Economic development and progress of the Ummah is inter-related in that both are closely linked and are influenced by the same factors. In economic development, focus is given to aspects related to muamalat, national resources utilisation planning, spending priorities based upon agreed criteria, government policies relevant to these aspects, and the continued efforts to ensure that civilised society enjoys a level of lifestyle which guarantees their dignity.
Although it is said that economic development is a lifeline for the progress of civilisation and the Ummah, it does not imply complete obsession with achieving economic might, a belief embraced under the capitalism ideology. Yet at the same time, it is difficult to imagine a country developing without adequate resources or with limited trade networks and weak economic potential.
The 9th Malaysian Plan (RMK-9) is a five-year plan which encompasses the period between 2006 until 2010. It contains a diverse range of programmes and projects aimed to expedite the nation’s development holistically towards Vision 2020. RMK-9 is based upon five core thrusts of the National Mission, which is a government framework for the 15-year development phase from 2006 until 2020.
The National Mission focuses upon efforts to attain Vision 2020 - to turn Malaysia into a developed nation. The main objective for the 2007 Budget is to ensure that the National Mission is translated into programmes and projects which can be implemented quickly and effectively.
The National Mission was outlined based upon five core thrusts, as follows:-
First: To move the Malaysian economy up the value chain;
Second: To raise the capacity for knowledge and innovation, and nurture ‘First Class Mentality’.
Third: To manage the issue of continued socio-economic inequality, in a constructive and productive manner.
Fourth: To improve the standard and sustainability of quality of life; and
Fifth: To strengthen institutional and implementation capacity.
Climbing up the economic ladder is the first core thrust of the National Mission. By increasing competitiveness, productivity and innovation, the country is seen to be able to increase the production value for all economic activities - from agriculture to manufacturing. Through the application of knowledge and technology, the country can also pioneer new sources of growth in new economic sectors such as information technology and biotechnology. Malaysia will be able to attract even more investors by making good use of all resources available in the country.
As a step to ensure continued economic growth and more efficient, robust and competitive investment scene, the government has announced ten new measures to invigorate and establish the nation’s capital market. To further strengthen these measures and guarantee solid economic foundations in the medium and long terms, the Government has once more taken initiatives immediately to draft strategic pro-growth policies and measures under the New Strategic Package.
The New Strategic Package focuses on four main strategies and contains 90 measures aimed towards generating economic activities through the amalgamation of domestic resources while reducing dependence upon external sectors. The strategies are as follows:-
Strategy I:
To encourage Public Investment
Strategy II:
To strengthen the Nation’s Competitiveness
Strategy III:
To develop New Growth Areas
Strategy IV:
To increase the Effectiveness of the Delivery System
In addition, under RMK-9, the Government also plans to develop five economic territories to ensure more balanced growth distribution and national harmony between the different states and regions. The approaches taken for the development of each territory will also differ depending upon each region’s edge and potential.
Thus far, the Iskandar Development Region (IDR) has already been implemented and followed by the Northern Corridor Economic Region (NCER), which was launched by Prime Minister, Datuk Seri Abdullah Ahmad Badawi recently.
If the objective of the IDR is to create a metropolitan city like Shenzen in China, and to complement Singapore, then the NCER is aimed towards the reduction in the income gap and equal distribution of wealth. IDR, which involves only one state, is located in a new development area where brand new facilities will be put into place, requiring investments of billions of Ringgit particularly from foreign investors.
The NCER involves four states, 21 districts and roughly 4.6 million residents directly or indirectly. It does not entail installation of new infrastructures because the existing facilities - with a number of upgrades in line with future requirements - will be utilised.
Through its socio-economic framework of action, development plans for NCER will also not affect whatever existing contents available in the region. The NCER initiative is meant to strengthen existing sectors, such as agriculture, in the region. Upgrades will be implemented so that farmers who are currently below the poverty level will be able to generate higher incomes in the future.
In addition, among explicit efforts to develop the nation’s economy comprehensively, from the viewpoint of Islam Hadhari, is the allocated efforts aimed to encourage Islamic Finance. Malaysia has succeeded in achieving rapid growth in Islamic Finance services, particularly through increased investment volume, service efficiency, product diversity, establishment of infrastructure, and increase in the number of Islamic Finance institutions. Malaysia is also among the first nations in which supranational institutions have issued Islamic bonds in the Malaysian Ringgit currency. These institutions are the International Finance Corporation with the issuance of 500 million ringgit, and the World Bank, with 2 billion ringgit.
Today, Malaysia is the largest issuer of Islamic bonds in the global capital market, with a total of 30 billion US dollars; commanding more than 70 percent of global issues, which amounts to 41 billion US dollar.
As one of the founding members of the Organisation of the Islamic Conference (OIC), Malaysia continues with efforts to strengthen the unity of the Ummah in aspects of quality, religion, economy, defence, education and many others. In line with this, during the 10th OIC Conference which took place from the 16th until the 18th of October 2003, the country approved the Putrajaya Declaration along with guidelines towards realising its objectives, including efforts to increase cooperation in areas of development, science and technology, information technology as well as trade and economy among OIC member countries.
