THE development of the New Economic Model (NEM) will be guided by three principles – high income, sustainability and inclusiveness – to drive the country’s economic progress to become a developed nation.
Prime Minister Datuk Seri Najib Tun Razak said creating a high income nation would mean higher wages throughout the economy as growth was derived not only from capital but also from greater productivity through the use of skills and innovation, improved coordination, stronger branding and compliance with international standards and Intellectual Property Rights.
“We should ask ourselves this fundamental question – will the NEM create high income jobs where the rakyat benefits from a competitive economy and a better way of life?” he said.
Growth model: Malaysian Industrial Development Authority staffers going through the report on the New Economic Model at the Invest Malaysia
2010 conference in Kuala Lumpur yesterday. The framework on NEM was made public during the conference which was opened by Prime Minister Datuk
Seri Najib Tun Razak. — MOHD SAHAR MISNI / The Star
Najib said the Government wanted to see a Malaysia that would make a quantum leap from the current US$7,000 (RM23,100) per capita annual income to US$15,000 (RM49,500) in 10 years.
“The New Economic Model must be built from here,” he said when unveiling the NEM’s framework at Bursa Malaysia’s Invest Malaysia 2010 conference yesterday.
Najib said the NEM must also include a commitment to sustainability, not only in the country’s economic activities but also in the impact of economic development on the country’s environment and precious natural resources.
“There is little value in pursuing a future based entirely on wealth creation, pursuing growth that depletes resources and displaces communities (which) will have dire consequences for future generations.
“This is a false and futile choice.
“High and sustained growth and environmental stewardship can and must go hand-in-hand,” he said.
Najib said inclusiveness – the third principle – was a key prerequisite for fostering a sense of belonging and engagement in the NEM.
He said an inclusive NEM would ensure that no one was left out in contributing to and sharing in the creation of wealth as the country progressed.
“While perfect equality is in reality impossible to achieve in an open, global economy, an inclusive society will ensure that we can narrow inequalities in our nation, help those who need help most and engage all of Malaysia’s talents in our effort to build a competitive economic workforce,” he said.
Najib said to fully meet these new challenges, a change in the national mindset would be required.
“In the short-term, there will be entrenched opposition. But for the long-term strength of our nation, we cannot afford to duck these issues any longer. If we are to truly tackle inequality and become a beacon of progress in our region, we must bring a sense of urgency to reform,” he added.
To achieve this transformation, Najib said the following eight strategic reform initiatives would be focused on:
> Re-energising the private sector to lead growth;
> Developing a quality workforce and reducing dependency on foreign labour;
> Creating a competitive domestic economy;
> Strengthening the public sector;
> Putting in place transparent and market-friendly affirmative action;
> Building knowledge based infrastructure;
> Enhancing the sources of growth; and
> Ensuring sustainability of growth.