Second Malaysia Plan
The Second Malaysia Plan (
Background
Although the Malays have nearly always comprised a majority of the Malaysian population, their economic power has rarely been commensurate. In 1970, the
However, the
The Second Malayan Five Year Plan (1961–1965) was an economic development plan launched by the government of
While it held the reins of power, the NOC set out the NEP, with the ultimate aim of eradicating poverty and eliminating "the identification of race with economic function" through a "rapidly expanding economy"; the NEP aimed for a Bumiputra share of 30% of the economy within 20 years.[7] The Outline Perspective Plan was also approved, with similar goals to the NEP. Both the NEP and the Outline Perspective Plan were set to expire in 1990, and the Second Malaysia Plan was passed by Parliament to implement the goals of these policies.[8]
Economic restructuring
The Second Malaysia Plan stepped up government involvement in the economy, with the main goal of increasing Malay economic interests, especially in the areas of manufacturing and mining.[9] To avoid directly hurting Chinese economic interests, the plan focused on huge economic growth, with the goal of expanding both the Malay and non-Malay shares of the economy in absolute terms, while increasing the Malay share in relative terms as well.[10]
A sum of
At the time the plan was announced, the non-Malays had, in the words of one commentator, "a virtual
Industrialisation
Several government agencies that had been established prior to the advent of the Second Malaysia Plan increased their participation in the economy during the Second Malaysia Plan. These agencies included the
PERNAS was established to purchase businesses and participate in joint ventures with private companies, as well as to develop nascent industries to be held in trust until the Malays held sufficient capital to take them over. By the end of the plan's tenure, PERNAS owned 100% of eight companies involved in insurance, trading, construction, properties, engineering, securities, and mining. Joint ventures had also been formed with the private sector to develop the mining, containerisation, tourism and consulting industries.[13]
Parliament passed the Industrial Coordination Act during the Second Malaysia Plan, which required all new manufacturing enterprises with
Until the Second Malaysia Plan, industry was concentrated on the west coast of Peninsular Malaysia. The plan thus moved to establish new industrial estates on the east coast, in order to curb rural-urban migration—the east coast was considerably less urbanised than the west coast.[15]
By 1975, manufacturing activities constituted 16% of the Malaysian
Mining
Until the late 1970s, Malaysia was the world's foremost producer of
The number of Malays employed in the mining sector soared from 1970 onwards, as the government's restructuring policies came into force. When the Second Malaysia Plan began, less than 200,000 Malays were employed in the mining industry. By 1990, they numbered nearly a million, well ahead of the target numbers originally outlined.[20] Licences for mining operations were specially reserved for Malays as part of the drive to increase their ownership level in the mining industry.[21] The government also ostensibly increased Bumiputra ownership by nationalising several formerly foreign mining companies—by 1989, state corporations controlled 60% of the mining industry.[22] The government was also aided by the fact that petroleum soon eclipsed other minerals in the mining sector—as Petronas was a state-owned corporation, it was also considered a Bumiputra enterprise. However, the government has been criticised for this practice, as it is argued nationalised corporations belong to the public at large, and not only to the Bumiputra.[23]
Agriculture
The Second Malaysia Plan continued the initiatives that previous five year plans, such as the
Growth in small-scale agriculture was viewed as crucial to creating jobs and reducing rural poverty, and government agencies such as
The land development and resettlement policies instituted by the government, however, failed to make an impact on rural poverty. The government managed to resettle only 40,000 people, despite an estimated 535,000 families engaged in agriculture living below the poverty level. Due to inefficiencies in the program, the beneficiaries of resettlement and development were not always those with the greatest need. It was also alleged by some[by whom?] that there had been too much emphasis on the difficult process of resettlement and development of new areas, instead of increasing productivity in existing farms. Matters were complicated by the Constitution, which gave the states much control over land development, and thus requiring the federal government to negotiate with individual state governments. Non-Malay rural families also did not benefit much due to this, as the Constitution reserved portions of land for the Malays, and state governments were not anxious to receive destitute non-Malays.[30]
Although the Second Malaysia Plan greatly modernised the "
Health
