Najib launches stale economic plan, no sign of NEM

ARCHIVES 2010

By admin-s On Jun 10, 2010

By Malaysia Chronicle

As expected, Prime Minister Najib Razak’s rollout of the 10th Malaysia Plan drew a big yawn – not just from opposition MPs but also from market analysts who slammed the five-year economic development proposal as a rehash of old ideas and proposals from as far back as the Mahathir administration.

Conspicuously absent were further details of the New Economic Model that Najib has been trying to launch to take over from the New Economic Policy. Najib, who is also finance minister, had promised the NEM would further liberalize the economy and lift the decades-old race-based protectionism offered under the NEP.

“This omission carries a serious signal. It shows his political clout is waning and right-wing groups like Perkasa and Mahathir are now dictating the tune, not him,” Batu MP Tian Chua told Malaysia Chronicle.

“The Plan he has unveiled today is mostly old stuff. It tries to be ambitious and sounds grand but it will not deliver its target because it does not address the core problems of efficiency, competitiveness and meritocracy. The previous nine Plans launched by Mahathir and Abdullah Badawi also failed because of this.”

Lack of details

Tian was referring to ultra-Malay rights group Perkasa, which is under the patronage of former premier Mahathir Mohamad. It has been very vocal about any moves to take away the special economic rights of the Malays and has threatened nationwide street protests if Najib went ahead with his proposed NEM.

Ignoring the lukewarm response in Parliament where he was tabling the Plan, Najib forecast average economic growth of six per cent over five years while pledging to cut the fiscal deficit to 2.8 per cent of gross domestic product in 2015.

He also pledged to win back foreign investors and open up the economy to more competition.

“Basically, the Plan seeks to distribute RM230 billion in spending for development over the next five years. It is crucial as the economic dynamism has shifted geographically and structurally,” Dr PHS Lim, chairman of the Malaysian Investors Association, told Malaysia Chronicle.

“But we cannot live on grandiose plans and big visions alone. Frankly, the PM needs to give more details on how we are going to achieve the targets if we are to win back investor confidence.”