In October 2019, the federal government of Malaysia launched the Shared Prosperity Vision 2030 (Wawasan Kemakmuran Bersama 2030) that outlined the Government’s strategy and goal for the next 10 years.
What is Shared Prosperity Vision 2030?
The Shared Prosperity Vision 2030 (SPV 2030) is the Government commitment to make Malaysia a nation that achieves sustainable growth along with fair and equitable distribution, across income groups, ethnicities, regions and supply chains. The commitment is aimed at strengthening political stability, enhancing the nation’s prosperity and ensuring that the rakyat are united whilst celebrating ethnic and cultural diversity as the foundation of the nation state.
The document outlined the Government’s strategies to change its economic model and restructure the business ecosystem as well as to strengthen the existing policies and plans. The Shared Prosperity Vision covers three primary objectives:
Situational Analysis
The SPV 2030 highlighted a number of issues that have happened to Malaysia’s socioeconomic structure:
- Economic growth has yet to reach its full potential;
- Diversity of products and services has yet to reach an optimum level and the reliance on commodity-based exports is relatively high;
- Most industries are still in the low value-added category with low technology adoption;
- Compensation of Employees (CE) to GDP is still low;
- Disparity still exists between income groups, ethnic groups and regions;
- The existence of unfair competition issues in the market as a result of monopoly and profiteering practices;
- Symptoms of corruption and abuse of power affect fair and equitable economic growth and distribution; and
- Bumiputera economy has not grown in line with the country’s development and progress.
The Strategy
The Shared Prosperity Vision outlined 3 objectives, 15 guiding principles, 7 strategic thrusts and 8 enablers to realise the desired goals.
3 objectives, 15 guiding principles
7 strategic thrusts
8 enablers
What is KEGA?
Sectors with potential to grow faster need to be identified to drive future economic development. With these sectors in place, the Government’s efforts to boost economic growth will be implemented through a centralised initiative, thus developing an ecosystem throughout the supply chain. The proposed Key Economic Growth Activities (KEGA) will not disregard the development of existing economic activities such as oil and gas, manufacturing, electrical and electronic goods and other services. A total of 15 KEGA proposals have been identified for development.
KEGA is defined as a future economic activity that demonstrates the potential for rapid growth in line with the country’s aspiration to achieve high value economic development. The selected KEGA will be a new priority with emphasis on generating significant growth and contributing to GNI in the future. KEGA activities will improve over time, depending on the performance of each activity. The evaluation process will be implemented to ensure that each selected activity is competitive and sustainable. To date, a total of 15 KEGA activities have been selected as follows:
What is Polarity Management?
In line with the concept of equality underlying Shared Prosperity Vision 2030, certain groups will be given priority, in order to improve their socioeconomic status and to ensure that no one is left behind.
Polarity management is a model of managing issues faced by the minority and specific target groups. The management of polarities is important to ensure issues that are raised can be handled effectively without jeopardising national harmony. In developing a polarity management model under Shared Prosperity Vision, several key target groups have been identified:
So … What are the targets?
Shared Prosperity Vision is an outcome-based approach focusing on the country’s achievements beyond the economy. It is a holistic vision that encompasses all aspects of development including infrastructure, economy, government delivery system, environment, societal values and education. All targets that will be used as Shared Prosperity Vision outcome-based indicators will be matched with future strategies. The process of implementing, monitoring and measuring key indicators of the vision will be undertaken through the creation of a detailed and dynamic dashboard. These will be driven by 10 key targets and over 40 outcome-based targets with 10 initial targets identified as follows:
What do people think about SPV 2030?
Since the announcement of SPV 2030, various organizations have given their view with respect to the new national plan.
“The main objective of SPV 2030 is to prepare a decent standard of living for all Malaysians by 2030 in line with the United Nations Agenda 2030 to reach Sustainable Development Goals which are inclusive, leaving no one behind. Private sector is a very important thing (in SPV 2030). The private sector should play their role. For now, it is only the government (playing the role).”
Tun Dr Mahathir Mohamad, Prime Minister
“This vision is a manifest of Pakatan Harapan’s desire to implement justice and fairness that covers all races, income class and region. The SPV 2030 is launched at the perfect time, especially with the uncertain economic climate that is happening globally.
This vision will provide the turbo charge needed to spur a sustainable economic growth. This in turn will elevate us into a high-income economy and also increase the people’s purchasing power,”
Datuk Seri Azmin Ali, Economic Affairs Minister
“The SPV 2030, in our view, is a sound plan. So far, it provides a general strategy for future economic planning, but stops short on the methods to do so,”
RHB Investment Bank Bhd
“While the approach of tapping into new sources of growth and adopting a niche-based planning for development at the state-level is commendable, it could observe some redundancy in the new sectors listed and we foresee further fine tuning is required for the distribution list, for example, digital economy and industrial revolution 4.0 are those that overlap each other and which may pose hurdles and result in inefficient usage of resources when executing the development plan. ”
Kenanga Research (research arm of Kenanga Investment Bank Bhd)
Our view:
Wawasan Kemakmuran Bersama (WKB2030) or Shared Prosperity Vision 2030 (SPV2030) is an exciting and comprehensive policy document that captures the essence of some of the most important economic aspirations that Malaysia should strive towards.
Moving forward, it is vital that this document is followed through with clear targets and indicators that allow us to achieve the targets stipulated in this document, as well as strong policy implementation that brings in investments in areas such as physical, digital and infrastructure projects. This is an area that policymakers must work towards. – Girish Ramachandran, Executive Director, 27 Group
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