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Macroscopic planning to lift sustainability

  • The government can no longer count on handout policies to stimulate the economy. We must create a more sustainable model to lift the national economy for the well-being of all Malaysians.

Translated by DOMINIC LOH
Sin Chew Daily

The market generally predicts that the government will adopt a more cautious and pragmatic approach for the upcoming 2017 Budget that will include growth-boosting packages while also taking care of the well-being of the rakyat.

However, given the sluggish external demand and weakening ringgit, the government will be facing mounting challenges when tabling next year's Budget.

It can be anticipated that the Malaysian economy will continue to rely on support from domestic demand, and the Budget will need to put in place additional measures to stimulate private consumption while boosting investment.

As such, it is generally believed that the government will focus on several growth areas such as public transportation, logistics, digital economy, value-added exports and tourist industry while offering more tax relief for the middle-income group and helping the people purchase affordable houses.

Undeniably, taking care of public needs and propelling economic growth have been the government's pledges all these years, and the government will honor these pledges as far as it could.

No doubt the Budget must address the near-term problems such as relieving the heavy living pressure on average Malaysians and improving the national economy's resilience.

With the general elections widely expected to be held next year, the government must strive to strike a balance between the elections and public interest to ensure that any measure introduced will benefit the country.

Between austerity and helping the poor, it is imperative that the government draw up more long-term macroscopic plans to effectively tackle the international as well as domestic economic and political reality.

Former second finance minister Ahmad Husni has pointed out that the Malaysian economy lacks sustainability and the country will soon trail behind some neighboring countries if economic transformation is not implemented. His statement indeed highlights our chronic disregard for macroscopic planning.

Malaysia's current economic model is overly dependent on migrant workers at the expense of more innovative and vibrant models. As we are unable to come up with more innovative products, we have been staying at the bottom of the production supply chain, and will need to continuously look to economies capable of churning out more value-added products for supply of innovative resources. This has caused us to fall behind our competitors in terms of financial and human capitals.

The government can no longer count on handout policies to stimulate the economy. We must create a more sustainable model to lift the national economy for the well-being of all Malaysians

In the meantime, in the face of stiff competition from other emerging regional economies, we must step up financial and human resources input in innovation.

Of course the government's initiatives will at best act as a catalyst. Whether the effort could be sustained depend very much on domestic and international investments as well as input from local businesses.

Consequently, the government must review its own shortcomings in effectively implementing the policies in the past, not to permit the top-down operation mode in government departments, but work as a team to bring about real transformation.


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