The Second Malaysia Plan continued past initiatives in raising nutritional levels through a number of programs. These included incentives to grow nutritious food, instruction in nutrition and menu planning, and provision of food for groups with the highest rates of malnutrition. However, these programs were hindered by a lack of trained medical personnel.[32]
Although
Education
Although education was mostly sidelined in favour of socioeconomic restructuring programs during the Second Malaysia Plan, some important initiatives were taken during its tenure.[35] In 1970, Malay, the national language, became the major medium of instruction from primary to tertiary level, replacing English. British standardised examinations were replaced with local ones, and new Malay-language textbooks were introduced. By the end of the plan, most formerly English-based schools had converted the first four years of instruction entirely to the new Malay-medium curriculum.[36]
In 1973, the Curriculum Development Centre was established. Its goal was to co-ordinate projects to reform the curriculum that had previously been handled by varying government departments. It also began revamping the curriculum for science and mathematics, and began a new program to review the various social science curricula.[37]
The Second Malaysia Plan also hoped to increase the availability of vocational and technical training. Despite some attempts, little progress was made in improving the curriculum, which focused on providing a general education and made little room for vocational or technical training. Several new technical and vocational schools were built under the Second Malaysia Plan, with seven institutions alone completed in 1975. It was hoped this would alleviate the problem of unemployment, especially among the youth.[38]
Transportation
The Second Malaysia Plan aimed to modernise Malaysian railroads, which the government regarded as crucial to development and industry. All trains were converted to use the more efficient diesel fuel, and the government increased allocations for maintenance and modernisation of the rail infrastructure. In particular, emphasis was placed on upgrading existing rolling stock, roadbeds, and repair facilities.[39]
Air service was expanded under the plan, which paid for the purchase of all-weather and night traffic control equipment, as well as the training of staff to handle the equipment. The Second Malaysia Plan also saw Malaysia-Singapore Airlines split into the
The Second Malaysia Plan also saw the introduction of
At the time of the Second Malaysia Plan, there were only two sea
Legacy
At the end of the Second Malaysia Plan, the poverty rate was found to have declined from 49% to 43%. Unemployment improved slightly, decreasing from 7.5% to 7.4%. Great strides were made in increasing Bumiputra involvement in the private sector, however; the employment rate of Bumiputra in the manufacturing sector increased from 29% to 33%, and from 24% to 34% in the commercial sector. Bumiputra equity ownership more than doubled from 3% to 7.8%. However, this was considered unsatisfactory by many, especially as much of the progress had been made by government enterprises holding the equity in trust.[43] Although the plan had initially targeted a GDP growth rate of 12.5% a year, only an average of 11% was managed. The growth was extremely uneven; while in 1973 GDP grew by 27%, in 1975, it grew a paltry 3% due to the global recession at the time.[44] Despite the government's efforts to tackle unemployment, creating 600,000 new jobs during the Second Malaysia Plan, the number of unemployed actually increased between 1970 and 1975; in 1970, there were 275,000 unemployed, but by 1975, the number stood at 324,000.[45]
The Second Malaysia Plan was also forced to confront an unexpected problem: inflation. Between 1972 and 1975, the consumer price index (CPI) unexpectedly increased by 40%. In 1974, the inflation rate averaged 18%, although it was reduced to 7% by 1975.[46] This new conundrum was therefore considered by the government when it set out the Third Malaysia Plan (1976–1980).
Another overarching consequence of the Second Malaysia Plan was its efforts in crop diversification. Despite RISDA failing to meet its targets, the palm oil industry in Malaysia continued to grow. By 1998, palm oil was the second-largest contributor towards Malaysia's GDP, second only to electronics products.[47]
Overall, the Second Malaysia Plan made much more substantial progress towards reducing the inequity in the economy than its predecessor had. However, the emphasis on improving the lot of the Malays greatly worried the non-Malays, and when the Third Malaysia Plan was launched, the government toned down its rhetoric on affirmative action and emphasised greater economic growth, which would benefit all.[10]
See also
Notes
- ISBN 983-74-2024-3.
- ^ Henderson, John William, Vreeland, Nena, Dana, Glenn B., Hurwitz, Geoffrey B., Just, Peter, Moeller, Philip W. & Shinn, R.S. (1977). Area Handbook for Malaysia, p. 323. American University, Washington D.C., Foreign Area Studies. LCCN 771294.
- SUARAM. Archived from the originalon 2 October 2015. Retrieved 22 November 2015.
Thus, in early 1971 the Constitution (Amendment) Act was passed adding a new clause (No. 8A) to Article 153: ... This is the "quota system" we have lived with for the last forty years or so and which has created so much controversy for that length of time.
