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. Today’s Agenda (Week #5). Industrial policy and Industrialization
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Malaysian EconomyBachelor of Business Administration (BBA)
Professor Dr. Ahmad Bin Othman
School of Business and Management
University College of Technology Sarawak (UCTS)
96000 Sibu, Sarawak
Industrial policy and Industrialization
Phases of industrial policy
Five-year Malaysian Plans (10 plans)
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 (1957-1960), the economy was still heavily dependent on rubber and tin exports.
Attempt to industrialize (1960s) was started with the implementation ofimport-substitution policy, which was quite unsuccessful.
The Malaysia’s framework of the economy started when the First Malaysian Plan 1966-1970 was introduced.
The economic framework was continued with the implementation of the First Outline Perspective Plan 1971-1990(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 1991-2000(OPP2) was introduced. The main policy implemented in OPP2 was the National Development policy(NDP).
In 1991, National Development Policy (NDP) was introduced to replace NEP.
Vision 2020 was also introduced in 1991. it is a long term vision (1991-2020=30 years) containing broad policy directions encompassing various dimensions, i.e.
In summary, Malaysia’s key to economic success of the 1970s through the 1990s were;
Summary of Malaysian Development Policies
New Economic Policy (NEP) (1971-1990)
Establishment of new growth centers
The modernization of rural life
Rapid & balanced development of
Provision of a wide range of social
especially designed to raise the living
standards of the low income group
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.
New Economic Policy (NEP) (1971-1990)
Second Malaysia Plan (1971-1975)
Third Malaysia Plan (1976-1980)
Fourth Malaysia Plan (1981-1985)
Fifth Malaysia Plan (1986-1990)
Increase in GDP
Fairer distribution of income
Increase employment opportunities
Change of economic structure
With the aim to fulfill the objectives of Vision 2020, OPP2 was introduced in 1991.
OPP2 (1991-2000) was accomplished through the policies, strategies, and programs implemented in
-The sixth Malaysia Plan (1991-1995)
-The Seventh Malaysia Plan (1996-2000)
National Development Policy was the main policy during OPP2.
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:
United Malaysia objectives
Just and caring society
Mature democratic society
Fully competitive, dynamic, and resilient economy
Real GDP Growth . .
Average 1971- 80
Average 1981- 90
Average 1991- 2000
Average 2001- 05
National Planning Council
National Action Council
National Economic Action Council (NEAC), National Economic Consultative Council (NECC)
Implementation & Coordination Unit
Economic Planning Unit
Private Sector Dialogue
Inter-Agency Planning Group (IAPG)
Federal Ministries & Agencies
To achieve the goals & objectives of Vision 2020
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”
3. Addressing persistent socio-economic inequalities constructively and productively
4. Improving the standard and sustainability of the quality of life