To propel Malaysia higher in the global economy value chain, the government must stop interfering too much in the macro economic aspects of the country.
GEORGE TOWN: The federal government should allocate more funds to cities and municipalities to spark better macro-economic activities if it wants to realise its economic transformation programme (ETP)’s aims.
A DAP parliamentarian said the big federal machinery was literally controlling every aspect of the economic sectors and this was unhealthy as it curtailed real growth from the ETP.
From Bukit Bendara MP Liew Chin Tong’s perspective, this did not provide leverage for the cities and municipalities to operate and to become financially secured, as the federal side contained or controlled most aspects.
“The federal-side should offer more financing to our cities and municipalities to boost innovation while encouraging everyone in the public sector to retain a competitive nature,” Liew proposed.
This in turn, would rejuvenate the private sector to be equally or more competitive globally, he added.
To propel Malaysia higher in the global economy value chain, Liew said the government must stop interfering too much in the macro economic aspects of the country.
Instead of dominating literally every aspects of the economic sectors, Liew opined that the government must facilitate and regulate, instead of trying to become the main driver in the growth engine.
“We do not need the government to just become a driver (drive the economy), but to become a regulator and an enforcer to ensure that corruption is not rampant and to uphold the law.”
He claimed that in Malaysia, the government has its hands full in everything until it could not excel in any.
“It should decentralise some of its business interests as this would boost competitiveness in both the public and private sectors.”
Liew, regarded as a DAP strategist, was speaking at a public forum entitled “evaluating the economic transformation programme (ETP)” on Friday night.
He was one of the four speakers which included non-profit research institute (REFSA) CEO Teh Chi Chang, academician Dr Ong Kian Ming and Bank Islam’s chief economist Azrul Azwar Tajudin.
Institute of Strategic and International Studies senior analyst Dr Muhammed Abdul Khalid moderated the three-hour long session.
Underlying flaws Liew stressed that the ETP was a well-intentioned plan to drive Malaysia towards a knowledge and high-income based economy.
But there were underlying flaws, which go unchecked, he claimed.
“One of it, is a too big of a government role in everything.”
He said this was akin to the Mahathirism policies of the 1980s-1990s decades where the government became largely involved in cultivating businesses when it should just become a regulator and an enforcer.
Citing examples, Liew said the government of today was the biggest stakeholder in banking, higher education, public transport, healthcare and affordable housing, through government-linked companies, nepotism, cronism, subsidiaries, and statutory bodies.
Liew also spoke about eradicating monopolising in the open-market of a cartel of telecommunication operators, a sole rice importer or, one major satellite television provider.
Despite the implementation of ETP and announcement of its successes, majority of the people have yet to enjoy the benefits of it, he claimed, citing statistics on the nation’s income disposal levels.
Now on an average, 40% of the estimated 28 million population only has a household monthly income of below RM1,500.
The wealth disparity is also widening by the day, he claimed. About 70% of the population lived in urban areas but, their disposal income was akin to living in rural areas, he pointed out.
There was a need to rethink many aspects of managing the economy’s direction as Malaysia continues to be reliant on foreign labour numbering at about two million, while there is an estimated one million skilled Malaysians working legally overseas.
The economic conditions in Malaysia is now quite similar to the Philippines, who was once upon a time the second biggest economy in Asia after Japan, but has since slipped into the doldrums, he said.
“Malaysia is now exporting engineers while Philippines, maids.”