Every year the World Bank conducts a comprehensive and expert study into the ease of doing business across the globe and it has just released its figures for 2012, which show Malaysia strengthening its position and entering the top 20 – food for thought for those who are constantly knocking our performance.
We have moved from 23rd in the world last year (2011 index) to 18th this year (2012 index). Of course we have more work to do, but I think this shows just how the hard work of so many Malaysians to make our country a better place to live in is paying off.
Looking at the details of the World Bank’s index we can see we have made solid progress on making it easier to start a business and we hold equal first rank in the world when it comes to the ease of business getting credit. More than that, the World Bank says that we are the world’s top performer in keeping the costs of imports down – something that is vital given the real pressures on people’s costs of living.
Where do we go from here? Well, the Budget was a deliberate step towards strengthening our economy and creating a climate where foreign investors will actively look to Malaysia as a regional or even global hub.
Domestically, we need to develop and implement best practices that will ensure long-term growth. As best practices are often developed through innovation, creative thinking and increased productivity, this is the route we must take. We must embrace out-of-the-box thinking and explore non-conventional solutions to problems. We must seek sustainable ways to increase output, maximise resources, and reduce wastage, and we must do so creatively. Innovation and creativity fuel the growth of industry leaders and strong economies; we must follow suit.
The Budget I unveiled in Parliament last month targeted Malaysian innovators for help – such as greater tax incentives for pioneers in Islamic finance, an area where we are already a world leader but where we can achieve much more. It also pledged significant additional funds for rural development – because every road we build, every port we dredge opens up new trading opportunities for Malaysians.
The Budget was based on the values of 1Malaysia – that economic growth and progress should be for the benefit of all Malaysians. Our economy is strong and that means we can help those in our society who are not so strong and who are finding things tough.
My Budget also involves some fiscal tightening, using economic growth to lower the overall level of borrowing. But I am also certain we must not cut borrowing too far and too fast because if we do we risk plunging our economy into stagnation or recession and that would mean the poor paying the highest cost of all.
Keeping our economy on track means strengthening the private sector and giving entrepreneurs more opportunity – especially in our rural areas. We can do that in two ways.
Firstly, by the reforms we are and will continue to make, including my recent announcements of reforms of the civil service, and by giving a hand up to those who want to achieve, which is why it gave additional help to students of all ages as well as opening up new sectors of the service economy – including engineering, legal services and telecoms to foreign investment: Malaysian entrepreneurs should be able to compete for funds globally and I give them every encouragement to do so.
Secondly, we can strengthen our private sector by attracting more foreign investment. Foreign investment pays for modernisation and growth and helps integrate Malaysia’s economy ever more closely with the developed world. It increases competition and so helps keep prices low. It drives innovation and so increases skill levels in Malaysia and makes Malaysian jobs in export-facing sectors more secure.
As Malaysians we all share a responsibility not to take risks with our future. While I cannot promise to solve the crisis the Eurozone any more than I can stop flooding in Thailand, I can promise that whatever I do, it will be conscientiously done to avoid risking our economic stability.