Oleh/By : THE HON. DATO SERI DR
MAHATHIR BIN MOHAMAD
Tempat/Venue : PARLIAMENT
Tarikh/Date : 03-04-2001
Tajuk/Title : THE THIRD OUTLINE PERSPECTIVE
PLAN (OPP3)
Penyampai : PM
Before I table the Third Outline Perspective Plan
(OPP3) for 2001 - 2010, I would like to draw the
attention of the House to Malaysia's record of
development since independence. As a multi-racial,
multi-religious and economically divided nation,
Malaysia was a nation least expected to remain peaceful
and to develop. There were dire predictions, that
racial conflicts would be a permanent feature and the
Malays who made up the majority would seize power and
rob the other communities. In the event we have proven
our detractors totally wrong.
2. For this remarkable achievement the whole nation
must thank the greatest Malaysian leader of all, The
Late Honourable Tunku Abdul Rahman Putra Al-Haj. It
was he who devised the special inter-racial cooperation
which today is being copied not only in this country
but also many other developing countries with ethnic
divides. Without losing their racial identities, the
various ethnic political parties were able to ride
under the banner of an Alliance which functions more
like a single party than a coalition of parties.
3. This is the formula which brought about stability
and economic development in Malaysia. If Malaysia is
to continue to be peaceful and to grow rapidly, it is
important that the protagonists of this unique system
of racial cooperation should stay in power. Synthetic
copies are most unlikely to achieve the same results.
4. Unfortunately the original practitioners of
racial cooperation are now faced with the politics of
hatred, religious deviationism, racism and street
violence. It is difficult to understand why people in
a peaceful rapidly developing Malaysia should want to
imitate the ways of countries which have not been able
to stay peaceful and to develop. But the fact is that
some in Malaysia are not happy that the country is
peaceful and the economy is doing well. They hanker
after turmoil and violence, injury and death even.
They are forever looking for issues and incidents to
exploit. While they propound democracy, they are not
prepared to accept the decision of the majority. They
are not prepared to wait for general elections but wish
to grab power illegitimately.
5. Recently a fight broke out between a few Malays
and a few Indians. Immediately certain people tried to
influence feelings among both communities in order to
break the peace that Malaysia enjoys. It is well-known
that certain individuals wish to see the Malaysian
Government fall through street violence. They had
intimated this to their foreign sympathisers. But this
Government will not hesitate to enforce Malaysian laws
even if we will be condemned by the foreign media and
certain foreign quarters.
6. Malaysia's well-being is the responsibility of
the Malaysian people and their elected Government. We
have shown that when Malaysian interests are at stake
we are ready to break from the so-called international
norm. We know that our critics and detractors are no
angels and when it suits them, they will ignore common
decency even. And so if the peace and stability of
this country is threatened, having foreign friends to
back their illegal acts will not save them from the
full force of Malaysian laws. This Government will act
and act decisively to protect this country from foreign
manipulations and their proxies in this country.
7. As I pointed out Malaysia has developed rapidly
since independence. This has been achieved despite
continuous opposition and harassment by the opposition
every step along the way. Every project to improve the
living standard of the people has been condemned,
opposed and obstructed.
8. Thus when the Government developed the Muda
Irrigation Scheme (MADA) for padi double-cropping, the
Opposition condemned it as impractical, the land is not
allowed to fallow, the padi farmers would have to work
throughout the year. Today the very people who opposed
MADA not only enjoyed the extra income they got but
would get angry if they cannot do double cropping.
9. It is the same with all the other policies and
projects. If their opposition is acceded to there
would be no Penang Bridge, no North-South and other
expressways, no Subang Airport and KLIA, no Proton, no
DEB, no Malays in business, and certainly none in the
corporate sector or the professions. In fact bereft of
all these Malaysia would be a Third World basket case,
begging for aid and being forced to obey foreign powers
and international agencies. We can see the kind of
country we would be by looking around us.
10. Fortunately the Alliance and the Barisan Nasional
Government were given overwhelming support by the
people and we were able to ward off opposition from the
opposition parties and develop the country and enrich
the people.
11. The OPP3 outlines the policies and direction of
Malaysia's development in the next 10 years. The
National Vision Policy will be opposed by the
Opposition because all the Opposition knows is to
oppose. They have never come up with any constructive
ideas to help the country develop.
12. The Barisan Nasional Malaysian Government will not be
deterred by the negative attitude of the Opposition. We
will definitely carry out the National Vision Policy with
all the means in our power for the good of Malaysia and all
Malaysians.
13. It is with this awareness that the Opposition will
raise baseless criticisms during the debate on the Third
Outline Perspective Plan and the National Vision Policy and
will deliberately prevent Malaysia's development that I will
present the OPP3, to take the country further towards Vision
2020, a Malaysia that is fully developed and at par with
other developed countries.
