Economic Transformation Programme
A Roadmap For Malaysia
Chapter 1: New Economic
Model of Malaysia
alaysia has achieved signifcant economic and social progress over the past several decades.
However, the world economy is changing, and Malaysia needs a Fundamentally new economic
model in order to become a high-income nation. Our historical growth engines are slowing,
we risk being caught in a middle-income trap, our fscal position is arguably unsustainable while
global competition For markets, capital and talent is increasingly intense. In response, the Economic
TransFormation Programme (ETP) represents a marked change in approach that builds on the Tenth
Malaysia Plan and input From the National Economic Advisory Council (NEAC). The ETP Focuses on key
growth engines or National Key Economic Areas (NKEAs). It relies heavily on private sector-led growth,
describes very specifc investments and policy actions and has a clear transparent implementation roadmap
with strong perFormance management.
MALAYSIA HAS MADE SIGNIFICANT PROGRESS
Sustained rapid economic growth has raised Malaysia From an agricultural and commodity-based
low-income economy to a successFul middle-income economy. Our story oF moving From low-to
middle-income status is one oF the world’s success stories oF the past Few decades. Since 1945, Malaysia
is one oF only 13 countries
to have sustained growth oF over 7 percent or more For 25 years.
This strong economic perFormance has helped improve the quality oF liFe For Malaysians and supported
advances in education, health, inFrastructure, housing and public amenities, some oF which are shown in
Growth has also been accompanied by a near-eradication oF hardcore poverty, which Fell From 6.9 percent
in 1984 to 0.9 percent in 2010. Primary school enrolment is now nearly universal. Basic healthcare has
improved in the past two decades with liFe expectancy rising and inFant mortality rates Falling signifcantly.
As a result, Malaysia’s score in the United Nations Human Development Index rose From 0.67 in 1980 to
0.83 in 2007, surpassing the 0.8 score benchmark For countries with high standards oF human development.
The 13 countries are Botswana, Brazil, China, Hong Kong SAR, Indonesia, Japan, Republic of Korea, Malaysia, Malta, Oman, Singapore,
Taiwan and Thailand