Malaysia's Economic Development Policies Quiz

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Questions and Answers

What was the main objective of the government's approach to growth with equity and active participation?

To create national unity.

List two strategies used to eradicate poverty among the poor population in Malaysia.

Increasing access to land and capital, and providing education and employment opportunities.

What role did MARA play in the strategy to eradicate poverty?

MARA was established to increase educational and employment opportunities for Bumiputera.

Describe one way the restructuring of society aimed to reduce dependence on subsistence agriculture.

By increasing the role of Malays and indigenous people in modern sectors of the economy. Signup and view all the answers

What was a significant aim of the National Development Plan (NDP) introduced in 1991?

To achieve balanced development and eventually eradicate poverty. Signup and view all the answers

What is the main objective of the New Economic Policy (NEP) introduced in Malaysia?

The main objective of NEP is national unity. Signup and view all the answers

How long did the New Economic Model (NEM) plan span?

The New Economic Model spanned from 2011 to 2020. Signup and view all the answers

What characterizes long-term economic development plans in Malaysia?

Long-term plans cover periods of more than 6 years. Signup and view all the answers

What is the time frame for Medium Term Plans in Malaysia?

Medium Term Plans cover periods of 5 years or less than 5 years. Signup and view all the answers

Identify one advantage and one disadvantage of privatization in Malaysia.

Advantage: Increased efficiency; Disadvantage: Potential job losses. Signup and view all the answers

Name one of the annual budgets mentioned in the short-term plans.

Budget 2020. Signup and view all the answers

What distinguishes the New Economic Policy from earlier plans?

NEP focuses primarily on achieving national unity. Signup and view all the answers

What is the duration of the National Development Plan (NDP)?

The National Development Plan lasted from 1991 to 2000, for 10 years. Signup and view all the answers

What is the primary objective of the National Vision Policy (NVP)?

The primary objective of the NVP is to promote national unity and establish a united, progressive, and prosperous Bangsa Malaysia. Signup and view all the answers

What strategies does the New Economic Model (NEM) focus on to transform the economy?

The NEM focuses on high-income and quality growth strategies to overcome the middle income trap. Signup and view all the answers

How does the National Development Policy (NDP) aim to eradicate poverty?

The NDP aims to eradicate poverty through human resource development and increasing private sector participation. Signup and view all the answers

What were the timeframes for the 8th and 9th Malaysia Plans mentioned in the context of the NVP?

The 8th Malaysian Plan spans from 2001 to 2005, and the 9th Malaysian Plan covers 2006 to 2010. Signup and view all the answers

What role does sustainable development play in the strategies of the NVP?

Sustainable development ensures that future generations can benefit from current economic growth. Signup and view all the answers

What challenge is Malaysia facing that the New Economic Model (NEM) is designed to address?

Malaysia is facing a middle income trap, which the NEM aims to resolve by promoting high-income growth. Signup and view all the answers

What is one way the NVP plans to close the development gap between regions?

The NVP pursues balanced development as a strategy to close the regional development gap. Signup and view all the answers

Which technological advancements does the NVP leverage to eradicate poverty?

The NVP promotes opportunities in information technologies, including ICT and the K-economy. Signup and view all the answers

What are the three primary objectives of the New Economic Model (NEM) for Malaysia from 2011-2020?

High income status, sustainability, and inclusiveness. Signup and view all the answers

How does the NEM propose to re-energize the private sector?

By rationalizing business incentives and creating a conducive environment for private investment. Signup and view all the answers

What is the goal of developing a quality workforce under the NEM?

To inspire the workforce to draw out their best and reduce dependency on foreign labour. Signup and view all the answers

In what way does the NEM aim to create a competitive domestic economy?

By improving economic efficiency through competition and building entrepreneurship. Signup and view all the answers

What does strengthening the public sector entail in the context of the NEM?

Creating a lean and customer-focused government to improve decision making and service delivery. Signup and view all the answers

What is the significance of transparent and market-friendly affirmative action within the NEM?

It aims to escape low income situations by increasing income and narrowing the gap between rich and poor. Signup and view all the answers

What challenge remains for Malaysian households despite the reduction of poverty?

40% of Malaysian households still earn less than RM1,500 a month. Signup and view all the answers

How will the NEM enhance the sources of growth?

By supporting firms that invest in innovative and technologically advanced production and services. Signup and view all the answers

What are the three essential components involved in the privatization process?

Management responsibility, assets, and personnel. Signup and view all the answers

How does the concept of 'green GDP' address environmental concerns?

It allows for proper consideration of the environmental impacts of growth and enables the design of measures to address these concerns. Signup and view all the answers

What is one major disadvantage of privatization regarding consumer costs?

Consumers may face higher prices for services such as water and electricity. Signup and view all the answers

Name two advantages of privatization for the government.

Reduction in administrative burden and tax revenue from privatized entities. Signup and view all the answers

What is one possible impact of privatization on workers' welfare?

Workers may experience reduced welfare due to firms focusing solely on profit maximization. Signup and view all the answers

List three sectors included in Malaysia's Economic Transformation Programme.

Oil, gas and energy; healthcare; and tourism. Signup and view all the answers

What reform is ongoing in the civil service to improve public services?

