As Malaysia turns 63 years old, the country will need to continue its transformation in becoming a knowledge-based economy to achieve its status as a developed nation, says Chris Wang.
Wang, CEO of the Asia Pacific Investment Bank (APIB) says Malaysia’s economic development has been stable as compared to its Southeast Asian peers, but it faces several constraints in breaking through the middle-income trap and become an advanced country.
For instance, Malaysia does not have a large consumer base such as the US, China and Japan to help propel the country to become an advanced nation.
“There has always been only one option for a small country like Malaysia to achieve such a goal, which is to develop a knowledge-based economy that possesses advanced knowledge, instead of relying only natural resources, that is unique and valuable.
“Education, research and development are the main sectors of a knowledge-based economy. Talent and human resources are the most important assets,” he adds.
Wang says the key driver behind a knowledge-based economy is an open financial market that could help the country attract talents, encourage development and innovation.
“Malaysia’s knowledge-based economy must rely on an open financial market to release its full potential. This can be done through continuous development and further opening of Malaysia’s Islamic finance.
“It is vital for Malaysia to open up its Islamic financial market further to attract talents and encourage technological advancement. It will benefit the service and manufacturing industries of the country,” he says.
Wang lauded Malaysian’s government strategic planning for the country’s economy. And he says APIB wants to help the country to open up its Islamic finance industry further.
“The objectives of Malaysia’s economic planning are clear. But it can be adjusted, especially in terms of its Islamic finance and capital market openness. For instance, the country should give full support to foreign Islamic entities including financial companies to enter its capital market. We believe this will allow more high technology businesses and innovative companies to set up their bases here,” he says.
He adds that many foreign enterprises from China and other countries are looking for cross-border investment and opportunities to enter the Islamic market. And Malaysia is in a good position to attract these companies and bring their advanced science and technological knowledge and capital into the country.
“As countries and businesses globally are embracing the Industry 4.0 trend, the existence of high-tech enterprises will support such a transformation process,” he adds.
Meanwhile, Wang says the world will witness drastic changes in the international order in the third decade of the 21st century. Malaysia’s leading position among ASEAN countries and how it continues to enhance itself as a global Islamic financial centre are keys to the country’s further progression.
“We are standing at a turning point in the development of the Islamic finance industry. And what the industry players need now is the courage to speak our minds and voice our demands for the Islamic industry to open up further. When this happens, it will attractive worldwide attention.
“APIB will work with the Malaysian government, financial institutions, local and foreign enterprises to help the country move towards a better future,” says Wang.