January 28, 2010
KUALA LUMPUR, Jan 28 (Bernama) — The government and the rakyat need to put in a tremendous effort for Malaysia to record eight per cent growth annually in order to achieve a developed nation status by 2020.

In the Government Transformation Programme (GTP) Roadmap released here Thursday, it said there were challenges for Malaysian economy to grow by eight per cent per year until 2020 as the growth has slowed after the Asian economic crisis in 1997.

Malaysia’s growth rate has almost halved since the crisis, down from an average of about nine per cent per annum in 1991-1997 to an average of 5.5 per cent per annum in 2000-2008.

“Many factors have contributed to our slow growth. Among others, Malaysia is being supplanted as a low-cost export and services base by emerging economies such as India, Vietnam and China,” the Roadmap said.

The GTP Roadmap was launched by Prime Minister Datuk Seri Najib Tun Razak here Thursday.

The compound annual growth rate of foreign direct investment into Malaysia from 2000 to 2007 was only one per cent, compared to 30 per cent for India, 12 per cent for Vietnam and 10 per cent for China.

According to the Roadmap, there was also an urgent need for the government to reduce spending as the country was in a fiscally-challenging position.

It said Malaysia’s ability to finance improvements in its performance was limited, given that the country’s fiscal position has been worsening since 1997.

“We face a dilemma. There is an urgent need to reduce spending and yet deliver big economic and social outcomes fast.

“Consequently, we will have to prioritise allocation of funds to the most important areas, enhance productivity and efficiency through new ways of delivery and roll back subsidies and any other distortions in the economy, albeit gradually,” it said.

Meanwhile, Malaysia also needs to improve its performance on social measures as the country’s performance on some key social measures does not bode well for it to achieve the social goals encapsulated in Vision 2020.

Public safety has become worse in recent years with index crimes such as property theft and violent crimes increased.

The perception of corrupt practices has risen in recent years, evidenced by Malaysia’s declining ranking in Transparency International’s Corruption Perception.

In 2009, Malaysia’s ranked dropped nine places to 56 from 47.

In terms of education, there are indications that Malaysia may have fallen behind on wider student outcomes.

The 2007 Trends in International Mathematics and Science Study saw 20 per cent of Malaysian students failing to meet the minimum benchmark.

(Source: Bernama)