Staff up-skilling and retraining. Signup and view all the answers

How does privatization potentially affect the income gap in society?

It may widen the income gap by benefiting those already involved in the corporate sector more than others. Signup and view all the answers

What is the target average real growth rate for the economy set for 2011-2020 under the New Economic Model?

6.5% per annum Signup and view all the answers

What is the intended percentage increase in private investment by 2020 according to the New Economic Model?

20% Signup and view all the answers

What is the goal of market-friendly affirmative action programs under the New Economic Model?

To build capacity and capability of low-income households and small businesses. Signup and view all the answers

Identify one measure proposed to ensure sustainability in the economy as per the New Economic Model.

Establishment of fiscal discipline. Signup and view all the answers

How does the New Economic Model suggest addressing income disparity among Malaysians?

By promoting equal and fair access to opportunities. Signup and view all the answers

What social outcome is aimed for by the second objective of the New Economic Model?

Generating benefits for all Malaysians. Signup and view all the answers

What should be considered before making investment and policy decisions to ensure sustainability?

Long-term impact on society, economy, and environment. Signup and view all the answers

What fiscal condition was targeted for reduction from 2009 to 2010?

Fiscal deficit. Signup and view all the answers

What role does 'aggregate demand' play in the New Economic Model's vision for economic progress?

It must grow at a robust pace. Signup and view all the answers

What type of resources should be accessed to improve capacity, incomes, and well-being according to the New Economic Model?

Resources on the basis of needs and merit. Signup and view all the answers

Study Notes

Chapter 2: Background of Malaysian Economic Development

This chapter covers the background of Malaysian economic development.
It outlines various economic development policies, including short-term, medium-term, and long-term plans.
Different policies are examined, such as the New Economic Policy (NEP), National Development Plan (NDP), National Vision Policy (NVP), New Economic Model (NEM), and Privatization.
Each policy's objectives and strategies are detailed.
Privatization includes advantages and disadvantages, as well as its implementation in 12 specific National Key Economic Areas (NKEAs).

Overview of Economic Development Policies

Long-term plans cover periods greater than 6 years (e.g., New Economic Policy, National Development Plan, National Vision Policy, New Economic Model).
Medium-term plans cover a shorter period, typically 5 years or less (e.g., Malaya plans, Malaysia plans).
Short-term plans are annual budgets (e.g., Annual Budget, Budget 2020, Budget 2019, Budget 2018).
Time periods of various plans are listed (e.g., NEP from 1971-1990, NDP 1991-2000, and NEM 2011-2020).
5-Year Development Plans (e.g., 1st-11th Malaysian Plan) and their corresponding periods are listed in a table format (pre-NEP, NEP, NDP, NVP, NEM).

New Economic Policy (NEP) 1971-1990

Main objective is national unity.
Growth with equity and active government participation in the economy.
Strategies focus on:
- Eradicating poverty.
- Restructuring society.

National Development Plan (NDP) 1991-2000

Reaffirmed the relevance of NEP while introducing new challenges.
To create national unity through "Balanced Development."
Strategies focus on:
- Reducing poverty.
- Accelerating the process of restructuring Malaysian society.

National Vision Policy (NVP) 2001-2010

Begins with the 8th Malaysian Plan (2001-2005) and continues to the 9th Malaysian Plan (2006-2010).
Objective is national unity.
Progressive and prosperous Bangsa Malaysia that lives in harmony and engages in full and fair partnership.
Strategies focus on:
- Eradicating poverty irrespective of race.
- Restructuring of society
- Balanced development.
- Strategies of Vision 2020.

New Economic Model (NEM) 2011-2020

To transform the Malaysian economy into a high-income economy.
Aims for high income and quality growth by 2020.
Malaysia's economic growth is slowing, caught in a middle-income trap.
40% of households earn less than RM1,500/month.
Objectives include high-income status, sustainability, and inclusiveness.
Strategic initiatives focus on re-energizing the private sector, quality workforce, a competitive economy, public sector strengthening, and building infrastructure.
Objectives for the NEM strategy include boosting efficiency, unlocking investment, labor productivity, higher gross domestic product, and growth rate.
Further reduction in fiscal deficit from 7.4% (2009) to 5.6% (2010).

Privatization

Transfer of public sector activities and functions to the private sector.
Applies to existing government-owned enterprises and new projects.
Includes management responsibility, assets, and personnel.
The government introduced Privatization Policy in 1983.
Advantages include benefits to the public, manpower development, economic growth, and technology transfer.
Disadvantages include higher prices (e.g., water, electricity), inflation, and reduction in social services.

Economic Transformation Programme (12 NKEAs)

National Key Economic Areas are outlined, covering areas like oil, gas, energy, palm oil, rubber, financial services, tourism, business services, electronics, wholesale & retail, education, healthcare, communication, agriculture, and Greater Kuala Lumpur/Klang Valley.

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Description

Test your knowledge on Malaysia's government strategies for economic development, including the New Economic Policy, National Development Plan, and methods used to eradicate poverty. This quiz covers the objectives, roles, and plans implemented to promote growth with equity in Malaysia.