Malaysia 2020 Essay

Wawasan 2020: A Vision Impossible?

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Published on Tuesday, 11 February 2014 09:00

YEARS pass by and without us realising it we are shy of six years before year 2020 arrives. But what is so significant about this year you may ask? For any Malaysians, when the year is mentioned, Vision 2020 (also known as Wawasan 2020) will immediately come to mind.


Shaped three decades ago by the then Prime Minister, Tun Dr. Mahathir Mohamad, Vision 2020 outlined Malaysia's goals in becoming a fully developed nation. Since its inception, every move the country makes is aimed at achieving this ‘Malaysian dream’.

But have you ever wondered where we are with it now?

The Vision

Vision 2020 is not only a mission for Malaysia to advance economically, but also for the nation to achieve an ideal social and political environment. Apart from that, it emphasises on the betterment of governmental system, life quality, social and spiritual values, national pride as well as confidence.

To refresh our memory, here are the nine key challenges in Vision 2020:


Challenge 1: Establishing a united Malaysian nation made up of one Bangsa Malaysia.

Challenge 2: Creating a psychologically liberated, secure and developed Malaysian society.  

Challenge 3: Fostering and developing a mature democratic society.

Challenge 4: Establishing a fully moral and ethical society.

Challenge 5: Establishing a matured liberal and tolerant society

Challenge 6: Establishing a scientific and progressive society.

Challenge 7: Establishing a fully caring society.

Challenge 8: Ensuring an economically just society, in which there is a fair and equitable  distribution of the wealth of  the nation.

Challenge 9: Establishing a prosperous society with an economy that is fully competitive, dynamic, robust and resilient.

 
Economically Challenged

Strangely enough, the architect of the plan, Mahathir, has in the past expressed doubts on Malaysia's ability to achieve economic goals of Vision 2020.

In 2010 at the Perdana Leadership Foundation's CEO Forum, he pointed out the economic crises that hit the nation in 1997/97 and 2008 was a major setback and halted our progress in achieving Vision 2020.

The former Prime Minister then advised the government to focus on stimulating Domestic Direct Investments (DDI) instead of courting Foreign Direct Investments (FDI). He acknowledged FDI has helped the country grow in the 80s and 90s, but argued that the situation has now changed.

In recent days, it is difficult for Malaysia to compete with the significantly lower costs countries such as Vietnam and China have to offer.

Mahathir reiterated the emphasis on FDI during that period (80s and 90s) played a major part on why we aren't progressing as much as we would have liked today. We at that time offered labour and resources at a much low cost, and this turned Malaysia into a country that specialises in labour-intensive activities.

Overtime, this had caused other countries that are focusing on innovation to out-leap us with technological prowess and their cutting-edge financial sectors.

The Middle Income Trap

According to a report by the World Bank last year, our dependence on low wage labour input has also put us in a 'middle income trap'. This means, our country can no longer offer low cost labour compared to other countries, nor can we compete against countries with rapid technological advances.


In a 2011 research by the University of Massachusetts-Dartmouth titled Mapping the Global Digital Divide, a map showing the spread of computer and communications technology around the world was created. In the study, it listed Malaysia as one of the 'emerging market economies' along with 24 other countries among which are Vietnam, Indonesia, Hungary, and South Africa. The study explained that emerging market economies are growing nations that fall between the extremes.

Catching Up On Technological Advancement

In the same research, the 25 nations in the 'emerging market economies' were found to be lagging in terms of computer and Internet use compared to developed countries such as the United States.  It also reported that these nations have yet to fully utilize the Web's potential.

Perhaps, what’s even more alarming is the revelation made in a recent report by www.techbiggy.com which ranked Malaysia as one of the top 10 countries in the world with the slowest internet speed.

Efforts to overcome this problem however are in motion through the National Broadband Initiative formed by the government, a project that cost RM1 Billion.

In other sectors such as agriculture, it seems that we are still relying heavily on technology transfer (technology adopted from overseas) instead of nurturing homegrown technology.

Could the lack of innovation be a result of our education system?

A survey called Programme for International Student Assessments done last December places Malaysia at 52nd position out of 65 countries (behind Vietnam) in math, science and reading abilities of students.

In addressing the issue, the government introduced the Malaysian Education Blueprint 2013-2025, which was launched in Sept last year. One of the aims in the plan is to encourage young talents to innovate.

Professor Datuk Dr. Mohammad Agus YusoffThe social scene

On non-economic goals, renowned political analyst, Professor Datuk Dr. Mohammad Agus Yusoff thinks Malaysia still needs to work harder to achieve Vision 2020’s target.

“Socially, we are still polarized in many aspects. And that is the harsh reality for us to face,” said Agus.

“No one can deny that currently we are a nation that is politically, racially, and religiously divided. While it is true that the government has made efforts for 'Bangsa Malaysia' by coming up with the 1Malaysia concept, it strayed far from the vision’s initial objective.

“Instead of focusing on uniting the people, it has transformed into an array of products such as 'Klinik 1Malaysia', 'Kedai 1Malaysia', 'Baucer Buku 1Malaysia',” Agus said about the commercialising the 1Malaysia brand.

Mahathir too, is pessimistic in achieving unity through the introduction of Bangsa Malaysia. In 1991, he had envisioned an economic progress and general prosperity that could overcome communal-centric mindsets.

He also explained that the current disharmony the nation is facing can be attributed partly to Malaysia's modest economic progress and also to the fact that the government is not as 'strong' as it used to be.

To him, this has led to the current regime to be easily taken advantage of and pressured by communal-centric groups.

For some, Mahathir is seen as someone who was able to keep racial issues under control (or rather under the blanket) during his tenure as Prime Minister. He is also viewed as a Prime Minister who didn’t give everyone equal slices of the cake, but he made the cake bigger instead for everyone to enjoy ‘accordingly’.

