In this webinar, Dr Tham Siew Yean, Professor VGR Chandran and Mr Lee Heng Guie analysed Malaysia’s New Industrial Master Plan 2030.
REGIONAL ECONOMIC STUDIES PROGRAMME AND MALAYSIA STUDIES PROGRAMME WEBINAR
Friday, 22 September 2023 – The New Industrial Master Plan 2030 (NIMP 2030) was officially launched by the Malaysian government to chart the strategic direction of the country’s manufacturing sector for the next seven years. To discuss the major underpinnings of the plan and critically assess its goals, scope and strategies, the Regional Economic Studies and Malaysia Studies Programmes of the ISEAS – Yusof Ishak Institute jointly organised a webinar featuring Dr Tham Siew Yean, Professor Emeritus at Universiti Kebangsaan Malaysia; Dr VGR Chandran, Professor of Industrial Development at the University of Malaya; and Mr Lee Heng Guie, Executive Director of Malaysia’s Socio-Economic Research Centre (SERC). The speakers offered key insights on how NIMP 2030 lays out a broad policy framework that will serve as a policy guide for Malaysia’s long-term industrial development.
Following a brief introduction by Dr Cassey Lee, Senior Fellow at ISEAS, Prof Tham began her presentation by sharing the six key goals of NIMP 2023: 1) focusing on increasing industries’ economic complexity; 2) strengthening industrial clusters; 3) increasing the income and skills of workers; 4) more balanced development across states; 5) stronger domestic linkages; and 6) sustainable development. The plan, she said, differs from its predecessor in the use of specific mission-based projects (MBPs) to catalyse each mission. However, Malaysian policymakers will have to overcome challenges related to the plan’s implementation, the underlying fiscal support needed, and the possibility of NIMP crowding out domestic and foreign investments.
Carrying the discussion forward, Prof Chandran claimed that the plan is not only ambitious but also objectively better than the previously launched Third Industrial Master Plan (IMP3). It critically recognises the primary causes of market failures and the weaknesses of earlier government strategies on industrial development and offers constructive guidance on implementation and governance by taking a more selective and targeted approach. The seven-year timeline of the plan, however, could be short-sighted, Prof Chandran argued. Nevertheless, for NIMP 2023 to be successful, a ‘whole of nation’ approach is needed; policymakers must be mindful of the budget and resources that can be allocated to the plan and employ a collaborative implementation technique that brings together all the relevant government agencies.
Mr Lee opined that, while NIMP 2023 is a well-defined plan for setting new strategies for Malaysia’s manufacturing industry transformation in the green industrial age, accountability and responsibility are critical to ensure the successful implementation of the mission-based projects. In doing so, putting in place a public-private governance system with the highest level of support is paramount. Mr Lee also suggested that the plan must also be accompanied by an advocacy campaign to increase industry utilisation of FTAs such as the RCEP and CPTPP. Likewise, accelerated transition towards sustainable practices would help achieve the plan’s goal ahead of the pre-set deadlines. He concluded his presentation by emphasising the importance of strengthening industrial clusters as a means for swift implementation of NIMP.
The 90-minute webinar was attended by an audience composed of research scholars, students, policymakers and the general public. The speakers also answered their questions on an array of topics, including the importance of effective communication between the state and the private sector, the challenge of limited developmental budget of the Ministry of Investment, Trade and Industry, long-term plans to overcome the growing problem of skill shortages in Malaysia, and the advantageous role of regional trade agreements.