14. I beg to move the following motion:-
" That this House,
recognising the significant progress made in the socio-
economic development of the nation during the last ten
years under the Second Outline Perspective Plan 1991-
2000 and the National Development Policy;
acknowledging and endorsing the continuous efforts of
the Government in implementing policies, strategies and
programmes in order to achieve the objectives of the
Second Outline Perspective Plan through the National
Development Policy, that is to attain balanced
development in order to establish a more united and
equitable society;
approves and endorses the Third Outline Perspective
Plan, 2001-2010 and the National Vision Policy, which
seek to provide respectively the development objectives
of the nation and the policies that will be followed in
this decade, as set out in Command Paper No. 11 of
2001;
that in approving the Third Outline Perspective Plan
and the National Vision Policy, all segments of
Malaysian society are required to relentlessly strive
for greater success in the face of increasing domestic
and global challenges ahead, and stand united in our
efforts to build a resilient and competitive nation. "
15. With your permission, I, therefore, table the
Third Outline Perspective Plan (OPP3) (2001-2010) and
the National Vision Policy for deliberation by
Honourable Members of this House.
16. The OPP3 document before us is of special
significance for succeeding generations and for us. It
is tabled at the beginning of the 21st century and
contains policies and programmes that will be
implemented in the first decade of the century. Having
attained remarkable success since the launching of the
New Economic Policy (NEP) and the National Development
Policy (NDP), we should forge ahead with determination
to attain the objectives so that the rakyat who have
placed their faith in this Government will not be
disappointed.
17. In Malaysia, we take planning for national
development very seriously. For us, plans are important
to set out the course for the nation to take in its
development. The seriousness with which we undertake
development planning in Malaysia is best demonstrated
by the efforts that are made in the preparation of
OPP3.
18. In the formulation of OPP3, we established the
Second National Economic Consultative Council (MAPEN
II), which was composed of 154 members representing
various sections of the Malaysian society. Their
ability to deliver the final report on time enabled the
Government to consider the views expressed before
formulating the plan. Although it was not possible to
accept all the recommendations, the Government in full
earnestness and sincerity had considered all the
proposals carefully.
NATIONAL DEVELOPMENT POLICY
19. The National Development Policy (NDP), which was
launched in 1991 to succeed the NEP, set the broad
economic development framework for the last 10 years.
While maintaining the basic strategies and broad
objectives of the New Economic Policy (NEP), the NDP
incorporated several new dimensions, namely, focus on
hardcore poverty, emphasis on the rapid development of
an active Bumiputera Commercial and Industrial
Community (BCIC), greater reliance on the private
sector to achieve the restructuring objective, and the
strengthening of human resource development.
MACROECONOMIC PROGRESS
20. The policies and strategies of the NDP
contributed towards strengthening Malaysia's position
as a modern industrial economy and brought significant
economic and social progress. The country witnessed
improving standards of living and the strengthening and
diversification of its industrial base. The economy,
however, suffered a severe setback in 1998 due to the
Asian financial crisis, but as a result of the measures
introduced by the Government and the strong economic
fundamentals existing before the crisis, we succeeded
in turning around the economy within a short period of
time and were able to place it on a much stronger
footing to face future challenges.
21. Despite the crisis, the economy achieved an
average growth rate of 7.0 per cent per annum for the
period 1991-2000, as targeted under OPP2. More
importantly, growth was achieved in an environment of
low inflation, price stability and full employment.
The per capita income increased at an average rate of
7.8 per cent per annum and doubled from RM6,298 to
RM13,359 between 1990 and 2000.
22. The impetus for the strong growth during the
decade came from the private sector as well as exports,
unlike the high level of public sector involvement in
the economy in the 1980s. This was in keeping with
Government strategy to promote the private sector as
the engine of growth.
23. In addition, the large inflow of foreign direct
investment (FDI) into the manufacturing sector added
capacity in the export-oriented industries, including
the oil, gas and petrochemical sector and investments
in capital-intensive and high technology areas, and
contributed to the higher rate of private investment.
The inflow of FDI remained steady even during the
crisis. We managed to get greater amount of
reinvestments from the MNCs that had already
established their operations here. This demonstrates
the continued confidence of foreign long-term investors
in our economy. It is also encouraging to note that a
major portion of the FDI inflows was in high technology
industries as well as in the IT sector which is
currently being emphasised.
24. Private investment was severely affected in 1998
as a result of the decline in demand and loss in
investor confidence resulting from the financial
crisis. To reduce the severity of the economic
contraction, the Government adopted a fiscal stimulus
package and an accommodative monetary policy. Public
investment focused on infrastructure development and
enhancing productivity and efficiency to support
private sector initiatives and fulfil the rising demand
for better services from an increasingly sophisticated
society.
