Malaysian Prime Minister Najib Razak has defended his
ability to push through transformative reforms despite
concerns locally that they could cost him his job.
In an exclusive interview with Emerging Markets,
Najib said: I feel strongly that my government has the
necessary support to push our reform initiatives
He added that Malaysians would demand reform. They
desire a massive transformation, he said.
In March Najib launched an ambitious programme, the New
Economic Model, which seeks to make Malaysia a high-income
economy with developed nation status by 2020 implying
that national per income capital will be more than doubled to
$15,000/year by that time.
Significantly, Najib plans to end many affirmative action
policies originally implemented by his father, Tun Abdul
Razak, when prime minister in 1971 such as a requirement
that 30% of equity in new share offerings must be allocated to
Bumiputras, or ethnic Malays.
The reforms which many feel have been prompted by
Malaysias opposition coalition, led by Anwar Ibrahim,
winning an unprecedented one third of the seats in parliament
in the 2008 general election have been widely welcomed
by international analysts.
But some feel that established interests in Malaysia will
try to push Najib out of office rather than allow such change.
People who have had their snouts in the trough for such a
long while are not going to take it lying down, said an
analyst in Kuala Lumpur.
Najib told Emerging Markets: I agree this is no easy
task. But Malaysias future prosperity depends
on our ability to create an environment conducive to innovation
and investment. The NEM ... depends on our ability to provide
equitable treatment for all businesses, ethnic communities and
groups. He said the NEM will be based on needs and
merit, and not simply race.
Najib is attempting to effect change without losing the
vital support of the Malay majority, and stressed: We are
not dismantling any type of support for the Bumiputera, who are
often those who need it the most.
But he offered an unusually stark suggestion that policies
have previously enriched a few and not served the majority,
saying he must make sure that government support will not
get wasted in rent-seeking and patronage behaviours by a few
Specific measures include the launch of a Government
Transformation Programme which will involve improving
government efficiency, an immediate crackdown on street crime,
tackling corruption and a complete eradication of hardcover
poverty by the end of 2010.
Najib added: We know that the era of government
knows best is over.
In one measure sure to divide opinion, the NEM will reduce
subsidies, including oil. Malaysia is one of the most
subsidized nations. We know that this is not a responsible
Other measures include childhood literacy improvements,
welfare reform, and smaller government with greater partnership
with the private sector.
Malaysian society has been uncommonly tense this year, with
attacks on Hindu temples, and international concern being
expressed about a second sodomy trial for opposition leader
Anwar, who was imprisoned for six years on a similar charge
that was subsequently overturned in 2004.
Najib said Anwar deserves to have a fair and impartial
trial independent of the government and added: The
government views this trial as a distraction from its important
work of modernization and reform.
Anwar has said the NEM takes the ideas of the Malaysian
Economic Agenda his coalition launched in 2006 but fails to
deliver them properly. Specifically, he claims the new policy
does not reform public institutions and the judiciary, offers
little to combat corruption, and introduces privatization
initiatives that will merely allow the government to raise
funds for its next general election campaign.