Services will account for a much greater share of the

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Unformatted text preview: he Malaysian economy will have changed significantly as can be seen in Exhibit 2-6. • Services will account for a much greater share of the economy. By 2020, services will account for 65 percent of GDP, up from 58 percent in 2010. This growth will be concentrated in the Financial Services, Wholesale and Retail, Business Services, Tourism, Healthcare and Education NKEAs. As an example, in the Healthcare NKEA, annual growth of 10 percent is targetted in areas including health travel, spet care centres and assisted living; and • Domestic consumption will be a key driver of growth. Domestic consumption will account for 59 percent of GDP by 2020, compared to 54 percent in 2010. This will be partly a result of growth in sectors including wholesale and retail, financial services and healthcare services as well as growing urbanisation. This is especially important because it means that Malaysia will reduce its reliance on exports as a driver of demand. This growth in domestic demand would bring Malaysia in line with developed economies like Taiwan and New Zealand. Economic Transformation Programme 83 A Roadmap For Malaysia Exhibit 2-6 As well as a change in structure, Malaysia’s economy will become more balanced and less dependent on resource-intensive industries. In particular, the petroleum industry’s share of GDP will fall from 21 percent in the year 2008 to 14 percent in 2020. A more balanced and diversified economy should help ensure that growth will be sustainable over the long term. As a result of the EPPs and the NKEAs, Malaysia will also become a more urbanised country. We estimated that the share of the population living in urban areas will grow from 64 percent to 70 percent and much of this growth will be concentrated in Greater Kuala Lumpur/Klang Valley. This will provide many new job opportunities for Malaysians, and the expectation is that some Malaysians from urban and rural areas will migrate in order to participate in these opportunities. While Greater Kuala Lumpur/Klang Valley will be a primary engine of economic growth, there will be growth opportunities right across Malaysia. These include the development of the solar industry in Sarawak, the development of a global biodiversity hub to attract more tourists to Sabah and the commeration of paddy farming and improvements in yields within palm oil. The state-by-state coverage of the proposed EPPs is laid out in Exhibit 2-7. 84 Chapter 2 Overview of the Economic Transformation Programme Exhibit 2-7 By 2020 Malaysia will also have grown a number of new national and regional champions. These companies will drive long-term growth in areas including financial services, business services and healthcare services. Finally, small- and medium-sized enterprises (SMEs) will play a more significant role across the economy. For instance, in education, agriculture, electronics and electrical and palm oil sectors, SME participation will be actively encouraged through the provision of financial support and be...
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This note was uploaded on 02/24/2014 for the course ACCOUNTING financial taught by Professor Alan during the Spring '14 term at Howard.

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