25. Exports also became an increasingly important
contributor to growth. Locally made products were able
to compete successfully and penetrate global markets,
including the developed countries. Exports were
particularly crucial in propelling the recovery from
the financial crisis. Exports grew at an average rate
of 16.7 per cent and became even stronger between 1998-
2000, surpassing the target set under the Second
Outline Perspective Plan.
26. The Asian financial crisis had to some extent
affected the achievement of socio-economic goals.
However, Malaysia emerged more resilient and
fundamentally stronger after the crisis. The current
account of the balance of payments turned around and
strengthened following significant growth in
merchandise exports. The merchandise account recorded
the largest surplus ever of RM86.5 billion in 1999.
27. The Government was committed to contain the
external debt at a manageable level and, therefore,
selectively prepaid its more expensive external loans.
As a result, the external debt of the Federal
Government declined from RM24.7 billion at the end of
1990 to RM13 billion at the end-1997. However, as a
result of the financial crisis, the Government raised a
small amount of funds from external sources to
undertake counter-cyclical spending for Malaysia's
economic recovery.
SECTORAL PERFORMANCE
28. In sectoral terms, manufacturing grew at 10.4 per
cent per annum and led economic growth during the OPP2
period. The sector witnessed improvements in productive
efficiency and capability, continued expansion of
export-oriented industries as well as greater
diversification of its market.
29. Growth of the construction sector was
particularly rapid during the 1991-1997 period. The
civil engineering sub-sector was boosted by the
privatisation of large infrastructure and civil
engineering projects, such as roads, highways,
airports, power generation, telecommunications, rail
transport and ports. However, the construction sector
contracted in 1998 and 1999, before recovering slightly
in 2000.
30. Growth in the agriculture sector mainly came from
the palm oil and food crop sub-sectors. In line with
the Third National Agriculture Policy (NAP3), the
development of the sector was reoriented towards the
optimal utilisation of resources in both the industrial
commodity and food sub-sectors through improvements in
productivity and competitiveness.
31. The Government also took steps to develop the
services sector as a new source of growth as well as to
improve the competitiveness of the services industries
in preparation for an increasingly liberalised
environment.
PROGRESS IN POVERTY ERADICATION AND RESTRUCTURING
32. The nation achieved significant progress in terms
of poverty eradication, restructuring of employment and
the development of the Bumiputera Commercial and
Industrial Community. Corporate equity ownership by
Bumiputera, however, declined marginally compared with
the 1990 level.
33. The incidence of poverty among Malaysians was
reduced to 7.5 per cent in 1999. A total of 351,100
households were lifted out of poverty. The incidence
of poverty in both rural and urban areas declined by
almost half their levels in 1990. The incidence of
poverty among the Bumiputera, however, remains highest
when compared with the other ethnic groups.
34. In terms of restructuring, the share of
Bumiputera ownership of corporate capital initially
increased from 19.3 per cent in 1990 to 20.6 per cent
in 1995. As a result of the economic crisis, their
share fell to 19.1 per cent. The share of non-
Bumiputera ownership of corporate capital also
declined, while the foreign ownership rose following
the liberalisation of foreign investment to accelerate
the recovery process. However, both the Bumiputera and
non-Bumiputera registered absolute increases in their
equity ownership.
35. The privatisation programme served as an
important vehicle to enhance Bumiputera participation
in the corporate sector. Companies undertaking
privatised projects were required to provide at least
30 per cent equity to Bumiputera as well as allocate at
least 30 per cent of contract-works of major privatised
projects to Bumiputera contractors.
36. The proportion of Bumiputera in the professional
and technical as well as administrative and managerial
categories increased during the period. The
implementation of programmes for Bumiputera commercial
and industrial community also helped to increase the
number of Bumiputera enterprises in both the corporate
and non-corporate sectors.
37. In terms of regional development, states that
engaged in modern sector activities grew rapidly. The
greater economic opportunities available in urban
centres continued to attract migrants, and as a result,
there are more Malaysians living in urban areas than in
rural areas. About three-fifth of Malaysians lived in
urban areas in 2000 compared with about half in 1990.
The increase in urban population has resulted in a new
phenomenon, that is, the expansion of squatter
settlements and the emergence of relative poverty in
the urban areas among Bumiputera and the Indian
community.
NATIONAL VISION POLICY
38. Ten years ago, the country adopted the Vision
2020 concept to set the country's strategic direction
for the next 30 years. The successful implementation of
the National Development Policy during the 1990s, which
marks the first phase of Vision 2020, has enabled the
country to achieve rapid growth with wide-ranging
transformation of its economic, social, physical and
institutional landscape.
