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Encyclopedia > Malaysian New Economic Policy
Under the Malaysian New Economic Policy, Bumiputras are given discounts on real estate.
Under the Malaysian New Economic Policy, Bumiputras are given discounts on real estate.
This article is part of
the History of Malaysia series.

Prehistoric Malaysia (60,000–2,000 BCE)
Gangga Negara (2nd–11th century CE)
Langkasuka (2nd–14th century)
Pan Pan (3rd–5th century)
Srivijaya (3rd–14th century)
Kedah Sultanate (1136–present)
Malacca Sultanate (1402–1511)
Portuguese Malacca (1511 - 1641)
Dutch Malacca (1641 - 1824)
Sulu Sultanate (1450–1899)
Johor Sultanate (1528–current)
Jementah Civil War (1879)
White Rajahs (1841–1946)
British Malaya (1874–1946)
Anglo-Dutch Treaty of 1824
Burney Treaty (1826)
Straits Settlements (1826–1946)
Larut War (1861–1874)
Klang War (1867–1874)
Pangkor Treaty of 1874
Federated Malay States (1895–1946)
Unfederated Malay States (19th century–1946)
Anglo-Siamese Treaty of 1909
Battle of Penang (1914)
North Borneo (1882–1963)
Mat Salleh Rebellion (1896–1900)
World War II (1941–1945)
Battle of Malaya (1941–42)
Parit Sulong Massacre (1942)
Battle of Muar (1942)
Battle of Singapore (1942)
Syburi (1942–1945)
Battle of North Borneo (1945)
Sandakan Death Marches (1945)
Malayan Union (1946–1948)
Federation of Malaya (1948–1963)
Malayan Emergency (1948–1960)
Bukit Kepong Incident (1950)
Independence Day (1957)
Federation of Malaysia (1963–present)
Operation Coldstore (1963)
Indonesia-Malaysia confrontation (1962–1966)
Brunei Revolt (1962–1966)
Singapore in Malaysia (1963–1965)
1964 Race Riots (1964)
Communist Insurgency War (1967-1989)
May 13 Incident (1969)
New Economic Policy (1971–1990)
Operation Lalang (1987)
1988 Malaysian constitutional crisis (1987–88)
Asian financial crisis (1997–98)
[edit this box]
For the Soviet New Economic Policy, see New Economic Policy.