Agus pointed out that in a truly developed country, the social divide is kept at bare minimum.

“But sadly that isn't the case for us. There still is a vast divide between the rich and poor, a significant divide between urban and rural areas of the country, and most importantly, a hefty divide between the leaders and the civilians.

“We also face issues such as restrictions on human rights and media freedom, while large sections of the public have little faith and question the integrity of government agencies. These issues need to be seriously addressed and be given full commitment by the nation's leaders,” he said.

Agus believes that even if Malaysia fails to achieve Vision 2020, it will not be the end of the world.

“In fact, there are other government plans such as the New Economic Policy (NEP) that has also failed to meet its target,” he added.

But he stressed out the importance of keeping the momentum going in transforming the country into a fully developed country.



In November last year, the Minister in the Prime Minister's Department, Datuk Seri Abdul Wahid Omar announced that 'Malaysia is on track to achieve Vision 2020'. His statement was made during his trip to New York for the Invest Malaysia USA 2013 roadshow.

But with a report by Wall Street Journal last month indicating that investors are shying away from the Malaysian markets, plus the never-ending social tensions across the country, doubts seem to be taking place and many seem to disagree with the minister's view.

With the curtain almost closing, it seems that there’s still a lot of work needs to be done for Vision 2020.

But stay hopeful Malaysians. We still have that six years left. And even if we fail, we can always create another vision for year 2050.

 

-mD

Author: Gregore Lopez, ANU

On November 9, Mr. Najib Razak, Malaysia’s Prime Minister and Finance Minister, announced at the Multimedia Super Corridor implementation council meeting that Malaysia was aiming for an average annual GDP grow rate of nine per cent until 2020. Realising later that the numbers were absurd, the government went into damage control mode.

Immediately, the local media edited the premier’s statement to six per cent. The next day, the Minister in the Prime Minister’s Department, in charge of the Economic Planning Unit, the government’s powerful pinnacle agency on economic matters, noted that Malaysia was capable of achieving 5.4 per cent GDP growth rates annually over the next ten years to achieve the objective of becoming a high income economy by 2020. On November 11, in the Lower House (Dewan Rakyat), the Deputy Finance Minister stated that Malaysia is expected to recover from the current recession and was projected to grow at between two to three per cent in 2010. Such is the uncertainty of Malaysia’s economic future.

Malaysia’s economic performance has never averaged nine per cent over the course of a decade, even in the best of times, and has been on a downward trend since the East Asian Financial Crisis of 1997/98. Average growth was around 6.7 per cent in the 60s; 7.7 per cent in the 70s; 5.9 per cent in the 80s; 7.3 per cent in 90s and 5.2 per cent for the period 2000 – 2006 (Yusuf & Nabeshima, 2009). It is therefore unrealistic given the current global economic situation and, more importantly, Malaysia’s weakening economic fundamentals that it would achieve even five per cent GDP growth. The Economist Intelligence Unit (Sept 15, 2009) projects that Malaysia’s GDP is expected to grow at an annual average of 4.6 per cent in 2011-2020. The World Bank’s most recent assessment for Malaysia, which was more hopeful, notes that the Malaysian economy is projected to grow at 4.1 per cent in 2010. In the medium term (2011-2012) growth is projected at around six per cent conditional on the country undertaking structural reforms. Herein lies Malaysia’s challenge.

Since 1991, Vision 2020 – Mahathir’s vision to transform Malaysia into a developed economy – has been Malaysia’s long term objective. There is consensus that his target will not be met as the required structural reforms were not taken. Malaysia is still a highly protected economy – especially in the services and resources sectors with a perverse economic model that benefits a particular class of people within the ruling political party. This has severely curtailed efficiency and dampened economic growth.

Najib Razak was forced to introduce a new vision – to move Malaysia into the category of high income economies – to maintain political legitimacy for the ruling party.  To achieve this target, Malaysia would need to double its current per capita income of US$7, 990 to US$15, 000 by 2020. This would require restructuring the Malaysian economy; a job that would naturally impact on the Malaysian political and social situation. Najib himself has admitted that this is a Herculean task. This may explain why his administration has not been able to provide a policy document or a coherent argument on what the required structural adjustments are and how they will be implemented. Najib has so far made ad hoc announcements of liberalisation measures: some genuine, others smoke-screens and some even overturned in the face of political pressure.

Structural adjustments will involve the dislocation of certain groups, industries or sectors. The welfare of some people will definitely be affected. However, if the nation benefits as a whole, the groups that are dislocated will be compensated and the nation will be better off as a whole. This is the central problem in Najib’s efforts to secure its economic future by improving competitiveness through liberalisation – an inability to define the ‘national interest’. Over the years, the increasing strength of the United Malay National Organisation (UMNO) had defined the “national interest” as ensuring the welfare of the community aligned to the ruling party. They are predominantly but not exclusively Malay elites (UMNOputras) who have benefited tremendously from affirmative action policies. While the policy has been applauded in general for maintaining stability, it has clearly come at the expense of the nation overall.

For Malaysia to become a high income economy, the World Bank’s recommendations were that the Malaysian economy specialise further, improve workforce skills, make growth more inclusive, and bolster public finance. This obviously requires that ‘national interest’ be defined broadly – to include all Malaysians and reverse policies that benefit a select few. Therefore, Malaysia’s economic future ultimately lies in Najib’s ability to put the interest of Malaysians ahead of the supporters of his political party or for Malaysians to vote in an alternative Prime Minister who would do just that.

Gregore Lopez is currently pursuing a PhD in Economics at Australian National University and blogs at malaysiasdilemma.wordpress.com. He also volunteers as the Editor of the Malaysia section of New Mandala. 

This article was first published here, in New Mandela.

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