- ^ Henderson, et al., pp. 147–149, 322.
- ISBN 0-19-588988-6.
- ^ Henderson, John William, Vreeland, Nena, Dana, Glenn B., Hurwitz, Geoffrey B., Just, Peter, Moeller, Philip W. & Shinn, R.S. (1977). Area Handbook for Malaysia, p. 293. American University, Washington D.C., Foreign Area Studies. LCCN 771294.
- ^ Means, p. 24.
- ^ Henderson, et al., p. 294.
- ^ a b Henderson, et al., p. 324.
- ^ a b Henderson, et al., p. 6.
- ^ Shuid & Yunus, p. 86, 87.
- ^ Henderson, et al., pp. 37, 90–92.
- ^ a b Henderson, et al., p. 322.
- ^ Henderson, et al., pp. 323, 325.
- ^ Henderson, et al., p. 325.
- ^ Henderson, et al., pp. 331–332, 339.
- ^ Henderson, et al., pp. 325, 327.
- ISBN 983-62-7831-1.
- ^ Henderson, et al., pp. 329, 331.
- ^ Snodgrass, Donald R. (1991). "Successful Economic Development in a Multi-Ethnic Society: The Malaysian Case" Archived 3 March 2016 at the Wayback Machine. Retrieved 17 February 2006.
- ^ Heng, Pek Koon (1997). "The New Economic Policy and the Chinese Community in Peninsular Malaysia" Archived 19 December 2016 at the Wayback Machine. The Developing Economies XXXV-3: 262–292. Retrieved 21 December 2011.
- ^ Aslam, Mohamed & Hassan, Asan Ali Golam (2003). "Development Planning and Regional Imbalances in Malaysia". Retrieved 17 February 2006.
- ^ Kamarudin, Raja Petra (22 March 2005). "The need for a marriage counsellor". Malaysia Today.
- ^ Kamil, Nik Fuad, Alwi, Syed Abdillah & Singh, Mukhtiar (1996). "MALAYSIA". Retrieved 16 February 2006. Archived 12 March 2006 at the Wayback Machine
- ^ Butz, William & DaVanzo, Julie (1998). "First Malaysian Family Life Survey, 1976–1977" Archived 17 March 2012 at the Wayback Machine. Retrieved 16 February 2006.
- ^ Mohd. Arshad, Fatimah & Shamsudin, Mad Nasir (1997). "Rural Development Model in Malaysia" Archived 22 February 2014 at the Wayback Machine. Retrieved 16 February 2006.
- ^ Henderson, et al., pp. 307, 308.
- ^ Henderson, et al., p. 309, 311.
- ^ Mispari, Abdul Wahab & Hasan, p. 131, 133.
- ^ Henderson, et al., pp. 311–312.
- ^ Henderson, et al., p. 313.
- ^ Henderson, et al., p. 36.
- ^ Henderson, et al., p. 35, 36.
- ^ Chin, Christine B.N. (1998). "In Service and Servitude"[permanent dead link]. Retrieved 15 February 2006. [dead link]
- ^ Henderson, et al., p. 165.
- ^ Henderson, et al., p. 171.
- ^ Henderson, et al., p. 170.
- ^ Henderson, et al., pp. 169–170, 174.
- ^ Henderson, et al., p. 29.
- ^ Henderson, et al., pp. 29–30.
- ^ Tengku Mahmud Shah Al-haj, Tengku Jamaluddin Bin (2003). "Liberalization of the Container Haulage Industry in Malaysia" Archived 4 March 2016 at the Wayback Machine. Retrieved 17 February 2006.
- ^ Bajpai, Nirupam & Shastri, Vanita (1999). "Port Development in Tamil Nadu: Lessons from Chinese Provinces" Archived 3 March 2016 at the Wayback Machine. Retrieved 17 February 2006.
- ^ Henderson, et al., pp. 295–296.
- ^ Henderson, et al., p. 285.
- ^ Henderson, et al., p. 37.
- ^ Henderson, et al., p. 150.
- ^ "Crude Palm Oil Futures". Retrieved 16 February 2015.
References
- Henderson, John William, Vreeland, Nena, Dana, Glenn B., Hurwitz, Geoffrey B., Just, Peter, Moeller, Philip W. & Shinn, R.S. (1977). Area Handbook for Malaysia. American University, Washington D.C., Foreign Area Studies. LCCN 771294.