The Malaysian New Economic Policy (NEP or DEB for Dasar Ekonomi Baru in Malay) was an ambitious and controversial socio-economic restructuring affirmative action program launched by the Malaysian government in 1971 under then Prime Minister Tun Abdul Razak. The NEP ended in 1990, and was succeeded by the National Development Policy in 1991. Although the NEP was hailed in some quarters as having reduced the socioeconomic disparity between the Chinese minority and Malay majority, others accused it of having reduced non-Malays to the status of second-class citizens by cementing ketuanan Melayu (Malay supremacy). The NEP is often invoked as part of the Malay Agenda, which is in turn part of the Malaysian social contract granting Malays special rights in return for non-Malay citizenship. Image File history File links Download high resolution version (1200x900, 168 KB) Summary This is a modified composite of two photographs of a real estate advertisement in the New Straits Times January 21, 2006 edition, page 27. ... Bumiputra or Bumiputera (Malay, from Sanskrit Bhumiputra; translated literally, it means son of the soil), is an official definition widely used in Malaysia, embracing ethnic Malays as well as other indigenous ethnic groups such as the Orang Asli in Peninsular Malaysia and the tribal peoples in Sabah and Sarawak. ... The history of Malaysia is a relatively recent offshoot of the history of the wider Malay-Indonesian world. ... Image File history File links History_merdeka. ... Caves paintings of Tambun, dated 3000 BC, in Ipoh, Perak, Malaysia. ... The Common Era is the period beginning with a year near the birth of Jesus, coinciding with the period from AD 1 onwards. ... Gangga Negara was believed to be a lost Hindu kingdom somewhere in the state of Perak, Malaysia. ... “Era Vulgaris” redirects here. ... Langkasuka (-langkha Sanskrit for resplendent land -sukkha of bliss) was apparently the oldest kingdom on the Malay peninsula. ... A call of pan-pan is a very urgent message concerning the safety of a ship, aircraft or other vehicle, or persons on board who require immediate assistance. ... Map of Southeast Asia at end of 12th century. ... This article or section needs copy editing for grammar, style, cohesion, tone and/or spelling. ... This article or section does not adequately cite its references or sources. ... Portuguese Malacca Capital Malacca Town Language(s) Portuguese, Malay Political structure Colony King  - 1511-1521 Manuel I  - 1640-1641 John IV Captains-major  - 1512-1514 Ruí de Brito Patalim (first)  - 1638-1641 Manuel de Sousa Coutinho (last) Captains-general  - 1616-1635 António Pinto da Fonseca (first)  - 1637-1641 Lu... Dutch Malacca Capital Malacca Town Language(s) Dutch, Malay Political structure Colony Governor  - 1641 - 1642 Jan van Twist  - 1824 - 1825 Hendrik S. van Son British Residents  - 1795 Archibald Brown  - 1803 - 1818 William Farquhar Historical era Imperialism  - Established 14 January, 1641  - British occupation 1795-1818  - Anglo-Dutch Treaty 17 March, 1824... For the province, see Sulu Location of Sulu in the Philippines Capital Jolo Language(s) Arabic (official), Tausug, Malay, Banguingui, Bajau languages Religion Islam Government Monarchy Sultan  - 1450-1480 Shariful Hashem Syed Abu Bakr  - 1884-1899 Jamal ul-Kiram I History  - Established 1450  - Annexed by USA 1899 The Sultanate... This article or section does not cite its references or sources. ... Jementah Civil War happened in 1879 in Jementah, Sultanate of Johor when Tengku Alam, the heir of Sultan Ali of Muar refused to give the district of Muar under temporary administration of Sultan Abu Bakar of Johor. ... The White Rajahs refer to a dynasty that founded and ruled the Kingdom of Sarawak from 1841 to 1946. ... British Malaya was a set of states that were colonized by the British from the 18th and the 19th until the 20th century. ... The Anglo-Dutch Treaty of 1824, also known as the Treaty of London (one of several), was a treaty signed between the United Kingdom and the United Kingdom of the Netherlands in London on March 17, 1824. ... The Burney Treaty was a treaty signed between Siam and the British in 1826. ... The Straits Settlements were a collection of territories of the British East India Company in Southeast Asia, which were given collective administration in 1826. ... Larut War was a series of four wars started in July 1861 and ended with the signing of the Pangkor Treaty of 1874. ... The Klang War or Selangor Civil War took place in the Malay state of Selangor and was fought between Raja Abdullah bin Raja Jaafar, the administrator of Klang and Raja Mahadi bin Raja Sulaiman from 1867 to 1874. ... The Pangkor Treaty of 1874 was a treaty signed between the British and the Sultan of Perak. ... The Federated Malay States (FMS) was a federation of four states on the Malay Peninsula - Pahang, Perak, Selangor, and Negeri Sembilan - established by the British government in 1895, and lasted until 1946, when they together with the Straits Settlements and the Unfederated Malay States formed the Malayan Union. ... The Unfederated Malay States were five Malay states, namely Johore Terengganu Kelantan Kedah Perlis Together the states were not a single entity but merely a category to describe those states which were not Federated Malay States or Straits Settlements. ... The Anglo-Siamese Treaty of 1906 (in which the Malays were not represented) effectively dissected the northern Malay states into two parts: Pattani, Narathiwat, Songkhla, Satun and Yala remained under Siam, but Siam relinquished its claims to sovereignty over Kedah, Kelantan, Perlis, and Terengganu to Great Britain. ... The Battle of Penang occured in 1914, during World War I. It was a naval action. ... Motto: Pergo et Perago (Latin: I undertake and I achieve”) British North Borneo Capital Jesselton Language(s) Malay, English Government Monarchy Monarch  - 1882 - 1901 Victoria  - 1952 - 1963 Elizabeth II Governor  - 1896 - 1901 Robert Scott Historical era New Imperialism  - North Borneo Company May, 1882  - British protectorate 1888  - Japanese invasion January 1... Mat Salleh Rebellion was a series of major disturbances in North Borneo, now Malaysian state of Sabah, from 1894 to 1900. ... Throughout much of the Second World War, British Malaya, North Borneo and Sarawak were under Japanese occupation. ... Combatants Malaya Command: British Army Indian Army Australian Army Royal Malay Regiment Twenty-Fifth Army: Imperial Guards 5th Division 18th Division Commanders Arthur Percival Gordon Bennett Tomoyuki Yamashita Takuma Nishimura Strength 140,000 160 aircraft 70,000 700 aircraft Casualties 5,000 killed, 50,000 prisoners of war 34,000... Parit Sulong is a small village in Johor, Malaysia on the Simpang Kiri River, 30 km east of Muar. ... Combatants Australian 8th Division Indian III Corps 53rd British Infantry Brigade Royal Air Force Imperial Guards Division IJA Commanders Gordon Bennett Charles Anderson H. C. Duncan â€  Black Jack Galleghan Takuma Nishimura Strength 4000 Infantry 60 aircraft Several Thousand Infantry 400 aircraft Casualties Large number killed or wounded (+200 POWs executed... Combatants Malaya Command: Indian III Corps Australian 8th Div. ... During the Japanese Occupation of Malaya, control of the State of Kedah was given to Thailand by the Japanese. ... The Battle of North Borneo was fought from June 17 to August 15 of 1945 between Australia and Japan. ... October 24, 1945. ... The Malayan Union was formed on April 1, 1946 by the British. ... The Federation of Malaya, or in Malay Persekutuan Tanah Melayu, was formed in 1948 from the British settlements of Penang and Malacca and the nine Malay states and replaced the Malayan Union. ... The Malayan Emergency was an insurrection and guerrilla war of the Malay Races Liberation Army against the British and Malayan administration from 1948-1960 in what is now Malaysia. ... Combatants Malayan Races Liberation Army or Malayan Communist Party Malayan Police Commanders Muhammad Indera Sgt Jamil Mohd Shah Strength 200 25 Casualties about 40 dead 25 dead including non-combatants Bukit Kepong Incident was a historic armed encounter which took place on the February 23, 1950 between the police and... Hari Merdeka (Independence Day) is a national day of Malaysia commemorating the independence of the Federation of Malaya from British colonial rule. ... Motto Anthem Negaraku Capital Kuala Lumpur3 Largest city Kuala Lumpur Official languages Malay2 Government Federal constitutional monarchy  -  Yang di-Pertuan Agong Mizan Zainal Abidin  -  Prime Minister Abdullah Ahmad Badawi Independence  -  from the United Kingdom (Malaya only) August 31, 1957   -  Federation (with Sabah, Sarawak and Singapore4) September 16, 1963  Area  -  Total... In February 1963, the government of Singapore conducted a security operation, named Operation Coldstore (sometimes spelled Operation Cold Store), and arrested at least 107 left-wing politicians and trade unionists. ... The Indonesia-Malaysia confrontation was an intermittent war over the future of the island of Borneo, between British-backed Malaysia and Indonesia in 1962–1966. ... Combatants United Kingdom Australia New Zealand Malaya Brunei Parti Rakyat Brunei Indonesia Commanders General Sir Nigel Poett Yassin Affandi Strength  ?  ? Casualties  ?  ? The Brunei Revolt broke out on December 8, 1962 and was led by Yassin Affandi and his armed rebels. ... On 16 September 1963, Singapore joined the Federation of Malaya together with Sabah and Sarawak to form Malaysia. ... The start of the July riot on Prophet Muhammads birthday, that would later injure hundreds and kill 23 people. ... Combatants Malaysian Federal Government Malaysian Army Royal Malay Regiment Royal Ranger Regiment Royal Malaysian Air Force Royal Malaysian Police Malayan Communist Party Commanders Abdullah CD (Che Anjang Abdullah) - CPM leader Chin Peng - Secretary general Ah Sek (Ah Sze) Casualties Civilian casualties: The Communist Insurgency War or Second Malayan Emergency was... The May 13 Incident saw numerous cases of arson in the Malaysian capital city of Kuala Lumpur. ... Operation Lalang (or in English, Weeding Operation; also referred to as Ops Lallang) was carried out on 27 October 1987 by the Malaysian police to crackdown on opposition leaders and social activists. ... The Sultan Abdul Samad Building housed the Supreme Court at the time of the 1988 Malaysian constitutional crisis. ... The Asian financial crisis was a financial crisis that started in July 1997 in Thailand and affected currencies, stock markets, and other asset prices in several Asian countries, many considered East Asian Tigers. ... This article needs additional references or sources for verification. ... The Malay language (Malay: Bahasa Melayu; Jawi script: بهاس ملايو), is an Austronesian language spoken by the Malay people who reside in the Malay Peninsula, southern Thailand, the Philippines, Singapore, central eastern Sumatra, the Riau islands, parts of the coast of Borneo and even in the Netherlands[1]. It is an official... Socioeconomics is the study of the social and economic impacts of any product or service offering, market intervention or other activity on an economy as a whole and on the companies, organization and individuals who are its main economic actors. ... Affirmative action refers to policies intended to discriminate against white males and promote access to education or employment aimed at a historically socio-politically non-dominant group (typically, minorities or women). ... The Prime Minister of Malaysia (in Malay Perdana Menteri) is the indirectly elected head of government of Malaysia. ... Tun Abdul Razak bin Dato Hussein (1922-1976) was the second Prime Minister of Malaysia, ruling from 1970 to 1976. ... This article or section does not cite its references or sources. ... United Malays National Organisation (UMNO) Youth Chief Hishammuddin Hussein brandishing the kris (dagger), an action seen by some as a defence of ketuanan Melayu. ... In 2005, UMNO Youth Chief Hishamuddin Hussein brandished the Malay dagger (kris) in support of the Malay Agenda. ... The social contract in Malaysia refers to the agreement made by the countrys founding fathers in the Constitution. ...