39. We have now moved into the second phase of Vision
2020. During the next 10 years, the National Vision
Policy (NVP) will form the basis of the strategies and
programmes under the OPP3. The National Vision Policy
is aimed at establishing a progressive and prosperous
Bangsa Malaysia that lives in harmony and engages in
full and fair partnership. Economic growth will be
promoted alongside efforts aimed at poverty eradication
and restructuring of society, as well as reducing
social, economic, and regional imbalances. While
improving material welfare and raising the level of
prosperity, special effort will also be made to instil
positive social and spiritual values to balance rampant
materialism. In addition, the National Vision Policy
pursues environmentally friendly and sustainable
development to ensure that the environment is clean,
healthy and attractive as well as capable of sustaining
the nation's needs and aspirations.
THEME
40. In recognition of the challenges ahead arising
from globalisation, national development policies will
be directed towards building a resilient and
competitive nation. It will no longer be possible to
use national borders to protect low-quality and high-
priced products in the domestic market. We Malaysians
will have to be more disciplined and competent in
whatever we do in order to produce goods and services
that can compete in the global marketplace. The recent
financial crisis showed the importance of strategic
thinking and of increasing resilience because in a
borderless world, events in any part of the world can
have tremendous repercussions on our country.
41. The onset of the Information Age, a more
integrated global economy and greater liberalisation
have changed the rules of competition. Knowledge rather
than factor inputs determines a country's
competitiveness. Malaysia's comparative advantage in
traditional manufacturing is being challenged by
dynamic lower-cost developing countries, while
industrialised countries are forging ahead with their
focus on knowledge and ICT. As a nation, we will have
to intensify our efforts to increase our productivity
and competitiveness not only to stay ahead of the
developing countries but also to catch up with the more
developed countries, so that we can emerge as a
developed nation come 2020.
42. Domestically, our total factor productivity the
contribution of factors other than labour and capital
is still low and the rising incremental capital output
ratios during the 1990s mean that we need to intensify
our efforts to increase the efficiency of capital
utilisation. Our strategy for sustained growth must be
built on the basis of increased productivity arising
from high knowledge content and efficiency. There is
the need to identify new growth areas, broaden and
deepen the existing sources of growth, and widen the
range of exports as a strategy to increase economic
resilience. This will include the development of the
food industry, supported by a modern agriculture
sector.
43. In addition, Malaysians should always be mindful
of the peace and harmony that the country is blessed
with. Peace and harmony form the bedrock on which all
our development efforts are built. There could be no
real progress if the country is torn apart by
dissension and strife. Accordingly, we should forge
national unity and nurture a tolerant and caring
society for the well-being and prosperity for all. If
our plea for rationality in the expression of
dissatisfaction over political, economic or social
issues are ignored, we must accept the need for a
stricter enforcement of the laws of the country.
NEW DIMENSIONS
44. While incorporating the key strategies of
previous policies, such as the New Economic Policy and
National Development Policy, the new dimensions of the
National Vision Policy are as follows:
developing Malaysia into a knowledge-based
society;
generating endogenously-driven growth through
strengthening domestic investment and developing
national capability, while continuing to attract
foreign direct investment (FDI) in strategic areas;
increasing the dynamism of agriculture,
manufacturing, and services sectors through greater
infusion of knowledge;
addressing pockets of poverty in remote areas
and among Orang Asli and Bumiputera minorities in Sabah
and Sarawak as well as increasing the income and
quality of life of those in the lowest 30 per cent
income category;
achieving effective Bumiputera participation as
well as equity ownership of at least 30 per cent by
2010;
increasing the participation of Bumiputera in
the leading sectors of the economy; and
reorientating human resource development to
support a knowledge-based society.
KEY THRUSTS
45. The National Vision Policy will help to
strengthen the country's competitiveness and
resilience, as well as build an equitable society to
ensure stability and unity. The key thrusts of the
National Vision Policy are as follows:
building a resilient nation by fostering unity,
inculcating the spirit of patriotism, nurturing
political maturity, cultivating a more tolerant and
caring society with positive values, raising the
quality of life, as well as increasing economic
resilience;
promoting an equitable society by eradicating
poverty and reducing imbalances among and within ethnic
groups as well as regions;
sustaining economic growth by identifying and
strengthening the sources of growth, the financial and
corporate institutions as well as macroeconomic
management;
enhancing competitiveness to meet the
challenges of globalisation and liberalisation;
developing a knowledge-based economy as a
strategic move to raise the value added of all economic
sectors and optimising the brain power of the nation;
strengthening human resource development to
produce a competent, productive and knowledgeable
workforce; and
pursuing environmentally sustainable
development to ensure long-term growth.
