In a matter of a few days, the Bumiputera Economic Congress 2024 (KEB 2024) will take place from February 29 to March 2, 2024. Eagerly anticipated, it promises a novel trajectory for the development of the Bumiputera economy.
Embedded within the constitutional fabric, the rights and privileges accorded to the Bumiputera are unequivocally defined. Article 153 underscores that the Bumiputera development agenda is constitutionally ordained. Since the inception of the New Economic Policy (NEP) in 1971, the economic agenda for the Bumiputera has endured as a linchpin in the nation's developmental ethos, albeit with nuanced approaches.
Affirmative policies must have clear goals and good governance
Economic power based solely on merit is ideal if everyone starts from the same line, with equal opportunities to compete. However, the reality is different. The Bumiputera were marginalized early in the nation's development process.
While significant progress has been made by the Bumiputera, this specter of 'marginalization' persists. Bumiputera make up 70 per cent of Malaysia's population, yet paradoxically they assume a minority role in the economic theatre.
The five states with a high Bumiputera population (exceeding 80 per cent) also concurrently grapple with sluggish economic growth, modest household incomes, and elevated poverty indices. Refer to the graphics for a clearer insight. Bumiputera, constituting the largest demographic group within low-income households (B40) and the economically disenfranchised, continue to grapple with income disparities. Since 1970, the economic standing of Bumiputera households consistently languishes as the least affluent compared to their Chinese and Indian counterparts.
The Bumiputera agenda must be based on a clear development model, with detailed and measurable goals, supported by effective governance. Implementation progress should be monitored and reported regularly, ensuring accountability for all governing authorities.
A strategic imperative: A blueprint for Bumiputera economic renaissance
Leading Economist Professor Tan Sri Dr. Noor Azlan Ghazali asks the following questions - what are the goals, focus, strategies, and benchmarks for Bumiputera development? Various answers will emerge, including property ownership, Malay reserve land area, Bumiputera household income, poverty levels, educational achievements, entrepreneurship levels, and more. Some still adhere to the 30 per centequity target as the sole focus.
In the past, special development institutions linked to Bumiputera like MARA, TERAJU, UDA, and UITM were established. Perhaps now is the time for newer institutions with no historical baggage to be created. With closer scrutiny on their establishment terms and individual mandates.
Professor Noor Azlan Ghazali points out that there is no overarching plan, focus, or strategy for Bumiputera economic development that is universally held. There is no coordination or unity of goals. Specific databases and research programs for Bumiputera development are lacking. While the Statistics Department only reports from a general overview and outlook.
KEB 2024: Rejuvenating the Bumiputera economic development agenda
Clearly a unified model is needed to encompass the direction of Bumiputera economic development. This explains the government's new approach to drive this institutionalised agenda.
Professor Noor Azlan Ghazali posits a novel framework, encapsulated by the triad of participation, ownership, and mastery (POM), to envelop the Bumiputera economic agenda. This POM model revolves around three developmental pillars aimed at cultivating sustainable success in Bumiputera economic ascension. These pillars transcend the following three main cores:
1) PARTICIPATION - At its crux lies the ability of Bumiputera to actively participate in economic activities. The level and quality of education and skills must be the primary focus of Bumiputera development. Without high-value knowledge and skills that align with the contemporary demands of the times, Bumiputera will be at risk of falling behind. Currently, only 29 per cent of Bumiputera workforce is categorised as skilled, with the majority (62 per cent) being semi-skilled. While access to education has improved, the main challenge is the quality of education and skills attainment among the Bumiputera. What is the quality of the Bumiputera workforce today?
2) OWNERSHIP - The contemporary creation of wealth necessitates widespread Bumiputera involvement, transcending mere employment to encompass active entrepreneurship. Business ownership mandates a heightened entrepreneurial acumen, recognizing that not all with an educational pedigree possess entrepreneurial verve. The strategic ascent through entrepreneurial echelons, from micro-enterprises to small, medium, and large enterprises, also known as strategy of 'climbing the ladder' must assume the mantle as the core focus of Bumiputera ownership. This trajectory necessitates synchronization with the New Industrial Master Plan 2030, targeting high-tech economic activities and skilled jobs. The involvement of Bumiputera entrepreneurs in high-value economic activities needs to increase, fostering their status as globally competitive players. What is the status of Bumiputera entrepreneurs today?
3) MASTERY - The zenith of Bumiputera economic success resides in mastery,
symbolizing elevated competitiveness and a pervasive Bumiputera dominance across diverse economic sectors. Each sector covers an extensive chain of activities. For instance, within the healthcare sector, there is a need for general practitioners, specialists, clinics, hospitals, pharmacists, dentists, nurses, medical colleges, pharmaceutical supply chains, medical technology, rehabilitation facilities, therapy services, outpatient services, health insurance services, and beyond. The fragility of Bumiputera ownership persists if it remains isolated, diminutive, and dispersed, devoid of strategic alignment within the value chain of any economic sector. Mastery necessitates conspicuous Bumiputera presence, commanding each tier of supply and service provision within a given economic sector. Strategic planning is imperative for Bumiputera to fortify their mastery within economic sectors. In which sectors do Bumiputera (potentially) have mastery?
The culmination of Bumiputera economic development success is when POM occurs simultaneously. Each of these cores requires strategic action from an array of stakeholders.
The POM model requires unity of goals and coordination from various parties. Each core must be monitored and measured – where are we now, and where do we want to be?
In this context, the establishment of a Bumiputera Development Research Center assumes paramount significance, providing a bedrock for data support, conducting research, and analytical studies to evaluate economic progress and scrutinise challenges confronting the Bumiputera.
A dedicated team needs to be given a strong mandate to coordinate various implementing agencies and report directly to the Prime Minister. This "Bumiputera Economic Council" chaired by the Prime Minister should be the highest council for the Bumiputera economic development agenda.
Should the Bumiputera, constituting 70 per cent of Malaysia's demographic mosaic, triumph, the reverberations will resonate throughout Malaysia. The confluence of POM possesses the potential to strenghthen the Bumiputera economy.
May the KEB 2024 rejuvenate the Bumiputera economic development. Let us aim for a day when the Bumiputera can compete within and outside the country.
*The writer is currently serves as a Senior Consultant at Global Asia Consulting (GAC) and was previously a senior researcher at the Malaysian Institute of Economic Research. The viewpoints articulated are solely those of the author.