By A. Stephanie
Idris Jala
Malaysia is on track to become a high-income nation by 2020, according to the Economic Transformation Programme (ETP) 2014 annual report released today by the Performance Management and Delivery Unit (Pemandu), a unit under the Prime Minister’s Department.
In 2014, gross national income (GNI) per capita rose to RM34,123, from RM30,809 boosted by private sector investments at RM146 billion.
Pemandu CEO Idris Jala, in the report, said: “We have also been able to create 1.8 million new jobs within the larger economy in the last four years, striding closer to our 2020 target.”
Launched in 2010, ETP measures Malaysia’s progress towards high-income status using key targets such as reaching US$15,001 in GNI per capita, creating US$444 billion in investments, and 3.3 million employment opportunities by 2020.
At current exchange rates (US$1=RM3.57), Malaysia’s current GNI per capita is 63.7% of the US$15,001 goal, while 54.5% of the targeted 3.3 million jobs have been created, as ETP approaches the halfway mark towards 2020.
Poverty eradication almost complete
Quoting preliminary data from the Statistics Department, the Pemandu CEO also pointed out that ETP has also resulted in reducing poverty in the country, as only 1% of the Malaysian population was living below the poverty line as at 2014, down from 3.8% in 2009.
Jala said: “Over the years, we have seen tremendous success in poverty eradication. This (the 1% living in poverty) also represents a far cry from the first records of poverty in Malaysia collected in 1970, when 49.3%, or almost half, of the population were living in poverty.”
“A 2013 survey carried out by the Asian Development Bank (ADB) found that Malaysia recorded a 55.3% reduction in the percentage of population living below the poverty line, the biggest reduction among Asean countries,” he noted.
In comparison, Indonesia and Vietnam both recorded a 6% reduction whilst the Philippines recorded a meagre 2.5% reduction those living below the poverty line.
ADB noted that this was achieved in Malaysia through cash assistance, 1AZAM programmes which offer microcredit facilities to encourage entrepreneurship among low-income families, healthcare, education, housing and more, Jala said.
Income outstripping inflation
Based on preliminary data from the 2014 Household Income Survey carried out by the Statistics Department, both mean and median growth of household income were at 8.4% between 2012 and 2014.
The ETP annual report noted that this was higher than the corresponding inflation rate of 2.6% per annum. It said the bottom 40% group registered a higher mean income growth of 11.9%.
Jala remarked: “However, our efforts to narrow the income divide between the rich and the poor must continue in line with our objective to ensure inclusive economic growth.”
Steady GDP growth
He also noted that Malaysia has been on a steady gross domestic growth (GDP) growth path since the start of ETP amidst low inflation rates. “GDP came in at 7.4% in 2010 due to front-loading of economic stimulus and since 2011, growth has been trending within a respectable band of 4% to 6%.”
Jala said: “Bolstered by strong domestic demand, we achieved a formidable 6% GDP growth in 2014, extending beyond the expectations of economists as well as the World Bank which forecast a 5.7% GDP growth for the year.
“Against a landscape where advanced economies continue to struggle for growth and GDP of the global economy has not touched 4% since 2007, Malaysia is in an enviable position indeed,” he said.
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