BUILDING A RESILIENT NATION
46. For the nation to be resilient, the people will
have to be united, politically mature, tolerant, caring
and enjoy a higher quality of life.
47. Malaysians should strive for political maturity
and not be sidetracked into parochialism and extremism
in their views. For a united and harmonious Malaysian
society, there should be tolerance and acceptance of
the diverse traditions of our multicultural society.
48. To succeed as a nation, we must be prepared to
work hard and work smart, be disciplined and have good
work ethics. We should uphold good values and ethics of
the people and the nation because in the final
analysis, they determine the rise or fall of a nation.
ECONOMIC PROSPECTS FOR 2001-2010
GLOBAL ECONOMIC PROSPECTS
49. Let me touch on briefly the prospects for the
global economy.
50. The long-term outlook for the global economy is
expected to be positive with real GDP growth projected
to increase in all major regions. The world economy is
expected to expand by 2.3 per cent annually between
2001-2010, while the developing countries are also
expected to grow at an average rate of 3.7 per cent.
Nevertheless, the presence of economic and financial
imbalances between rich and poor is significant and
poses continued risk to the Malaysian economy. The
continued lack of constructive initiatives to
strengthen the international financial architecture,
particularly in respect of the increased movement of
speculative short-term capital, remains a potential
source of instability.
SUSTAINABLE ECONOMIC GROWTH
51. Given this outlook, Malaysia's ability to sustain
rapid economic growth for the OPP3 period will hinge on
our ability to strengthen economic resilience and
competitiveness. As such, the focus of macroeconomic
management will be to strengthen economic fundamentals
so as to ensure sustainable long-term growth with low
inflation and stable prices, as well as maintaining a
healthy resource and external balance position. The
development of the knowledge-based economy is expected
to provide a platform to improve Malaysia's
productivity.
PRODUCTIVITY AND EFFICIENCY
52. During the OPP3 period, the economy is targeted
to grow at an average annual rate of 7.5 per cent. The
major source of growth will be from productivity gains
arising from improvements in technology and production
process as well as increased use of information and
communication technology (ICT). New domestic and
foreign investments will also contribute to economic
growth.
53. To build a strong base for an endogenously-driven
growth, efforts will be made to strengthen indigenous
capabilities in innovation and technology development
as well as human capital. Measures will be taken to
improve the level of education, intensify skills
training, and attract highly specialised foreigners and
Malaysians abroad as part of our "brain gain" strategy.
AGGREGATE DEMAND
54. Private consumption is expected to increase at
7.4 per cent annually in real terms due to higher
disposable income and positive wealth effect. With
policies to strengthen investment, private investment
is expected to register a strong average growth rate of
12.7 per cent. Foreign direct investment will continue
to be promoted, especially in capital-intensive and
high-technology industries. Domestic investments will
be further promoted to accelerate the development of
local industries as well as create Malaysian
multinational corporations (MNCs) in order to broaden
the industrial base and composition. This will include
enhancing Malaysia's resource-based and food industries
which have potential for import substitution and
export.
55. In this regard, local businesses and institutions
are encouraged to collaborate with foreign businesses
to form strategic alliances in R&D, product design,
production, distribution and marketing. They should
manufacture capital and intermediate goods in areas
where Malaysia has competitive advantage to supplement
and substitute for the import of such goods and also
for export. Malaysian businesses should strengthen
their linkages with MNCs in order to take advantage of
global outsourcing and be part of the global value
chain.
56. The development of small and medium-scale
enterprises (SMEs) will be promoted to increase inter
and intra-industry linkages and strengthen the
industrial base. To enhance the contribution of SMEs to
economic growth, efforts will be taken to improve their
financial management and marketing skills as well as
strengthen their links with large-scale industries. A
specialised industrial zone with support services will
also be established for SMEs in order to achieve
economies of scale. Efforts will also be made to assist
industry clusters to share resources such as
information, experience and innovation as well as
produce final goods and services in an integrated
manner. Promising local enterprises will be provided
appropriate incentives and support to enable them to
compete successfully.
57. Exports, particularly manufactured products, will
remain a major contributor to our economic growth.
Aside from electric and electronic products, the
exports of agro-based and resource-based manufactured
products are expected to increase with the expansion in
domestic processing of agricultural products as well as
the development of Malaysia as an international halal
food hub. The share of capital and intermediate goods
will continue to constitute a major portion of imports.
However, with increasing domestic capability to produce
some of these goods, including the greater
participation of SMEs, imports are expected to grow at
a slower rate. By 2010, the per capita GNP is expected
to reach RM23,610 in nominal terms in an environment of
price stability and low inflation.
SECTORAL GROWTH
58. On the sectoral side, the manufacturing, services
and agriculture sectors will provide the impetus for
economic growth during the OPP3 period. These sectors
are expected to strengthen following the development of
the knowledge-based economy, which will accelerate the
infusion of technology and modern management practices
to increase value added and productivity.
