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A better life for Malaysians through public-private partnerships
KUALA LUMPUR: Malaysia's pathway of progressive government in partnership with a vibrant private sector has been powering the country towards its goals and helping to create a better life for its people, says Michael J. Hershman, a co-founder of Transparency International.
"Whatever the results of the next election, the Malaysian model is already an enduring legacy of Datuk Seri Najib Tun Razak’s government," he wrote in an article in the latest issue of Forbes Asia magazine entitled, "The Malaysian Third Way: A Public-Private Partnership".
A former senior staff investigator for the United States (US) Senate’s historic “Watergate” Committee and a consultant to the Malaysian Anti-Corruption Commission (MACC) tasked with building a national strategy against corruption, Hershman said the debate in Malaysia between those who want more government and those in the private sector who believe prosperity and job creation can best occur with less government is not unusual.
"It is occurring all over the world -- in the US, the EU and the recent French presidential elections, and throughout nations in Asia and the Pacific Rim," he said.
But Hershman said it is apparent that the ultimate solution is neither total reliance on government nor the private sector, but rather, a third-way path -- a public-private partnership to bring prosperity and economic progress to the average citizen.
That is the model that, in the last several years, the prime minister has followed to implement his Economic Transformation Programme (ETP) and Government Transformation Programme (GTP), he said.
"Over the past year, I have served as a member of Malaysia’s International Review Panel created to review the results of both the GTP and ETP, and I have seen first-hand that real progress is being made.
"Unlike most politicians who forget their campaign promises, Najib has asked to be judged and held accountable for the progress he has, or has not, made.
"In other words, he wanted a report card -- and better yet, he wanted everyone to see it. And they will. Ultimately, he is prepared to be judged by the ultimate arbiters of success or failure in a democracy: the voters of his country," he wrote.
When Najib began the ETP a year ago, Hershman said the prime minister established specific goals to be achieved by the year 2020 -- to transform Malaysia into a higher development nation with a per capita income of at least US$15,000 and to attract and channel US$444 billion in most private investments to break Malaysia out of the “middle-income” trap and economic stagnation that it had experienced in recent years.
"Consistent with the 'third way' mixture of government and private market leadership, he turned to one of his ministers, Datuk Seri Idris Jala, a former successful chief executive of Malaysia Airlines, to lead the ETP.
"Najib and Idris have committed to reduce the country’s chronic budget deficits over five to seven years, streamline government to make it more conducive to private sector investment and job creation. And they already have made considerable progress."
For example, the ETP has moved to cut by half 761 varieties of licences that under the current system are required for most business startups to acquire.
And under Najib and Jala’s leadership, the government has reduced its large role in the economy by divesting stakes in 33 companies.
On a variety of social progress fronts, Najib’s government has moved aggressively to improve the quality of life of the average Malaysian.
In 2010 and 2011, participants in the GTP conducted “laboratory sessions” to establish specific, achievable social goals in six areas: raising public living standards; improving education outcomes; reducing crime; advancing the fight against government corruption; enhancing urban public transportation; and improving rural basic infrastructure.
Results have been apparent and measurable. By the end of 2011, Malaysia witnessed a 35 per cent reduction in street crime in high-crime neighbourhoods and built over 35,000 low-cost housing units.
The government created anti-corruption courts to adjudicate corruption cases within 12 months and passed a strong whistle-blower law to protect the courageous individuals who come forward to report and identify corrupt practices and public officials.
Further measures were enacted to strengthen private sector competitiveness, including a new law that levels the playing field for businesses and guards against anti-competitive practices.
And the movement to reduce government ownership and to divest functions to the private sector, where efficiencies and jobs can be allowed to flourish, continued.
The oil, gas and energy sector realised significant incentives for exploration of marginal oil and gas fields.
By the end of 2011, Malaysia had moved ahead of advanced economies of Germany, Japan and Switzerland on the World Bank’s 2012 “Doing Business Report”, and had achieved the highest Gross Domestic Product in its history.
But Hershman said "Najib knows that serious challenges remain, especially in the implementation of reform through his two-year-old GTP, and that there is a way to go to guarantee all citizens equal civil rights, the right of political assembly and free speech, and guarantees of equal economic opportunities and justice for all.
This, he said, include the long-term objective of eliminating the vestiges of discrimination and to address this, Najib had launched the New Economic Model that would permit need-based preferences, not ethnic-based preferences.
"But this will take time, as all important social change does. Najib has shown political courage to challenge members of his own party -- the United Malays National Organisation (UMNO) -- to move forward in progress and prosperity, standing for social as well as economic justice for all, regardless of ethnic heritage or race," said Hershman. -- BERNAMA