The NEP's success is a subject of heated debate. The NEP targeted a 30% share of the economy for the Bumiputra, but according to official government statistics, the NEP did not succeed in reaching this target. Although the policy ended officially in 1990, Malaysians often refer to the NEP in the present tense because many of the tangible economic benefits it offered the Bumiputra are ongoing. In 2005, some politicians from the United Malays National Organisation (UMNO), the leading political party of the governing Barisan Nasional coalition, called for the restoration of the NEP as part of the New National Agenda (NNA). Bumiputra or Bumiputera (Malay, from Sanskrit Bhumiputra; translated literally, it means son of the soil), is an official definition widely used in Malaysia, embracing ethnic Malays as well as other indigenous ethnic groups such as the Orang Asli in Peninsular Malaysia and the tribal peoples in Sabah and Sarawak. ... The present tense is the tense (form of a verb) that is often used to express: Action at the present time A state of being A habitual action An occurrence in the near future An action that occurred in the past and continues up to the present There are two... Sang Saka Bangsa The United Malays National Organisation, or UMNO, (Malay: Pertubuhan Kebangsaan Melayu Bersatu), is the right-Wing and the largest political party in Malaysia and a founding member of the Barisan Nasional coalition, which has ruled the country uninterruptedly since its independence. ... Political parties Part of the Politics series Politics Portal This box:      A political party is a political organization that seeks to attain political power within a government, usually by participating in electoral campaigns. ... Barisan Nasional (National Front or BN) is a political coalition in Malaysia. ... The New National Agenda is a set of policies and objectives devised by the ruling UMNO of Malaysia as a fresh means to continue the Malaysian New Economic Policy under prime minister Abdullah Badawi. ...