59. The manufacturing sector will grow at an average
rate of 8.3 per cent per annum with its share of GDP
rising to 36.0 per cent by 2010. Among the measures
that will be undertaken will include the adoption of a
pro-business policy environment, encouraging strategic
alliances in high value-added and high-technology
industries, strengthening the technological base as
well as widening the export base and diversifying
export markets. Activities in the sector will continue
to be heavily concentrated in the electrical and
electronic industry, which is expected to become
increasingly diversified and sophisticated. Resource-
based industries, such as petrochemical,
pharmaceutical, oleo-chemical, wood-based as well as
food and agriculture products, will be promoted
alongside other industries such as automotive,
aerospace and fabricated metal products. The
development of SMEs will be emphasised to increase
their contribution towards the mainstream of industrial
activities and exports.
60. During the OPP3 period, the services sector will
be promoted as a catalyst for growth and a potential
source of exports to strengthen the balance of payments
position. A more efficient services sector will be
developed to promote greater industrial efficiency and
competitiveness. The focus of the tourism industry will
not be just to increase tourist arrivals but to
encourage them to stay longer, spend more and revisit
Malaysia. Port services will be expanded to make
Malaysian a maritime nation. At the same time, efforts
will be made to develop KLIA as an aviation hub for
Southeast Asia.
61. Steps will be taken to revitalise the agriculture
sector to enhance its contribution to growth and wealth
creation. Emphasis will be given to food production
through greater involvement of the private sector in
modern and large-scale farming, particularly in the
permanent food production areas. In addition, new
sources of growth will be exploited particularly in the
high value herbal-based products, ornamental fish and
floriculture, biotechnology industry as well as agro
and eco-tourism. For rubber, efforts will be made to
improve its viability by increasing yield, promoting
Latex Timber Clones, adopting new technologies and
integrating rubber plantation with other economic
activities. Efforts to promote reverse investments for
food and plantation crops will continue to ensure
supply of raw materials to industries and for food,
while taking advantage of the cheaper production cost
and the availability of resources overseas.
62. During the OPP3 period, the rate of inflation
will be kept low. Efforts will also be made to keep
wage increases in line with productivity improvements.
Measures to encourage automation and labour-saving
techniques as well as encourage higher participation of
women and retirees in the labour market will reduce
labour demand pressures. At the same time, farming
activities will be better organised along the lines of
the manufacturing industries.
63. With the economy back on track, the public sector
is expected to revert to its role as the facilitator
for the private sector, which will be the engine of
growth. The growth rate of the Federal Government
operating expenditure will be lower as a result of
prudent fiscal management and efficient use of
resources. Priority will also be accorded to human
resource development. In line with establishing a world-
class public sector, the Government will also continue
to recruit competent and well-qualified people to
enhance the quality of the public service.
BUILDING A UNITED AND EQUITABLE SOCIETY
64. The Government will continue to pursue the
distributional agenda to ensure balanced participation
among and within ethnic groups as well as sectors and
regions. The National Vision Policy maintains the
basic two-pronged strategy of the New Economic Policy,
that is, poverty eradication irrespective of race and
restructuring of society in the context of rapid
economic growth.
POVERTY ERADICATION AND INCOME DISTRIBUTION
65. We have made very good progress in poverty
eradication. By 2005, we intend to reduce the incidence
of poverty further to 0.5 per cent. To realise this
target, the anti-poverty programmes will be more target-
specific and address pockets of poverty in different
regions, particularly in remote areas as well as among
disadvantaged groups such as the Orang Asli and other
Bumiputera minorities in Sabah and Sarawak. To increase
programme effectiveness, existing anti-poverty
programmes will be consolidated and revitalised under
Skim Pembangunan Kesejahteraan Rakyat (Scheme for the
Development of the People's Well-Being).
66. A key approach to eradicate poverty and improve
the quality of life of the population is education. In
addition, the provision of health services and other
social amenities will also contribute towards reducing
poverty and enhancing the quality of life. The coverage
of amenities such as electricity, safe water and
transportation and communications will be further
widened to reach remote and outlying areas,
particularly in Sabah and Sarawak.
67. The rural development programme will focus on
enabling the poor to diversify their employment
potentials and sources of income. Rural income will be
enhanced through the implementation of integrated,
modern mixed crop commercial farming, as well as the
more systematic production of handicraft. The income-
generating activities, particularly among padi farmers,
rubber smallholders, fishermen and estate workers, will
be enhanced since the incidence of poverty among them
is high. Agriculture will be diversified to reduce over
dependence on a particular mono crop.
