to transform Malaysia into a high-income country by 2020.
“If the exchange rate remained the same as it was back then, we would have definitely reached high-income status by 2015. We were outstripping it by 3%,” he said. “But the problem was the depreciation of the ringgit. In the Malaysian currency, we have already made it.”
Malaysia recorded a gross national income (GNI) per capita of US$10,400 (RM49,086) in 2015, according to the World Bank. At the time, the World Bank defined high-income economies as countries with a gross national income (GNI) per capita of US$12,475.
In 2022, the latest available figure, Malaysia recorded a GNI per capita of US$11,830, still lower than the World Bank’s definition for high-income economies of US$13,845.
Source: TheEdge - 12 Jun 2024
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