During British colonial rule, Malays were sidelined by the British colonial, except for the malay elite and royal, the malay as weel as the Bumiputera where denied of their rights to have a proper education most of the malay in the rural area wherte condidered lucky if there're provided with a basic education system <reading and counting.As a result of this, they malays and bumiputera where stuck with their traditional economic avtivities such as farming and fishing.This eventually lead to the malays and bumiputera to be lacking behind in terms of their economic share even after the country achive its independent.right after the country achieve its independent more than 50 percent of the country's population wherte considered to be living underr the poverty line, and a vast majotity of this figure where the malays and bumiputera.

NEP Launch

In the wake of the riots, the government declared a state of national emergency, and Parliament was suspended. The government formed a National Operations Council (NOC), led by Tun Abdul Razak. The implementation of the NEP was one of the NOC's first decisions, and the plan had the stated goal of "eventually eradicat[ing] poverty...irrespective of race" through a "rapidly expanding economy", which would reduce the non-Malay share of the economy in relative terms, while increasing it in absolute terms. The net "losses" of the non-Malays would go to the Malays, who held just 1.5% of the economy at the time of the May 13 riots. In 1971, Parliament reconvened, and Tun Abdul Razak officially became Prime Minister. That same year, Tun Razak also announced the NEP, as well as some controversial amendments to the Sedition Act that prohibited discussion of repealing certain articles of the Constitution, including Article 153, even in the Houses of Parliament. The amendments passed, and remain in effect as of 2006. [1] The National Operations Council was an emergency administrative body which attempted to restore law and order in Malaysia during the race riots in 1967. ... The Malaysian Houses of Parliament in Kuala Lumpur. ...


The NEP had the stated goal of poverty eradication and economic restructuring so as to eliminate the identification of ethnicity with economic function. The initial target was to move the ratio of economic ownership in Malaysia from a 2.4:33:63 ratio of Bumiputra, Other Malaysian, Foreigner ownership to a 30:40:30 ration. This was to be done by redistributing the wealth to increase the ownership of enterprise by Bumiputras from the then 2.4% to 30% of the share of national wealth. The 30% target for Bumiputra equity was proposed by Ismail Abdul Rahman after the government was unable to come to a consensus on an appropriate policy goal.[2] Bumiputra or Bumiputera (Malay, from Sanskrit Bhumiputra; translated literally, it means son of the soil), is an official definition widely used in Malaysia, embracing ethnic Malays as well as other indigenous ethnic groups such as the Orang Asli in Peninsular Malaysia and the tribal peoples in Sabah and Sarawak. ... Tun Dr Ismail Abdul Rahman (November 4, 1915 - August 2, 1973) was a Malaysian politician. ...

Alongside this redistribution of wealth was the goal of increased economic growth, which was mainly in the form of ISI. This economic growth would allow the non-Bumiputra share of the economy to decrease, while permitting the growth of non-Bumiputra business interests in absolute terms. In some quarters, this was referred to as "expanding pie theory": the Bumiputra share of the pie would increase, without reducing the size of the non-Bumiputra slices of the pie. This theory was first enunciated in the Second Malaysia Plan. [3] Crop diversification was introduced during the Second Malaysia Plan, phasing out rubber in favour of oil palm. ...

In 1975 the government created incentives to expand large-scale manufacturing industries and energy-intensive industries, targeting these industries and building policies around them. The Heavy Industries Corporation of Malaysia (HICOM), for example, was formed in order to assist in the manufacture of pig-iron, aluminium die casting, pulp and paper, steel, cement, motorcycle and heavy engineering. At the same time, export incentives were initiated.


The abstract policies and goals of the NEP were implemented by the Second, Third, Fourth and Fifth Malaysia Plans. Crop diversification was introduced during the Second Malaysia Plan, phasing out rubber in favour of oil palm. ...

Some specific requirements were introduced to achieve the 30% Bumiputra equity target set by the NEP. Amongst these was a requirement that all initial public offerings (IPOs) set aside a 30% share for Bumiputra investors. These investors could be selected by the company being listed on the stock exchange, or the Ministry of International Trade and Industry, which would normally recommend such state-owned trust agencies as Permodalan Nasional or the Armed Forces pension fund. These shares were initially heavily discounted, as IPO prices were often significantly lower than prices after the listing had taken place. However, this advantage has disappeared in recent years. Nevertheless, this regulation has been criticised, especially as the 30% target continues to apply after the IPO has occurred; if the Bumiputra investors divest their shares, the company must issue new shares to maintain the proportion of Bumiputra shares above 30%.[4] An initial public offering (IPO) is the first sale of a corporations common shares to investors on a public stock exchange. ...