68. The Government is committed towards building a
caring society. In this regard, the welfare and quality
of life of the elderly and the disabled are taken into
account while pursuing our national development goals.
EQUITY RESTRUCTURING
69. With regard to the restructuring of society,
efforts will be made to increase the equity ownership
of Bumiputera in business. The Bumiputera currently
owned only 19.1 per cent of corporate equity. The
target is to raise their share to at least 30 per cent
by 2010. In ensuring non-Bumiputera equity ownership,
the share of ownership by the Indian community will be
given due consideration.
70. As Bumiputera companies have already made inroads
into the construction, transportation and agricultural
sectors, there is a need for them to diversify into
other high value-added activities, particularly in the
manufacturing, services and distributive trade. An
enabling environment will be created, including the
provision of incentives and financing, to assist
Bumiputera acquisition of appropriate technology as
well as management expertise. In addition, the
privatisation programme will continue to be implemented
to create more opportunities for Bumiputera
entrepreneurs at the corporate level.
DEVELOPMENT OF THE BCIC
71. The programmes to develop the Bumiputera
Commercial and Industrial Community (BCIC) will focus
on building more sustainable, self-reliant and world-
class Bumiputera entrepreneurs capable of competing
effectively both in the domestic and international
business. There is a need for Bumiputera entrepreneurs
to develop positive values and the ethics of business
for them to be continuously successful and self-
reliant. To develop more Bumiputera entrepreneurs, the
existing vendor and franchise development programmes
will be further strengthened and expanded.
72. The Government will also enhance Bumiputera
participation in the retail trade sub-sector through
the Bumiputera Retail Trade Development Project or
PROSPER. This project will be target-specific and
provide assistance and support services, such as the
provision of premises and capital, identification of
business opportunities as well as training in
accounting and cash management. It is hoped that
PROSPER will succeed in increasing the presence of
Bumiputera in new growth centres.
EMPLOYMENT RESTRUCTURING
73. Under the National Vision Policy, the Government
will formulate appropriate mechanisms to increase the
participation of Bumiputera in modern sectors and
ensure that the employment pattern largely reflects the
ethnic composition of the population. The capacity of
the Government's higher education institutions will be
expanded to increase accessibility, especially to
Bumiputera to balance the increase in private
educational institutions. Both the public and private
institutions of higher learning will be required to
increase the number of Bumiputera graduates and ensure
that the courses offered meet market demand.
TOWARDS BALANCED REGIONAL DEVELOPMENT
74. All the states in the country registered
improvements in the quality of life arising from
improvements in per capita income as well as access to
better infrastructure, social services and basic
amenities. During the OPP3 period, the thrust of the
regional development policy will be to accelerate the
development of the less developed states and reduce the
socio-economic imbalances among regions. Among the
measures that will be taken are promoting the
concentration of economic activities by state on the
basis of their comparative strength, continuing the
industrial dispersal programme, and further improving
infrastructure and the access to quality basic
amenities in the less developed states.
DEVELOPING A KNOWLEDGE-BASED ECONOMY
75. The development of a knowledge-based economy is
extremely crucial for the country to sustain rapid
economic growth and enhance international
competitiveness. We will need to strengthen our
capability to innovate and create indigenous technology
as well as develop and market new products. By
increasing the knowledge input, we will be able to
change from an input-driven strategy to a productivity-
driven growth strategy.
76. The knowledge-based economy does not mean
abandoning our existing production activities in favour
of high-tech activities exclusively. Of course,
productive activities in agriculture, manufacturing,
and services will continue, only that these activities
will have greater knowledge inputs in order to yield
much higher returns. As a result, the productivity and
value added of existing activities will be raised and
new investment opportunities in knowledge-intensive
industries will be opened up.
77. Malaysia started to lay the foundation for the
knowledge-based economy in the mid-1990s, with the
setting up of the National I.T. Agenda (NITA) and the
Multimedia Super Corridor (MSC). The MSC provides an
ideal I.T. and multimedia environment to attract
knowledge workers, technopreneurs, and multimedia and
high technology industries. The MSC area has attracted
a sizeable number of sophisticated businesses, world-
class technology-led companies and R&D investments.
78. During the OPP3 period, Malaysia will focus on
strengthening the critical elements that support the
development of the knowledge-based economy. Among the
most important element is building up the critical mass
of knowledge manpower quickly and effectively.
79. For the successful implementation of the
knowledge-based economy, the brain gain programme will
be accelerated to attract Malaysian expertise and
talents from overseas as well as foreigners with the
requisite skills to meet our immediate and short-term
needs. The registry of Malaysian R&D scientists and
engineers working overseas will be expanded to include
new expertise and technopreneurs in other knowledge-
related disciplines.
