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TABLING the 11th Malaysia Plan in parliament on Thursday, Prime Minister Najib Razak sought to assure Malaysians they would be at the heart of initiatives under the country's development plan for 2016 to 2020, which would count as the "last lap" towards the country achieving developed nation status by 2020.
Even as the country is hit by a weak ringgit and falling global oil prices have shrunken its revenue, he spoke of "bold measures for the long-term benefit of all Malaysians" in the RM260 billion (S$96 billion) economic plan.
Even so, there was not a lot new that had not been bandied about previously, including "social inclusion and a united Bangsa Malaysia".
There appeared to be no mention of the 2010 New Economic Model (NEM) aimed at stemming the brain drain and at attracting a better grade of investments through political and economic reforms based on greater meritocracy.
Indeed, so many of the NEM initiatives have been watered down or cast aside after severe criticism by right-wing bumiputera groups bent on maintaining the status quo that it is unclear whether it is still being pursued.
Bumiputeras now comprise 68 per cent of the 30 million population, up from 62 per cent 25 years ago; they form the bulk of the poorest or bottom 40 per cent (B40), even after more than four decades of affirmative action.
Mr Najib, who is also finance minister, said the 6 per cent Goods and Services Tax (GST) introduced in April is expected to yield RM31 billion in average annual revenue, which would be channelled back to the people, particularly the B40; the aim is to double the average monthly B40 household income to RM5,000 or more.
Macroeconomic targets include achieving 5 per cent to 6 per cent gross domestic product (GDP) growth per annum and increasing labour productivity and better paying jobs by 2020 - by which time the government hopes to be able to balance the budget.
Another target under the 11th plan is to expand the middle class to 45 per cent, up from the current 40 per cent.
Of the RM260 billion budget, half - 16 per cent more than under the 10th plan - will go towards infrastructure projects such as developing faster broadband, hospitals and the KL-Singapore high-speed rail.
The balance will be set aside for "soft infrastructure" such as education and vocational training.
Already, tens of billions of ringgit have been poured into education over the years to little effect: employers still complain that graduates lack employable skills, and students are faring poorly in international tests.
RHB Investment Bank senior economist Peck Boon Soon noted that more than 90 per cent of the government's projected RM1.4 trillion revenue over the five-year period would be spent on operating expenditure - far from the ideal of about 75 per cent. Malaysia's public sector has swelled to 1.5 million strong on the back of Putrajaya's recruitment to provide graduates with employment.
Mr Peck also noted that the declining strength of exports as an engine of growth was not addressed. Instead, Putrajaya continues to bank on domestic demand and consumption to grow the economy, despite the obvious limitations of doing so, given the high household debt of 86 per cent of GDP, and government debt of about 55 per cent of the GDP.
Malaysia has run a budget deficit since 1998. Its fiscal deficit, which has been gradually coming down, stood at 3.5 per cent of GDP last year.
Total exports account for 76 per cent of GDP - but export growth has been slipping over the past 25 years. From a 16 per cent expansion set for the 6th Malaysia Plan, growth in exports tumbled to 2.5 per cent for the 9th plan and 2.1 per cent for the 10th.
Mr Peck said: "We have not nurtured enough companies to compete in exports, but have been relying mainly on FDIs (foreign direct investments). As we are losing export competitiveness because business costs are rising; foreign investors will move to cheaper locations. At the same time, our domestic investors have also been moving away and investing overseas."
Given the slower pace of exports and the restraints to domestic consumption growth, achieving the GDP targets will be challenging, particularly since oil prices have slumped, he added, noting that Malaysia had failed to hit the 6 per cent average growth targeted under the 10th plan.