Wealth in the hands of the bumiputras went from 4% in 1970 to about 20% in 1997. The overall wealth of the country as a whole also grew; per capita GNP went from RM1,142 in 1970 to RM12,102 in 1997. During the same period, absolute poverty in the population as a whole dropped from 50% to 6.8%.[5] It is unclear what role the NEP played in these changes. Measures of national income and output are used in economics to estimate the value of goods and services produced in an economy. ...

NEP Benchmarks 1970 1990 2004
Bumiputra equity 2.4%
Overall poverty 52% 17.1% 5%
Rural poverty 59% 21.8% 11%
Household income RM660 RM1,254 RM2,996

The effects of the NEP on wealth distribution are disputed. The Gini index declined from 51.3 in 1970 to 44.6 in 1997, and 1987 figures indicated the mean income of the Malays had improved relative to both the Chinese and Indian communities.[5] However, some have used 1997 statistics with 70.2 percent of households in the bottom 40 percent income group as Bumiputra, and 62.7 percent of households in the top 20 percent income bracket as non-Bumiputra, to argue that inequities remain.[citation needed] The Gini index also began to increase in the 1990s, going from 44.6 to 46.4 between 1990 and 1995; meanwhile, 1997 figures indicated that Chinese incomes were increasing at a rate double that of Malays'. Intra-ethnic income differences also increased markedly, especially among Malays.[6] In addition, due to the dramatic government intervention, the NEP increased the national debt and economic inefficiencies.[citation needed] The Gini coefficient is a measure of inequality developed by the Italian statistician Corrado Gini and published in his 1912 paper Variabilità e mutabilità. It is usually used to measure income inequality, but can be used to measure any form of uneven distribution. ...

Bumiputra participation in the professions and private sector increased as well, although Bumiputras remain somewhat under-represented. Between 1970 and 1990, the Bumiputra share of accountants doubled from 7 to 14 per cent, engineers from 7 to 35 per cent, doctors from 4 per cent to 28 per cent, and architects from 4 to 24 per cent. The Bumiputra portion of the share market — a figure frequently cited as "a measurement of overall community wealth", despite claims that it was misleading — increased from 2 to 20 per cent over the same period according to one academic's measurements. The Chinese share also increased from 37 to 46 per cent, at the expense of foreign participation. Official Kuala Lumpur Stock Exchange figures from 1998 were even more optimistic, indicating Bumiputra share ownership stood at 28.6% in 1990 and 36.7% in 1996.[5][7] The Kuala Lumpur Stock Exchange (KLSE, Bursa Saham Kuala Lumpur in Malay) dates back to 1930 when the Singapore Stockbrokers Association was set up as a formal organisation dealing in securities in Malaya. ...

The Chinese community in Malaysia accepted the NEP as a necessary evil for cessation to Malay aggression. Furthermore, the Chinese community generally moved away from the public sector and set up businesses in the private sector, where the impact of the NEP was less pronounced [citation needed].

In spite of the policies implemented under the NEP, the share of the national wealth owned by the non-Bumiputra races increased beyond the 40% mark. This figure, however, does not reflect that certain segments of the non-bumiputra population live in dire poverty. The Malaysian Indian and Orang Asli in particular form the lowest strata of the population in terms of economic ownership. The Orang Asli of Peninsular Malaysia are not considered Bumiputra under the Federal Constitution despite their indigenous status (see Bumiputra for further information). Orang Asli is a general term used for any indigenous groups that are found in Peninsular Malaysia. ... Orang Asli is a general term used for any indigenous groups that are found in Peninsular Malaysia. ... Bumiputra or Bumiputera (Malay, from Sanskrit Bhumiputra; translated literally, it means son of the soil), is an official definition widely used in Malaysia, embracing ethnic Malays as well as other indigenous ethnic groups such as the Orang Asli in Peninsular Malaysia and the tribal peoples in Sabah and Sarawak. ...


In 2006, it was reported that the NEP would be reinstated under the Ninth Malaysia Plan, the ninth in a series of five-year economic plans. Originally, the NEP was replaced by the National Development Policy (NDP), which ran from 1990 to 2000. The NDP was supposed to have then been replaced by the National Vision Policy (NVP), which would reportedly have lessened the aggressive affirmative action of the NEP and NDP. However, UMNO later called for the NEP to be reinstated.[8] Ninth Malaysian Plan abbreviated as 9MP, is a comprehensive blueprint prepared by the Economic Planning Unit (EPU) of the Prime Ministers Department and the Finance Ministry of Malaysia with approval by the Cabinet of Malaysia to allocate the national budget from the year 2006 to 2010 to all economic... The National Development Policy replaced the Malaysian New Economic Policy in 1990 but continued to pursue most of NEP policies. ...


In recent years, the NEP has come under attack as being an inefficient system that promotes a laid-back attitude among the Bumiputras. Several policies of the NEP which give economic advantage to the Bumiputras, such as Bumiputra quotas in ownership of public company stock, and housing being sold exclusively to Bumiputras, are viewed as discriminatory.

