KUALA LUMPUR, March 30 (Bernama) – The New Economic Model (NEM) policy thrusts are all-encompassing, holistic and well-crafted to address the new socio-economic landscape of the country as well as the world, says RAM Holdings Bhd Group Chief Economist, Dr Yeah Kim Leng.
“If executed boldly and wholeheartedly, it will enable the country to catch up with the fast growing economies like South Korea, Taiwan and Singapore that have left Malaysia far behind while our neighbours such as Indonesia, Thailand and Vietnam are closing rapidly,” he told Bernama here Tuesday.
Prime Minister Datuk Seri Najib Tun Razak on Tuesday unveiled the much-awaited NEM aimed at transforming the nation into a high-income economy that is sustainable and also position the country on the path to attaining developed nation status by 2020.
Under the NEM, plans include facilitating foreign direct and domestic direct investments in emerging industries and strengthening the competitive environment by introducing fair trade legislation.
Dr Yeah said a critical success factor of the NEM is the shift to growth led by the private sector, which accounts for more than three quarters of the economy.
Hence, facilitating domestic and foreign direct investment remains the key to realising the country’s full potential to be a high-performing economy and a favoured destination for investors, he said.
“Downstream industries in resource-based sectors such as palm oil, oil and gas, petrochemicals, agro-based and biotechnology industries and technology-based, advanced manufacturing in E&E, medical devices, machinery and equipment are examples of industries that have potential for expansion and value-adding,” he said.
On the divestment of government-linked companies (GLCs) in industries where the private sector is operating effectively, he said that the move should be supported on the grounds that it can unleash entrepreneurialship and risk-taking in the private sector as well as raise the efficiency and competitiveness of the industries concerned.
“It is also compatible with the shift to a market-friendly approach in implementing the country’s affirmative policy under the NEM,” he said.
Asked on what is still lacking in the NEM, Dr Yeah said the potential size and distribution of income and employment opportunities could be realised under the NEM through a private sector-led and market-based approach.