2nd ASEAN Conference on Competition
Policy and Law
ECONOMIC GROWTH AND
COMPETITION POLICY IN
MALAYSIA
By
Dato’ Seri Talaat Hj. Husain
Secretary-General
Ministry of Domestic Trade & Consumer Affairs,
Malaysia
Malaysia’s Economic Development :
The Philosophy
Development Philosophy:
ƒ Through system of free enterprise but with active
Government support and direction.
ƒ Government provides the broad thrusts and sets
direction for the whole economy, and ensures the
achievements of socio-economic goals.
ƒ Private sector is free to operate and given
appropriate policy, institutional and infrastructural
support.
Malaysia’s Economic Development :
The Philosophy
Milestone of economic policies:
ƒ1951 - 1970 : economic and rural development (Laissez
faire/export oriented)
ƒ1971 - 1990 : New Economic Policy - growth with equality
ƒ1991 - 2020 : Vision 2020 – total development
ƒ1991 - 2000 : National Development Policy – balanced
development
ƒ2001 - 2010 : National Vision Policy- building resilient and
competitive Nation
Malaysia’s Economic Development :
The Philosophy
Vision 2020 - Economic Development:
Average Annual output growth at 7% with low
inflation
„ An eight-fold increase in GDP
„ A four-fold increase of per capita incomes
„
Malaysia’s Economic Growth
Different policies implemented at different stages with
different policy objectives:
Industrial Policy
„
to establish and nurture specific and targeted
firms/industries.
Trade Liberalization
„
lowering of tariffs and trade barriers to benefit
business and consumers.
Malaysia’s Economic Growth
Encouraging Foreign Direct Investment
„
number of services markets and the
manufacturing sector liberalized.
Privatization Policy
„
to create more efficiency in the market.
Socio-economic Policy
„
to eradicate poverty and redress racial
economic imbalance & wealth redistribution.
Economic Growth and Competition
Policy in Malaysia
Economic Growth
Competing Objectives
Contradicts Overarching
Objectives of
Competition Policy
Varied Policies
Economic Growth and Competition
Policy in Malaysia
Competition policy is an important tool but for
Malaysia must take into consideration the
following issues:
„
Industrial policy Æ led to domestic
monopolies
„
trade liberalization must ensure small
domestically-owned firms do not suffer from
unfair trade practices.
Economic Growth and Competition
Policy in Malaysia
small market size of Malaysia Æ sustains few
players to benefit from economies of scale
and scope.
„ SMEs position in the market Æ constraints
ability to enjoy economies of scale and limit
their market access.
„ Privatization Æ Government Linked
Companies Æ have social and commercial
objectivesÆ need to preserve their
monopolistic power.
„
Conclusion
„
Competing objectives between competition
policy objectives and economic and social
objectives Æ restraint for Malaysia.
„
Slow but sure progress in implementing
competition policy in Malaysia.
„
Competition policy needed to ensure benefit of
growth Æ equitably distributed between
consumers and business.
THANK YOU