Many of the NEP policies strive for equality of results rather than equality of opportunity, with NEP proponents justifying the concentration on results rather than opportunity as by pointing out that measuring equality of opportunity is difficult or impossible. When the NEP was implemented, for example, it was announced that one of its goals was to have 30% of all equity in Bumiputra hands.

NEP critics have argued that setting a target of 30% of Bumiputras trained and certified to run companies would represent a better equality in terms of opportunity. Still others suggest this target may not work as training and certification does not necessarily guarantee equality of opportunity. Tun Abdul Razak's predecessor as Prime Minister, Tunku Abdul Rahman, also opposed the 30% target, writing in the 1980s that "[a]n attempt was made to fill the target without thought for the ability and the capability of attaining it. ... Some became rich overnight while others became despicable Ali Babas and the country suffered economic set-backs". [9] Tunku Abdul Rahman Putra Al-Haj ibni Almarhum Sultan Abdul Hamid Shah (February 8, 1903–December 6, 1990) usually known as the Tunku (a princely title in Malaysia), and also called Bapa Kemerdekaan (Father of Independence) or Bapa Malaysia (Father of Malaysia), was Chief Minister of the Federation of Malaya... Ali Baba by Maxfield Parrish (1909). ...

The NEP is also criticised for not dealing directly with issues of wealth distribution and economic inequality; that it no longer helps the poor but is instead an institutionalized system of handouts for the largest ethnic community in Malaysia as the NEP does not discriminate based on economic class. Bumiputras of high and low economic standing are entitled to the same benefits. The statistical problems of categorising wealthy and disadvantaged Bumiputras in one group also meant that the NEP's goal of having 30% of the national wealth held by Bumiputras was not indicative of a median 60% of Bumiputras holding 28% of the national wealth, but could theoretically translate into one Bumiputra holding 29% of the national wealth, with the remaining Bumiputras sharing 1%. Some have alleged that because of this imbalance, some Malays such as those in Penang remain economically marginalised. Criticisms also arose from the fact that there was no planned assistance for Malaysian Chinese and Indian communities to achieve their 40% goal during the actual implementation of the NEP. State motto: Bersatu dan Setia (United and Loyal) State anthem: Untuk Negeri Kita (For Our State) Capital George Town Ruling party Barisan Nasional  - Yang Di-Pertua Negeri Abdul Rahman bin Haji Abbas  - Ketua Menteri Dr Koh Tsu Koon History    - Ceded by Kedah to British 11 August 1786   - Japanese occupation 1942...


Template:Education in Malaysia

The education policy of the NEP is one of the plan's more controversial points.

Bumiputras were accorded quotas for admission to public universities until 2002. These quotas were fixed, however, and in later years meant that the Bumiputra were allotted a significantly lower percentage of places originally intended, as the population figures used to calculate the quotas were based on 1970s numbers. Despite this, the quotas were still considered by many non-Bumiputra as unfairly rewarding the Bumiputra. The government removed these quotas in 2003. Also see: 2002 (number). ... 1970 (MCMLXX) was a common year starting on Thursday. ... Year 2003 (MMIII) was a common year starting on Wednesday of the Gregorian calendar. ...

The removal of the quotas has done little to remedy the perceptions of Bumiputra bias in the public tertiary education system. Most Bumiputras opt to enter a one year matriculation programme, which is considered by some to be less intensive than the two year Sijil Tinggi Pelajaran Malaysia (STPM) or Malaysian High Certificate of Education, which is equivalent to the British A-levels). Although the 'grade' standards required for admission are the same for both programmes, there is no moderation to ensure the difficulty of achieving a grade standard is the same between both programmes. The Malaysian High Certificate of Education is open to all races, but the Matriculation programme has a 10% quota for non-bumiputras. In practice significantly more Bumiputra enter the matriculation program, even after normalizing for ethnic demographics. The matriculation ceremony at Oxford Matriculation, in the broadest sense, means to be registered or added to a list, from the Latin matrix. ... The A-level, short for Advanced Level, is a General Certificate of Education qualification in the United Kingdom, usually taken by students during the optional final two years of secondary school (Years 12 & 13, commonly called the Sixth Form), or at a separate sixth form college or further education college...

These differences predate the removal of hard quotas. The difference in academic routes in fact begins in secondary school. Many Bumiputra enter public boarding secondary schools (sekolah asrama) whereas most non-Bumiputra remain in normal public secondary schools. The exams taken are the same until form 5 but then most Bumiputra go on to matriculation, whereas non-Bumiputra do STPM. However, even Bumiputra who remain in 'normal' secondary schools usually do matriculation instead of STPM. The lack of public transparency in grading of the papers contributed to this criticism.

The removal of quotas was largely reported to have resulted in an increase in the percentage of Bumiputra entering public universities. The perceived bias towards Bumiputras has meant that non-Bumiputra who can afford to do so choose to enter private colleges or to go overseas to further their education. There is a significant proportion of non-Bumiputra who do not enter into contention for admission to public universities.

Critics argue that this policy of the NEP has also contributed to a brain drain. Others suggest that the NEP has contributed to racial polarisation and a feeling of marginalisation among the non-Malays.[10] A brain drain or human capital flight is an emigration of trained and talented individuals (human capital) to other nations or jurisdictions, due to conflicts, lack of opportunity, health hazards where they are living, discrimination or other reasons. ... The examples and perspective in this article or section may not represent a worldwide view. ...

