THE Bumiputera agenda in the 12th Malaysia Plan (12MP) will be the government’s main selling point in the lead up to the 15th general election, an analyst said.

Ilham Centre executive director Hisommudin Bakar said the five-year plan, tabled by Prime Minister Ismail Sabri Yaacob in Parliament on September 27, is aimed at easing Malay anxiety about their stake in the economy.

“This will be Barisan Nasional and Perikatan Nasional’s main selling point come GE15, the Bumiputera agenda.

“They have included this in the RMK12 (12MP) in the hopes that it will ease the worry of Malay voters that their future is given priority,” Hisommudin told The Malaysian Insight.

However, others point out that the agenda, as detailed in the 12MP, is in fact unhelpful to much of the community it purports to help.

Under the 12MP, Bumiputera shares or companies will only be offered and sold to fellow Bumiputera consortiums, firms and individuals under a new initiative aimed at boosting Bumiputera equity ownership from 17.2% in 2019, to 30%.

Currently, non-Bumiputera controlled 25% of corporate equity and foreign investors own 45.5%, while the remaining 12.3% was held by nominees.

This new policy, which allows shares of Bumiputera-held entities to be traded only within the community, has come under severe criticism from lawmakers and economists.

Economist Nungsari Radhi said this policy will not boost investors’ confidence.

“The Bumiputera agenda that they’ve put in will dampen investors’ confidence. To say the sorts of things they’ve said does not imbue confidence.”

Enriching the ‘cronies’

Teluk Intan MP Nga Kor Ming said the Bumiputera agenda, promoted in this manner, will only enrich the wealthy within the community and not benefit all Malays.

“It is a discrimination against the Bumiputera, and they (will be) the biggest losers. The restriction may see Bumiputera businesses forced to sell their businesses at a loss or below market value as they are not able to trade with other investors or even foreign investors.

“This policy will only enrich the cronies, and the income gap between rich Bumiputera and the poor will only increase because of this.

“The government should focus on how to enlarge the pie and bring in more businesses, not how to distribute the pie.”

Nga also cast doubts on the current Bumiputera equity 17.2% figure, saying that it does not appear to take into account government-linked entities such as Mara, Khazanah Nasional and Tabung Haji.

Besides increasing Bumiputera participation in business, the 12MP’s Bumiputera agenda also seeks to close household income gaps affecting the community.

The plan states that the median income gap between the Bumiputera and the Chinese is widening. In 1989, the median Chinese household income was RM1,180 while median Bumiputera household income was RM680. The difference was RM500.

In 2019, the corresponding figures were RM7,400 for Chinese households and RM5,400 for Bumiputera households. The difference was RM2,000.

The 12MP outlines the government’s initiative for the next five years to reset Malaysia’s economic growth after the Covid-19 epidemic.

Among the goals set by the government is to increase GDP growth from 4.5% to 5.5% per annum. The average GDP growth for the 11th Malaysia Plan had been 2.7% per annum.

While Malaysia is on track for economic recovery, with various sectors reopening after stringent lockdowns, the World Bank, in its East Asia and Pacific Fall 2021 Economic Update, slashed Malaysia’s GDP growth estimate for this year to 3.3%.

Income and sustainability

The government also intends to increase the gross national income (GNI) to RM57,882 per capita by 2025 to qualify as a high-income nation by World Bank standards.

Data from the World Bank show that Malaysia’s GNI decreased from RM46,812.25 (US$11,230) in 2019 to RM44,102.73 (US$10,580) in 2020.

In line with increasing the GNI, Putrajaya aims to increase monthly household income from RM7,160 to RM10,065 by 2025.

In terms of labour productivity, the government has set a 3.6% per annum growth target from 1.1% per annum.

The biggest sustainability goal unveiled by the government in the 12MP is its net zero carbon emission goals by 2050. To that end, a National Energy Policy will be introduced as a long-term strategic support.

To work towards the net zero goal, Putrajaya expects renewable energy to account for 31% of the country’s total energy capacity by 2025.

The government has also committed to reducing greenhouse gas emission by 45% to the GDP by 2030 compared with the 2005 level, in line with the Paris climate agreement. – October 19, 2021.