I was interviewed by Malaysiakini TV earlier today about the New Economic Model. Others on the panel were Richard Yeoh (REFSA) and Akhramsyah Sanusi (MAYC). It should be available for viewing early next week.
I was pushing the view that the NEM is a good start. It is committed to initiate a liberalising process of Malaysia’s economy. But it stopped short of being fully committed to a liberal economic agenda. For example, while the NEM document said it is bad for government to crowd the market by having government linked companies (GLCs), the only effort to rectify the problem is by selling of government’s stakes in a small number / selected GLCs. But the real problem is the very existence of GLCs. The problem is not just the companies that have been selected to be divested, but the likes of Petronas, Khazanah, TNB, TM, etc.
I got a bit stuck when asked should the government help the poor. I have no doubt that the government SHOULD NOT get involved in providing welfare. Looking at Malaysia’s experience, when the government tries to deliver welfare, it quickly became selective and political. But I do not yet know how that could be stopped in Malaysia. I know the principle, but I don’t yet know the “how”.
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