Changing mindsets

Some Bumiputras have spoken of reducing or eliminating the NEP; for example, Datuk Seri Abdullah Ahmad Badawi, Prime Minister of Malaysia, in his maiden speech as United Malays National Organization (UMNO) president to the UMNO general assembly in 2004 stated "Let's not use the crutches for support all the time, the knee will become weak". Badawi went on to state that continued usage of crutches would eventually result in needing a wheelchair instead. As of October 2004, Badawi has not addressed any significant concerns about the NEP. This article or section does not cite its references or sources. ... The United Malays National Organisation (UMNO), Pertubuhan Kebangsaan Melayu Bersatu in Malay, is the largest political party in Malaysia and a founding member of the Barisan Nasional coalition, which has ruled the country uninterrupted since independence. ... Year 2004 (MMIV) was a leap year starting on Thursday of the Gregorian calendar. ... This article does not cite any references or sources. ... Year 2004 (MMIV) was a leap year starting on Thursday of the Gregorian calendar. ...

Not all Bumiputra political leaders shared Badawi's views. For example, Badruddin Amiruldin, who was elected as UMNO's Deputy Permanent Chairman, waved a book about the 13 May incident at the assembly during his speech while declaring, "No other race has the right to question our privileges, our religion and our leader", continuing that any such action would be akin to "stirring up a hornet's nest". The following day, Dr. Pirdaus Ismail, an UMNO Youth Executive Committee member, stated, "Badruddin did not pose the question to all Chinese in the country. Those who are with us, who hold the same understanding as we do, were not our target. In defending Malay rights, we direct our voice at those who question them." Badruddin bin Amiruldin is a Member of Parliament in Malaysia who has had police reports filed against him for uttering racial slurs. ... is the 133rd day of the year (134th in leap years) in the Gregorian calendar. ...

Because of the controversy over affirmative action policies in Malaysia, especially the NEP, it has been feared that the NEP may indirectly contribute to a decrease in foreign investment. In 2005, foreign investment fell by USD4 billion, or 14% — a decrease some commentators attributed to the controversy over the government's ethnic policies.[11] The United States dollar is the official currency of the United States. ...

Equity calculation

The calculation of Bumiputra-held economic equity has been frequently disputed, with a number of allegations from some quarters that the government intentionally underestimated the share of Bumiputra equity to justify the NEP and its related policies. Although many affirmative action measures of the NEP were continued under the National Development Policy which ran from 1990 to 2000, and later by the National Vision Policy set to run from 2000 to 2010 — leading many Malaysians to refer to the NEP in the present tense — the official Bumiputra equity share remained less than the original 30% target.[12]

In 2006, a major dispute arose when the Asian Strategic and Leadership Institute (ASLI) issued a report calculating Bumiputra-held equity at 45% — a stark difference from the official figure of 18.9%. The report's publication triggered a relatively vocal public debate about the status of the NEP and its related policies, with many from UMNO questioning the methodology used by ASLI. One strongly disputed issue was ASLI's decision to consider government-linked companies (GLCs) as Bumiputra-owned, inflating the calculated figure of Bumiputra equity. Although ASLI later withdrew the report, citing unspecified errors in its methodology, the debate did not die down. One political analyst suggested that "If Bumiputra equity is 45 per cent, then surely the next question is, why the need for Bumiputera rights? It has implications for government policy and it (removing indigenous rights) is one thing UMNO will never accept at present." Others have argued that the debate over inter-ethnic disparities has obscured intra-ethnic inequities, citing the increased Gini coefficient for Bumiputras (from 0.433 in 1999 to 0.452 in 2004), Chinese (0.434 to 0.446) and Indians (0.413 to 0.425).[12] Graphical representation of the Gini coefficient The Gini coefficient is a measure of inequality of income distribution or inequality of wealth distribution. ...

A major point of dispute was the government's use of par value (as opposed to market value) of shares to calculate the equity held by Bumiputras. Many questioned the ASLI study on the basis that it had not used par value; conversely, others criticise the government for not using market value[1][2]. On another note, some critics later noted that a 1997 University of Malaya study had calculated the Bumiputra share of equity to stand at 33.7%, using par value.[13] Par value has several meanings depending on the context, whether used in the equities market, or in the bond markets, and partially also dependent on where in the world the par value term is used. ... Market capitalization, often abbreviated to market cap, mkt. ... The University of Malaya (or Universiti Malaya in Malay; commonly abbreviated as UM) is the oldest university in Malaysia, and is situated on a 750 acre (3. ...

