TO promote a balanced development among states, efforts were taken to diversify the economic base, develop knowledge-based activities and provide a better social infrastructure, particularly for less developed states.
Using the development composite index, in terms of economic and social development criteria, the various states were classified into less developed and more developed states.
During the review period, among the more developed states were Kuala Lumpur and Malacca where they were found to have a higher level of economic activity, income and quality of life.
The economic slowdown during the review period affected the overall gross domestic product (GDP) of more developed states, which recorded an average rate of 3% per annum, which was the same as the national average.
Selangor, Penang and Johor exceeded the 3% average due to increased in contribution from the manufacturing and services sectors.
The less developed states recorded an average GDP growth of 2.9% per annum, while Sarawak, Terengganu and Pahang registered a higher growth compared to the national average as a result of contributions from the agriculture, mining and manufacturing sectors of the respective states.
In terms of per capita GDP, the national average annual per capita GDP grew by 1.8% during review period to RM15,382.
The average per capita GDP of the more developed states increased by 1.6% per annum from RM17,667 in 2000 to RM18,534 in 2003, with Kuala Lumpur recording the highest per capita GDP at RM30,578.
For the less developed states, the average per capita GDP increased by 1.6% per annum from RM11,401 in 2000 to RM11,964 in 2003, with Terengganu recording the highest per capita GDP of RM24,121.
The average per capita of most of the less developed states reached the target of attaining at least two-thirds of the national average.
For the rest of the Eighth Malaysia Plan period, economic growth in all states is expected to remain high with the more developed states projected to grow at an average rate of 6.1% per annum.
The less developed states are expected to grow at an average rate of 5.7% per annum.
To accelerate the development of all states and reduce the socio-economic imbalances among the states, economic activities would be promoted on the basis of comparative strength of the states, the industrial dispersal programme, further improvement of infrastructure and better access to quality public amenities.
The development of less developed states would be further intensified through diversification into manufacturing and selected services activities, including modernising the rural areas and increasing accessibility to information and communication technology (ICT) facilities.
New and potential areas of growth would be identified and promoted for all states based on advantage of location and socio-economic considerations, and concerted efforts would be taken to ensure that less developed states are able to generate faster growth.