1. Malaysian Economy Bachelor of Business Administration (BBA)
Week #1
4/19/2017
Malaysian Economy Bachelor of Business Administration (BBA)
Professor Dr. Ahmad Bin Othman
School of Business and Management
University College of Technology Sarawak (UCTS)
96000 Sibu, Sarawak
Malaysian Economy (MPW UCTS

2. Today’s Agenda (Week #5)
Industrial policy and Industrialization
Phases of industrial policy
Five-year Malaysian Plans (10 plans)

3. Industrial Policy Phases of Week #1 4/19/2017
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Malaysian Economy (MPW UCTS

4. Introduction
In the colonial period, Malaya was involved in production and processing of rubber and tin for export in return for imports of essential food and manufactured goods.
In the year of independence ( ), the economy was still heavily dependent on rubber and tin exports.
Attempt to industrialize (1960s) was started with the implementation of import- substitution policy, which was quite unsuccessful.

5. Framework of the economy
The Malaysia’s framework of the economy started when the First Malaysian Plan was introduced.
The economic framework was continued with the implementation of the First Outline Perspective Plan (OPP1). The main policy formulated in OPP1 was the New Economic Policy (NEP)
Vision 2020 was launched in 1991 as the broad policy directions of Malaysia. It provides the much needed guidelines of becoming a fully developed & industrialized Malaysia by the year 2020.
In relations to vision 2020, the Second Outline Perspective Plan (OPP2) was introduced. The main policy implemented in OPP2 was the National Development policy(NDP).

6. In 1991, National Development Policy (NDP) was introduced to replace NEP.
Vision 2020 was also introduced in it is a long term vision ( =30 years) containing broad policy directions encompassing various dimensions, i.e.
Economically
Politically
Psychologically
Spiritually
culturally.
In summary, Malaysia’s key to economic success of the 1970s through the 1990s were;
Basic policy framework, &
Industrialization strategies.

7. Planning Horizon . . . LONG TERM PLANNING Vision 2020, 1991-2020
First Outline Perspective Plan (OPP1),
Second Outline Perspective Plan (OPP2),
Third Outline Perspective Plan (OPP3),
MEDIUM TERM PLANNING
Five-year development plans, such as the Ninth Malaysia Plan ( )
Mid-term review (MTR) of the five-year Plans
SHORT TERM PLANNING
Annual Budget

8. Outline Perspective Plan (OPP1)
Summary of Malaysian Development Policies
RMK10
RMK9
RMK8
RMK7
RMK6
RMK5
RMK4
RMK3
RMK10
RMK9
RMK8
RMK7
RMK6
RMK5
RMK4
RMK3
RMK2
RMK1
OPP2
OPP1
RMK2
OPP3
RMK1
Vision 2020
OPP2
Outline Perspective Plan (OPP1)
66-70
71-76
77-80
81-85
86-90
91-95
96-00
01-05
06-10
11-15
16-20

9. New Economic Policy (NEP) (1971-1990)
Establishment of new growth centers
The modernization of rural life
Rapid & balanced development of
urban activities
Provision of a wide range of social
especially designed to raise the living
standards of the low income group
Raising productivity & income of those in low productivity occupation
Expansion of opportunity for inter-sectoral movement from low productivity to higher productivity activity
The creation of a Malay commercial & industrial community in all categories & at all levels of operation

10. Strategy of New Economic Policy
Eradicating poverty by raising income levels and increasing employment opportunities for all Malaysians
First
Accelerating the process of restructuring Malaysia society to correct economic imbalance, to reduce & eventually
eliminate the identification of race with economic function, and to ensure that Malay & other indigenous people will become full partners in all aspects of the economic life of the nation.
Second

11. Implementation NEP New Economic Policy (NEP) (1971-1990)
Second Malaysia Plan ( )
Third Malaysia Plan ( )
Implementation NEP
Fourth Malaysia Plan ( )
Fifth Malaysia Plan ( )

12. Evaluation of NEP (achievement)
Increase in GDP
Malaysia real GDP growth during ; averaged 7.1% annually.
In the 60s; averaged 5.2%
Grew from RM22.2 billion in 1971 to RM1,109 billion in 1990 per capita GNP grew by 8 times from RM1,109 to RM8,856 (US$ 860 to US$3406)
The annual inflation rate remained low.
Fairer distribution of income
With the regard to the distribution of income, there has been an increasingly fairer distribution of income among the various income group.

