The Economic Minister in discussing on the next Malaysia Plan or RMK-13 said for the next five years, the govermment is envisioning what Malaysia will look like in 2040? Adding, that taking this high-vantage approach forces the government to think beyond individual policies but instead to determine what will drive the next generation of Malaysia’s economy.
Calling it the thrid pivot, Minister Rafizi Ramli said diversification is critical, and that Malaysia must become a consumption powerhouse, an economy that is primarily driven by its people will be the most important determinant of a long-term trajectory and growth rate.
“By boosting domestic demand, we kickstart a virtuous economic cycle. Higher private consumption creates more jobs across all sectors in retail, services, and manufacturing. This translates to lower unemployment andhigher disposable income. This increase in savings helps to localise investments into better public infrastructure such as healthcare and education” said Rafizi.
However, the Minister also noted that placing this enhanced focus on consumption will not come at the expense of the country’s export-oriented economy. It’s about recognising the current imbalance between the two drivers, and creating urgency to close the gap. Marrying a traditionally trading-based economy with greater consumption diversifies growth and mitigates risks.
To materialise this pivot, the government said it has to take a different approach to the 5-year plans. Over time, successive policy documents have grown in length and complexity, making it difficult for ordinary people to read.
In this sense, Razizi said the RMK-13 will be more similar to RMK-1. A strategic document that is equally concise and comprehensive. Each word must be committed towards a specific policy direction. Anyone who has written a concise essay,
let alone a 5-year plan, knows this is no easy task
The other challenge is a commitment to radical reform. The planning phase of RMK-13 is akin to a blank canvas he said, and wants to gather creative ideas and inputs from as many people as possible. To create a status-quo-free space to voice concerns and nudge the government in the right direction.
An early example was the approach to labour market reform. Before jumping into creating higher value jobs, or focussing on unemployment, Rafizi said the government knew the most pressing issue was stagnating wages. The rollout of the Progressive Wage Policy tackles this with an incentive and productivity-linked mechanism.
By solving this node first, policy discussions on TVET or gig economy are suddenly productive. “You are less likely to derail discussions with low wages, and can focus on the specific issue of the day. By framing RMK-13 in this sequencing manner, the government will be more efficient in allocating its resources.” he noted.
The Minister further added “The breadth of this exercise affects every facet of Malaysia: from SME transformation to an ageing population. It should be an inclusive process that takes the time to listen to anyone who has a stake in Malaysia’s future.”
To this effect, the Economic Ministry will organise a series of engagement sessions and focus groups in all 13 states across Malaysia to gather feedbacks from public thinkers, private players, and everyday people.
Rafizi concluded the succes of RMK-13, and Malaysia’s potential to be a consumption powerhouse, does not depend on the government. It requires a whole-of-nation approach where we are each invested in our country’s future.
