Minister says all the initiatives will be outlined in the 12MP and spill over into the 13MP
by SHAHEERA AZNAM SHAH / pic by RAZAK GHAZALI
MALAYSIA will push for a realignment of the country’s economy over the next 10 years as the old economic model of manufacturing, commodity and labour-intensive operations would hamper future growth.
The country for decades had been dependent on manufacturing from investment abroad, which created jobs but had failed to push for innovation and development of our own homegrown products.
Dependence on manufacturing and commodity had also stifled salary growth and high-paying jobs.
Economic Affairs Minister Datuk Seri Mohamed Azmin Ali (picture) said all the initiatives to realign the country’s economy will be outlined in the 12th Malaysia Plan (12MP) 2021 – 2025 and spill over into the 13MP 2026-2030.
“The government remains vigilant and continues to focus on strengthening Malaysia’s near-term resilience and advancing structural reforms to raise medium-term growth.
“The country’s growth potential will be optimised by strengthening productivity and innovation as catalysts of growth. Emphasis will be placed on empowering the manufacturing sector to produce more high quality, diverse and complex products,” he said in a statement yesterday.
Azmin said the RM56 billion allocated for the country’s development expenditure in 2020 will be utilised for 5,466 development projects to generate momentum and strengthen Malaysia’s longterm economic capacity.
From the total amount, RM53.2 billion will be allocated for 4,744 ongoing projects and the remaining RM2.8 billion will be set aside for 722 new projects.
Azmin said deeper focuses will be given to the high-growth sectors such as aerospace, electrical and electronics, medical devices production, machinery and equipment, as well as chemicals and chemical products.
“The development and modernisation of the resource-based industries through research, development, commercialisation and innovation initiatives will also be given priority,” he said.
Meanwhile, the government’s [email protected] initiative announced in Budget 2020 is expected to support household spending for the next five years, coupled with the upward revision of minimum monthly wage, Azmin said.
“Malaysia’s household spending will continue to be supported by wage growth and favourable employment prospects, in line with the [email protected] initiative announced in Budget 2020, with a total allocation of RM6.5 billion for the next five years.
“The upward revision of the minimum monthly wage rate to RM1,200 beginning Jan 1 next year in 57 cities and municipalities across Malaysia, along with cash transfer programmes, income tax refund and lower cost of borrowings, is also expected to provide additional impetus to household spending,” he said.
In boosting economic activities in the country, the government has identified 15 Key Economic Growth Areas as the new fundamentals of growth, including Islamic finance hub 2.0, Commodity Malaysia 2.0 and the Industrial Revolution 4.0.
Recognising the importance of infrastructure projects in boosting the country’s supply chain, Azmin said the government has emphasised some of the strategic projects in the 12MP.
“During the first nine months of 2019, significant levels of foreign and domestic investments amounting to RM149 billion have been approved.
“Recognising the importance of infrastructure projects to facilitate supply chains and the mobility of goods and people, several strategic projects will be continued in the 12MP such as the Pan Borneo Highway, East Coast Rail Link, Bandar Malaysia and GemasJohor Baru Electrified DoubleTracking Project,” he said.
On the global front, Azmin said the country will continue to leverage on its open trade policy, especially in pursuing a greater unification with Asean.
“Malaysia will continue to adopt an open trade and investment policy, particularly to pursue greater integration with Asean, leveraging on the region’s large population size of more than 600 million people.
“The hosting of the Asia-Pacific Economic Cooperation Summit and Visit Malaysia Year 2020 will be catalysts for growth, particularly for the tourism industry,” he said.
On the performance of Malaysia’s economy, Azmin said the government is confident of achieving 4.8% in GDP growth next year due to the country’s strong macroeconomic fundamentals.
“Malaysia has a highly diversified economic and export structure, supportive labour market, low and stable inflation, a strong and well-capitalised financial sector and a healthy current account surplus of the balance of payments.
“This outlook is higher than the estimates by the International Monetary Fund at 4.4% and the World Bank at 4.5%, as the government remains committed to implementing its development priorities,” he said.