13. Evaluation of NEP (achievement)
Increase employment opportunities
rapid economic growth; creation of job, from 3.4 million in 1970 to 6.7 million in 1990.
the unemployment rate dropped from 7.7% in 1970 to 5.1% in 1990
Change of economic structure
from agriculture to manufacturing sector.
the transformation had enabled more Bumiputera work in more productive sector of economy (secondary & tertiary sector

14. National Development Policy (NDP) (1991-2000)
With the aim to fulfill the objectives of Vision 2020, OPP2 was introduced in OPP2 ( ) was accomplished through the policies, strategies, and programs implemented in -The sixth Malaysia Plan ( ) -The Seventh Malaysia Plan ( ) National Development Policy was the main policy during OPP2.

15. ORIENTATION TOWARDS SCIENCE AND TECHNOLOGY RESOURCE DISTRIBUTION
VISION 2020
NATION:
United Malaysian Nation
Common and Shared Destiny
Territorially Integrated
Ethnically Integrated
Living in Harmony
Full Partnership
Fair Partnership
One ‘Bangsa Malaysia’
Political Loyalty
Desicated to Nation
ECONOMY
Competitive
Dynamic
Robust
Resilient
POLITICS
Matured Democratic
Society
Consensual
Community Oriented
MORAL AND ETHICS
Fully Moral and Ethical Society
Strong in Religion
Highest Ethical
Standard
WELFARE
Fully Caring Society and Culture
Society Comes Before Self
Walfare – Family Responsibility
THE SOCIETY
ORIENTATION TOWARDS SCIENCE AND TECHNOLOGY
Scientific and Progressive Society
Innovative
Forward Looking
Contribute to Scientific and Technological Society
RESOURCE DISTRIBUTION
Just
Fair and Equitable Distribution of Wealth
Full Partnership in Progress
MENTAL FRAMEWORK
Psychological Liberated
Psychological Secure
Self Confident
Justifiably Proud
Robust in Facing Adversity
Pursuit of Excellence
Aware of its potentials

16. Vision 2020
Introduced in February 1991 Aims to achieve the status of a developed country that is distinctive and molded according to its own features without following: Developed not only in the economic sense but it must be fully developed along all dimension: -Economically -Spiritually -Politically -Technologically -Socially -Culturally

17. Vision 2020 Vision 2020 United Malaysia objectives
Just and caring society
Mature democratic society
Sustainable development
Fully competitive, dynamic, and resilient economy
Entrepreneurial
Vision 2020

18. Vision 2020 9
challenges:
To establish a united Malaysian nation with a sense of common and shared destiny
To create psychologically liberated, secure and developed Malaysian Society
To foster and develop a mature democratic society
To establish a fully moral and ethical society
To establish a matured, liberal and tolerant society
To establish a scientific and progressive society
To establish a fully caring society and caring culture
to ensure an economically just society
To establish a prosperous society, with an economy that is fully competitive, dynamic, robust and resilient.

19. Real GDP Growth . . ECONOMIC PERFORMANCE Average 1971- 80 7.5 %
2000
2001
2002
2003
2004
2005
2006e
7.5 %
5.8 %
7.1 %
4.5 %
8.5 %
0.3 %
4.4 %
5.4 %
5.3 %
6.0 %

20. DEVELOPMENT PLANNING MACHINERY
PARLIAMENT
Cabinet Ministers
National Planning Council
National Action Council
National Economic Action Council (NEAC), National Economic Consultative Council (NECC)
Draft
Policy
National Development
Planning Committee
Draft
Secretariat
Implementation & Coordination Unit
Economic Planning Unit
Private Sector Dialogue
Proposal
General framework
Inter-Agency Planning Group (IAPG)
Proposal
Consultations
Proposal
Circulars
Circulars
Federal Ministries & Agencies
State Governments
Private Sector

21. Ninth Malaysia Plan, 2006 – 2010 The National Mission, 2006 – 2020
1. Moving the economy up the value chain
5. Strengthening the country’s institutional & implementation capacity ~ establish a more effective implementing & monitoring mechanism
2. Raising the capacity for knowledge and innovation, and nurturing “first class mentality”
Five Key
Thrusts
3. Addressing persistent socio-economic inequalities constructively and productively
4. Improving the standard and sustainability of the quality of life
To achieve the goals & objectives of Vision 2020

22. Week #1
4/19/2017
You
Thank
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