Thursday, 8 September 2016

Ecosystem sustainability key to economic prosperity


It is common that in uncertain economic times, there will be discussions and debates on the robustness of the economy and the future.
The fear of the unknown ahead naturally triggers the popularity  of polemic-based analysis towards economic administration during downward trends in the economic cycle.
The old adage that "to predict the future, we must look at history" becomes a relevant mind set in these times.
Throughout our history, Malaysia has survived numerous economic downturns.
Despite three major crises in recent decades, our economy had shown an overall upward trend over the last 40 years, recording a gross domestsic product of US$9.3 billion (RM37.8 billion) to US$296 billion in 1975 and 2015, respectively.
Interestingly, the gross domestic product increase was most rapid after the materialisation of the nation's industrialisation agenda, rising from US$72 billion in 1998 and continuing its rapid upward trend to what we see today.
Furthermore, our gross national income (GNI) per capita rose from US$3,420 in 2000 to US$10,600 last year - which is close to the World Bank's technical definition of a high income nation (US$12,475).
The key factor for economic prosperity is the sustainability of the business ecosystem.
Malaysia has enjoyed an 18-year trade surplus, at RM94.3 billion last year, with a total trade value of RM1.47 trillion.
This has created career enhancement for employees, better livelihood for families and increased government revenue that further strengthens the structural value of the business and social ecosystem.
Administrative costs, such as government expenditure and natioal debt may be argued as indicators towards future economic trends.
Despite its convenient polemic use, these figures do not often paint a holistic picture of the current state of the nation .
For example, higher government expenditure and sovereign debt may indicate increased efforts to stimulate the economy, and not reduce cost efficiency.
When the business ecosystem faces difficult times, it becomes strategic and natural for governments to play a more active role in business facilitation as this not only keeps businesses afloat, but also helps maintain stability of government income streams.
It is imperative to realise that Malaysia has come a long way since it moved from a commodity-based economy in the 1970s to what is wants to be in the future - an industrialised nation with high value income.
As we move closer to our 2020 deadline, the next key agenda is to enhance our exports growth by introducing more competitive, high value products and services into the global market.
The National Export Council, chaired by the Prime Minister, was set up to formulate strategies and measures to boost Malaysia's exports.
With respect to the automotive industry, the Automotive Export Enhancement Programme was introduced with the aim of exporting 150,000 vehicles by 2020, along with more than RM9 billion worth ox exports of new and remanufactured automotive parts and components.
This economic goal is meant for all Malaysians - to ensure that all of us participate in an economic growth that encompasses not just higher revenue, but higher value employment, localisation of industry as well as expansionof the market through exports.
In conclusion, it is important to realise that economic prosperity fluctuates in cycles, but holding the course and the strong belief in the industrialisation agenda is key to achieving such prosperity.
"A smooth sea will never make a skilful sailor"

The writer is chief executive officer of Malaysia Automotive Institute

No comments:

Post a Comment