80. To provide the appropriate environment, the
Government will maintain a stable macroeconomic
environment, make available the basic infrastructural
facilities, and create a conducive regulatory
framework. Efforts in developing S&T and R&D will be
more focused and directed towards areas that are
strategic in developing the knowledge-based economy. We
will endeavour to develop more local technopreneurs who
will eventually be able to market their products in the
global market. In this regard, financing for new
ventures will be strengthened. To develop the venture
capital market and local expertise, the inflow of
foreign venture capital funds will be encouraged to
come in and the management of Government venture
capital funds will be outsourced to reputable venture
capital corporations, including foreigners.
81. The successful development of the knowledge-based
economy will require the participation of various
parties, not just Government initiative. In this
respect, the role of the private sector is crucial in
acting as the engine of growth. Businesses must take a
broader view of opportunities since markets have become
virtual and borderless. Even small businesses and
cottage industries should enhance the quality and value
of their products by using better production techniques
and equipment, improving their design and packaging,
and using e-trading and e-business tools to source
components and widen their markets.
82. The Government realises that the development of
the knowledge-based economy has the potential of
increasing the digital divide among high and low income
groups and the rural and urban population. Accordingly,
steps will be taken to reduce the knowledge gap and the
digital divide within the country. The strategies
include promoting greater awareness and participation
of the low-income groups and those cut off from growth
centres in the knowledge-based economy and providing
education and training in ICT to them.
Telecommunications infrastructure will be expanded
throughout the country to ensure that rural areas and
disadvantaged groups have better connectivity and
access to ICT. Local communities will be given ICT
facilities, which could be used as one-stop centres for
information on Government services, teleworking and
distance learning. In addition, there will be better
provision of ICT infrastructure and services, as well
as access to lifelong learning opportunities for people
in rural areas.
INVESTING IN PEOPLE
83. As Malaysia enters the 21st century, human
resource development will be absolutely crucial to
support the development of a knowledge-based economy
and to ensure that all Malaysians will be able to enjoy
the nation's prosperity. The thrust of human resource
development is to prepare a workforce that is capable
of meeting the challenges of a knowledge-based economy,
well equipped with technological skills and expertise,
and high level of thinking skills. Accordingly, we are
investing a substantial amount of resources in
education and training.
84. The education and training system will be
reoriented so that knowledge, skills and expertise
acquired by Malaysians will effectively support the
development of the knowledge-based society.
85. As the growth and development of the economy will
be driven by knowledge-based industries, new economic
activities will be generated in all sectors, especially
in the manufacturing and services sectors. The demand
pattern for manpower will change towards high
technology and science-based industries, biotechnology,
ICT, pharmaceutical and R&D activities, all of which
require workers with tertiary education in the science
and technology related disciplines. The sophistication
in the production processes will generate demand for
137,200 engineers and 331,700 engineering assistants
trained in the electrical and electronics, chemical,
biotechnology, mechanical, ICT and other technologies.
In agriculture, the introduction of high technology
cultivation methods and industrial practices, large-
scale and mixed farming and increased mechanisation
will require a substantial number of trained labour in
various disciplines, as well as those skilled in agro-
business, modern integrated farm management, and
biotechnologists.
86. The Government is promoting lifelong learning and
providing facilities so that the public can
continuously update their knowledge, upgrade their
skill base, even after leaving the formal education and
training system. For this purpose community colleges
will be established. Our labour force will be
continuously retrained and upgraded, while preparing
them with the new skills needed by the knowledge-based
economy.
CONCLUSION
87. The country has indeed done very well along many
fronts during the last decade. We have witnessed how
Malaysians have used their creative energies and
ambition to push further the achievements of the
country, and have moved into areas that normally fall
within the domain of developed countries.
88. The success of the NVP requires total commitment
from us all, and everyone should be prepared to work
hard to achieve the target. We must be prepared to
reinvent ourselves, to change our mindsets, to be
innovative, resourceful and disciplined, as well as to
have a sense of urgency in the face of increasing
challenges.
89. The Government will continue to be responsive and
adopt appropriate policies and incentives that are
business-friendly and market-oriented. We will ensure
that the Government machinery at all levels will work
efficiently, without deviating from original
objectives.
90. As Malaysians, we must not only become more
competent and be equipped with new and better skills,
we must also ensure that foreign values and practices
do not erode our national identity and heritage. We
will need to develop strong values and work ethics and
cultivate a caring and competitive society. All foreign
influences that are negative must be resisted to
maintain our national identity, which is infused with
traditional eastern culture.
91. By the will of Allah and His Blessings, we will
continue to prosper and achieve the goals we have set
for ourselves in the first decade of the 21st century
and in doing so, we will come closer to the attainment
of Vision 2020.
92. I beg to move.
Sumber : Pejabat Perdana Menteri
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