At the UMNO General Assembly that year, Education Minister and UMNO Youth Chief Hishamuddin Hussein quoted a local study indicating that at current rates, it would take the Malays "120 years to achieve income parity". He also cited a 2004 statistic indicating that for every RM1 earned by a Malay, a Chinese earned RM1.64 as evidence that the income gap had not been eliminated. The Deputy Youth Chief, Khairy Jamaluddin, proposed increasing the target "quota" if non-Malays continued to allege that the 30% target had been met, as "By any yardstick, the Malays are still left behind".[14] Dato Seri Hishammuddin Bin Tun Hussein is a Malaysian politician and member of United Malays National Organization (UMNO). ... Ringgit (Malay for jagged) mostly refers to the Malaysian ringgit, which is the local currency in Malaysia, but it can also refer to the Singapore dollar and Brunei dollar in the Malay language. ... BN Deputy Youth Chief Khairy Jamaluddin on nomination day at Ijok. ...

See also

Bumiputra or Bumiputera (Malay, from Sanskrit Bhumiputra; translated literally, it means son of the soil), is an official definition widely used in Malaysia, embracing ethnic Malays as well as other indigenous ethnic groups such as the Orang Asli in Peninsular Malaysia and the tribal peoples in Sabah and Sarawak. ... Malaysia is a small and relatively open economy. ... United Malays National Organisation (UMNO) Youth Chief Hishammuddin Hussein brandishing the kris (dagger), an action seen by some as a defence of ketuanan Melayu. ... Pribumi is a term that refers to a population group in Indonesia that shares a similar socio/cultural heritage. ...

Notes and references

  1. ^ Means, Gordon P. (1991). Malaysian Politics: The Second Generation, pp. 8, 14, 15, 23–27, Oxford University Press. ISBN 0-19-588988-6.
  2. ^ "Snag in policy implementation", pp. 8–9. (Dec. 31, 2006). New Straits Times.
  3. ^ Long, Atan & Ali, S. Husin (ed., 1984). "Persekolahan untuk Perpaduan atau Perpecahan?", p. 281. Ethnicity, Class and Development Malaysia. Persatuan Sains Sosial Malaysia. No ISBN available.
  4. ^ Jayasankaran, S. (Dec. 25, 2006). Time to scrap equity requirements. The Business Times.
  5. ^ a b c Funston, John (2001). "Malaysia: Developmental State Challenged". In Government and Politics in Southeast Asia, p. 193. Singapore: Institute of Southeast Asian Studies. ISBN 1-84277-105-1.
  6. ^ Funston, John (2001). "Malaysia: Developmental State Challenged". In Government and Politics in Southeast Asia, p. 194.
  7. ^ Funston, John (2001). "Malaysia: Developmental State Challenged". In Government and Politics in Southeast Asia, p. 201.
  8. ^ Bose, Romen (Nov. 17, 2006). Racial tensions on rise in Malaysia. Al Jazeera.
  9. ^ Putra, Tunku Abdul Rahman (1986). Political Awakening, p. 98. Pelanduk Publications. ISBN 967-978-136-4.
  10. ^ Goh, Melissa (Nov. 21, 2006). Educationists in Malaysia concerned that NEP may cause race polarisation. Malaysia Today.
  11. ^ Burton, John (Nov. 22, 2006). Ethnic policy blunts Malaysia. Malaysia Today.
  12. ^ a b Ahmad, Abdul Razak & Chow, Kum Hor (Oct. 22, 2006). "The nation's economic pie in perspective", pp. 20–21. New Sunday Times.
  13. ^ Beh, Lih Yi (Nov. 1, 2006). Bumi equity hit NEP target 10 years ago. Malaysiakini.
  14. ^ Hong, Carolyn (Nov. 15, 2006). Stop debate on race and religion: Umno Youth. Straits Times.

Other references

  • Bennet, Abang (Oct. 30, 2005). " UMNO: A threat to national prosperity". Malaysia Today.
  • Goh, Cheng Teik (1994). Malaysia: Beyond Communal Politics. Pelanduk Publications. ISBN 967-978-475-4.
  • Musa, M. Bakri (1999). The Malay Dilemma Revisited. Merantau Publishers. ISBN 1-58348-367-5.
  • Ye, Lin-Sheng (2003). The Chinese Dilemma. East West Publishing. ISBN 0-9751646-1-9.

External links

  Results from FactBites:
New Economic Policy - Wikipedia, the free encyclopedia (858 words)
The New Economic Policy (NEP; in Russian Новая экономическая политика - Novaya Ekonomicheskaiya Politika or НЭП) was officially decided in the course of the 10th Congress of the Russian Communist Party.
It replaced the policy of "War Communism," mainly because War Communism was failing, and decreased all sectors of the economy to below the pre-WWI output.
The NEP was generally believed to be intended as an interim measure, and proved highly unpopular with the strong Marxists in the Bolshevik party because of its compromise with some capitalistic elements.
Malaysian New Economic Policy - Wikipedia, the free encyclopedia (2624 words)
Malaysian New Economic Policy (NEP or DEB for Dasar Ekonomi Baru in Malay) was an ambitious, though controversial, socio-economic restructuring affirmative action program launched by the Malaysian government in 1971 under then Prime Minister Tun Abdul Razak.
Although the policy ended in 1990, Malaysians often refer to it in the present tense, as much of the tangible economic benefits it offers the Bumiputra have never been completely ended.
The abstract policies and goals of the NEP were implemented by the Second, Third, Fourth and Fifth Malaysia Plans.
  More results at FactBites »



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