Malaysia set to become a ‘high-income nation’ by 2020
Malaysia’s government has said that its development goals are on track to become a high-income nation by 2020.
Malaysia’s goal to become a high-income nation by the start of the next decade is still looking achievable, according to a report published by the government on the progress of its Economic Transformation Programme (ETP).
Figures show that the gross national income per capita of the country stood at $10,060 (£5,974) last year. It’s edging closer to the target of $15,000 by 2020, and nearer still to the figure of $12,616 which the World Bank uses to determine whether a country can be classed as “high-income”.
With a total of 161.1 billion ringgit (£29.5 billion) in private investments over 2013, eight per cent above target, capital is flowing into and around the country’s economy. Some of this is picking up the slack left as the government slowly removes many subsidies. Bloomberg reports that when Fitch Ratings cut Malaysia’s credit outlook last summer, it said these subsidies posed fiscal risks which politicians are now trying to eliminate.
Still, the amount of investments that were pledged plummeted by 75 per cent to eight billion ringgit, and the ETP is a long way from its aim of generating 92 per cent of investment from the private sector. Some critics are arguing that the success of the plan is being exaggerated by the government, but Malaysia’s leaders are still optimistic that future targets will be met.
Growth stood at 4.7 per cent last year for the Malaysian economy overall, and analysts expect this to grow again thanks to major projects like a new railway being developed in Kuala Lumpur. As income rises, domestic consumption is also increasing and the nation is now home to a growing middle class with high expectations for the future.
“What has heartened me the most about the ETP has been its ability to improve the people’s quality of life, whether through projects which are focused on uplifting local communities or through big ticket initiatives such as the construction of the Mass Rapid Transit system in the Greater Kuala Lumpur/Klang Valley NKEA,” said prime minister Datuk Seri Najib Razak, according to the Malaysia Chronicle.