Business

Friday May 29, 2009

Economic advisory council coming up with new growth strateggies

By YAP LENG KUEN


PETALING JAYA: The new economic advisory council is expected to come up with new growth strategies to transform the economy and move up the value chain.

“Among the major agenda is likely to be the formulation of a high-income growth model,’’ Economic Planning Unit director-general Tan Sri Sulaiman Mahbob told StarBiz.

The Government is examining the mechanism and perspectives to achieve this, and World Bank experts have discussed with the EPU, private sector, Prime Minister Datuk Seri Najib Razak and the executive committee of the current economic council.

»Among the major agenda is likely to be the formulation of a high-income growth model« TAN SRI SULAIMAN MAHBOB

A “blue ocean’’ study has been completed on the potential sectors such as services, high technology, manufacturing and new agriculture that can drive economic growth higher.

Simplification of business procedures as well as significant improvement in wage levels and facilities may be looked into as part of efforts to bring back the skills, for instance, in finance and health, from abroad.

Income and growth redistribution may be another topic as inequality within and among ethnic groups need to be addressed within a context that is current and relevant.

In fact, the EPU has been entrusted with the study of the dynamics of inequility and distributive justice as an important component of the political economy.

The recent measures to further liberalise the financial services sector and lifting of the 30% bumiputra quota on 27 service sub-sectors are seen as right moves towards that direction.

“I see the economic council as a ‘brains trust’ to assist the government in managing the economy through the global economic crisis and planning the transformation of the nation’s economic growth model for the long term,’’ said Datuk Seri Nazir Razak, chief executive of CIMB group.

“They need to make new strategic changes based on lessons learned from the ongoing financial crisis,’’ said economist Datuk Dr Zainal Aznam Mohd Yusof.

“Crisis will always be there ... it is a part of the capitalist system. We have to build that into our model as 10 years down the year, we may be hit by another crisis.

“Therefore, the new model may have slow growth for some years. We have to be more realisitic and critical about it.’’

Economic watchers cautioned against repackaging of old ideas and said more insights were needed on what exactly would be the focus, going forward, as Malaysia attempts to insulate herself from external shocks while at the same time, remain an open, trading economy.

Many said it was a good idea to trim the size of the economic council to 8-12 members from the 40 in the current council. “They should announce the details soon,’’ said an economist, adding that terms such as “creativity,’’ and “value-added’’ required concrete milestones and time frames.

It is understood that the current structure of the economic council, that comprises working and focus groups, would be restructured with a group of advisers headed by the EPU to support the core members.

Najib had announced the appointment of Tan Sri Amirsham Abdul Aziz, former Minister in the Prime Minister’s department, as chairman of the economic advisory council which will comprise high powered members with knowledge and experience in their fields. One name that has cropped up is Datuk Seri Panglima Andrew L.T. Sheng.


For Bank Negara statements click here

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