By Dr Chen Man Hin, DAP life adviser

PM Najib’s new year promises cannot succeed without first laying the foundations of real reforms.

In his new year message, the Prime Minister announced for the new year 2010, his government would achieve a high income economy for the people with the help of a NEW ECONOMIC MODEL AND BUILDING A RESERVOIR OF HIGHLY QUALIFIED PEOPLE TO MOVE AND MAN THE NEW ECONOMY.

These are stirring words, but the promises will remain a dream, because the Prime Minister has not laid the proper foundations for a New Economy.

The first step he should take is to LIBERALISE THE ECONOMY in the manner that China and the Four Asian Tigers have liberalised – which is a Free Market economy. A free market means there will be no regulations to hinder investors to come to Malaysia or stifle the ambitions of local businessmen.

The Prime Minister declared that his reforms will only impose a 12.5% bumiputra quota unlike the previous 30% of the NEP. Unfortunately, both foreign and local investors have not responded favourably, and FDIs (foreign investment inflows) are only a trickle. Foreign investors prefer to put their money in Indonesia, Vietnam and Singapore.

Other restrictions which discourage foreign investors are, despite what PM says, atill there – the old NEP structure, the tens of thousands of APs given out to UMNO cronies, NO OPEN TENDERS and a second extravagent EXPOMATRADE CENTER. The old NEP culture is very much in existence, and are discouraging the entry of both foreign and local investors into Malaysia.

It is tragic to see that the Prime Minister is unable to bring in genuine reforms to attract foreign investors.

FOREIGN INVESTORS BRING IN HARD MONEY AND MUCH NEEDED TECHNOLOGY.

To achieve a high income economy, the present system of low wage manufactring must give way to large scale high tech industries. Foreign investors have the technology, and it is therefore vital to attract foreign investment.

They will come only if the prime ministers jettisons away the NEP, cronyism, closed tenders, the APs and restricted procurement practices.

CREATING HUMAN CAPITAL.

It is vital that high quality education to given to our students to ensure that the graduates are trully qualitifed in all the disciplines necessary for a new economy – business, accounting, lawyers, engineers, IT technocrats, and research scientists. These are the people we need for the industriesa and factories. The universities and colleges must be top class. It is no use producing poorly qualified graduates who later cannot find employment because they are unemployable.

The MSC (Multimedia Super Corridor in Cyberjaya) was planned to be a California ‘Silicon Valley’ bristling with high-tech industries. It failed but India succeeded to create a Silicon Valley of the East in Bangalore, because their colleges produced armies of qualified engineers and technologists.

IMPORTANCE OF GOOD GOVERNANCE AND DEMOCRACY.

The government announced in parliament that last year, over 300,000 Malaysians have emigrated overseas. This is a tremendous loss of vital human capital with skills and talent. Unless the Prime Minister produces fundamental reforms to democracy and good governance, hundreds of thousands of young Malaysians may continue to migrate for greener pastures — with disastrous effect on the economy.