Media Statement by Dr Chen Man Hin, DAP Life Advisor in Seremban on 14th November 2009
To achieve high income status for the people of malaysia requeires a revolutionary policy and full support from the people.
PM Najib stated that his intention was to raise the present per capita income of US$7,000 to US$17,000 by the year 2020, assuming that the GDP increases on an average of 9% a year.
Later he revised his targets after realising that the targets were unrealistic. His new estimates were a 6% GDP growth annually and achieve per capita income US$13,000 in 2020.
What are the prospects of achieving a pci of US$13,000 by 2020? Dim.
Historically, it would be near impossible. In 1957 at independence, Malaysia enjoyed a pci of about US$500, the second highest in Asia after Japan. In 2008, Malaysia pci was US$7,000. It took 51 years to reach US$7,000. Year 2020 is 11 short years away to reach US$13,000, when it took 51 years to reach US$7,000.
If PM Najib has a revolutionary policy and inspire the entire nation to rally and work exceedingly hard, the objectives might be achievable.
I do not see the government wholly committed to full liberalisation of the economy which would attract foreign and local investors to bring in more FDIs into the country. Investors are not convinced that the lukewarm reforms by the Prime Minister are liberal enough for them to bring in their cash for investment. Statistics show that FDIs for the first half of this year are very much lower than the FDIs in the first half of last year.
Although the reforms to revoke the NEP were announced, in practice there is still a 121/2 per cent bumiputra allocation. Moreover the NEP attitude. The NEP machinery and regulations and NEP dependence are still evident and practised.
PM needs reminding that NEP was the major factor that cause Malaysia’s economy to fall behind South Korea, Taiwan, Hong Kong and Singapore. Note the pci of US$18,000 for S.Korea, US$17,000 for Taiwan, US$34,000 for Hong Kong and US$34,000 for Singapore. Malaysia with a pci of US$7,000 is way behind. The reluctance of PM Najib to do away with the NEP will the doom for all his so called reforms.
Corruption is another factor which will hamper PM Najib to grow the economy faster. Many investors feel that corruption adds to the cost of investments, and would make their investments risky.
PM Najib has a herculean task ahead of him. His reforms have to be more fundamental and drastic. Putting up a show of reforms will not make Malaysia a high income country.
Dr Chen Man Hin
DAP Life adviser