Government to revive Malaysia Incorporated concept

KUALA LUMPUR: Prime Minister Tun Dr Mahathir Mohamad’s plan to revive the Malaysia Incorporated concept will likely see the introduction of initiatives such as GLIC (government-linked investment companies) divestment programmes and a clean public-private partnership model over the next two years.

UOB senior economist Julia Goh said the government could also reduce public spending by corporatising some government agencies, broadening the federal government revenue base, and imposing targeted subsidies and incentivising companies to compete in the Fourth Industrial Revolution (IR4.0).

“Prime Minister said the new government is reviving the concept of Malaysia Incorporated (Malaysia Inc) and reaffirmed his aspiration of building the third national car project.

“These ideas resonate with the policies implemented during his administration between 1981 and 2003, fanning speculations that some of his past policies may be revived to build a new Malaysia,” she said in UOB Malaysia’s Budget 2019 preview note today.

Meanwhile, Goh said potential focus areas in the 2019 Budget could include technology manufacturing which was in line with the IR4.0 and tourism sector given it is the second largest foreign exchange earner for the country after manufactured goods, with 25.9 million tourist arrivals and RM82.2 billion in tourism revenue last year.

Besides that, she said there would likely be focus on renewable energy, rubber and rubber products given that this was the second largest contributor to commodities exports, automotive, capital markets (as the government will be looking at various financing options and debt issuance, affordable housing options), and the Bumiputera community as the government had signaled that it would be rebooting the Bumiputera agenda.

Source: NST