Want shared prosperity? Ditch race-based policies, says economist

 

Protective policies based on the NEP will lead to a brain drain, with many already having left Malaysia seeking better opportunities, says Ramon Navaratnam.

PETALING JAYA: If the government really intends to achieve its Shared Prosperity Vision 2030 plan, it must start by doing away with race-based policies, says an economist and former civil servant.

Ramon Navaratnam, a former Treasury deputy secretary-general, said protective policies based on the New Economic Policy (NEP) would lead to “a lot” of brain drain, adding that many had already left Malaysia seeking better opportunities.

He told FMT that these local talents did not feel incentivised to work and deliver here, which pointed to a structural weakness.

“Treat all people fairly, that’s what Covid-19 has taught us. Help the poor regardless of race. But when you find your neighbour who’s half as qualified as you getting preference in employment, where is the incentive to compete?

“Where is the incentive to raise productivity and production and therefore economic growth and the capacity to distribute wealth?” he asked.

Ramon Navaratnam.

Citing the civil service, he pointed out that its composition was about 90% Malay right now while only two out of 25 secretaries-general of the ministries were non-Malay.

He contended that this was not the case when he was in the civil service, saying there used to be four Malay civil servants to every single non-Malay at the time, adding that the race quota was minimal and that it, therefore, helped draw top talents.

“There’s no need to compare with countries like South Korea, Hong Kong, Taiwan, the UK or the US. Just compare ourselves with our neighbours like Thailand, Vietnam and Singapore.

“If we are honest, we will see the weaknesses we have created for ourselves and that, worse still, we are not prepared to change. We are a God-blessed country with various resources. That’s why despite our weaknesses and neglect, we still have our head above the water.

”But a time will come where, if we don’t reform, we might not be able to stay that way. We’re not a failed state, but a failing state,” he warned.

He maintained that the NEP was useful at its inception, but its manipulation and “distortion” by certain parties later on caused disunity and slowed down the nation.

Navaratnam also said education was key to Malaysia’s progress or decline, adding that shared prosperity was not simply about a system of taxing the rich excessively to give to the poor.

There needed to be equal opportunity and access to education for all to enable them to progress well in life, he said, adding that Malaysia used to be ranked highly in the PISA rankings and was renowned for its Maths, Science and English capabilities.

“It has to be about equal opportunities, not equal outcomes. Shared prosperity, to me, is just a fancy slogan. The NEP was also premised on shared prosperity.

“It must be genuinely shared according to ability, according to the provision of opportunities. You don’t give a man a fish forever, you give him a fishing rod.

“But you must also make sure that everyone who can use a fishing rod is given one. Don’t just give to some then deny it to others,” he said. - FMT