In the area of economy, Malaysia has proposed a programme to increase the potential of OIC member countries, especially the less developed ones, so that economic development efforts aimed to eradicate poverty can be implemented more effectively. This is the effort spearheaded by Malaysia to contribute towards the economic development of these countries.
It is hoped that this initiative will be implemented by other less fortunate OIC member countries and that the success of this programme will directly contribute towards the alleviation of economic disparity and provide an approach which can lead to unity of the Ummah. In addition, Malaysia also held a conference of eminent figures from the 27th until the 29th of January 2005, known as the ‘Commission of Eminent Persons’ whose objective is to prepare an action plan to enable the Ummah to face challenges of the 21st century.
In order to coordinate and escalate efforts to unify opinions and achieve concrete decisions for all cooperative efforts amongst its members - be it in politics, economy, culture, social, spiritual, and science - the OIC Summit and ministerial level meetings have also established several committees, including the Al-Quds Committee; the Standing Committee on Information and Cultural Affairs (COMIAC); the Standing Committee on Economic and Commercial Cooperation of the OIC (COMCEC); the Standing Committee on Scientific and Technological Cooperation (COMSTECH) and the Islamic Commission for Economic, Cultural and Social Affairs.
To achieve of OIC objectives, supporting agencies and institutions have also been created and mobilised covering various areas including culture, science, economy, law, finance, sports, technology, media, vocational, social and humanities.
As a role model for an Islamic nation in the eyes of the world, Malaysia is also deemed to have the potential to lead the global halal industry. In order to further advance the halal industry, the Halal Industry Development Corporation will be established under the Prime Minister’s Department, with a launching grant of 25 million ringgit. This Corporation will coordinate and ensure that all efforts towards developing the halal industry are implemented in a unified and comprehensive manner.
The Corporation will coordinate efforts to update halal standards, develop the local halal industry, promote Malaysian halal products and services to the world, and support the investment in Malaysia’s halal sector. The Malaysian International Halal Showcase (MIHAS) which was spearheaded by Yayasan Dakwah Islamiah Malaysia (YADIM) and Malaysia External Trade Development Corporation (MATRADE), as well as the World Halal Forum 2006 which received overwhelming response, will continue to be annual events.
In addition, Malaysia has also allocated 50 million ringgit to prepare Halal Parks in Pasir Mas, Kelantan; Gambang, Pahang; Chendering, Terengganu and Padang Besar, Perlis. The SME Bank has allocated 20 million ringgit in loans for entrepreneurs developing halal products. Malaysia’s efforts in encouraging the halal industry will not only attract the attention of Islamic countries, but also other countries worldwide because the key criteria of the halal industry is the utmost priority towards purity and cleanliness, which in fact is in line with the needs and demands of the global community, altogether increasing the nation’s economy at a global level and turning Malaysia into a leader and role model for other Muslim nations.
Prime Minister, Datuk Seri Abdullah Ahmad Badawi, also sees a bountiful market especially for halal products and services in terms of investment and trade, and Muslim nations are urged to take action to acquire them. Based on simple calculations, taking into consideration the per capita expenditure on food among Muslims in the world, it is estimated that the halal food market is worth at least US$580 billion a year. This amount does not include logistics or non-food related aspects, which, if added to the amount, will result in a much larger estimate – roughly US$2 trillion.
In support of Government measures, YADIM, which also sees big potential in the halal consumer products and services market, has initiated an effort to create a halal market platform through MIHAS - the largest halal showcase in the world. Starting from 2004, MIHAS is organised each year to gather and create business opportunities among Muslim countries in particular and the world in general, to source supply and acquire world-class halal products. MIHAS is regarded as the prime gateway for international halal products, creating strategic connections and breaking into the global Islamic market.
The participation of foreign countries is encouraging with increases every year. Most recently, MIHAS 2007 succeeded to attract participants from 26 different countries including Iran, Indonesia, South Africa, China, Australia, India, Bangladesh, Turkey, United States, United Kingdom, Saudi Arabia, Kuwait, Brunei, Morocco, Sudan, Singapore, Bosnia & Herzegovina, the UAE, Croatia, Kazakhstan, Canada and Argentina.
Continuing with its pioneer efforts and subsequent establishment as a key player in the halal market, YADIM has also introduced products and services using the trademark ‘Sure Halal’, in addition to efforts to widen its investment activities with the opening of the ‘Sure Halal Shop’ in Sungai Petani, Kedah. It also plans to create an Investment Unit charged with supervising, monitoring and undertaking studies aimed towards strengthening investment activities, including real estate with the purchase of six suite units valued at RM6 million to be turned into a hotel in George Town, Penang, whereby the hotel will apply an Islamic Hotel concept, where all management and food preparation concept will be offered to guests.
Data provided by Loco Monitor, an entity which solicits foreign investment all over the world, places UAE as the country most involved in foreign investment among OIC member countries (with a total of 175 projects between 2002 and 2007), while Malaysia comes in second (with 33 projects). This finding proves that the country does not merely pay lip service to dreams of bolstering trade among Muslim countries; it is serious in implementing this plan.
There still exist much room to ensure that the strengthening of intra-Muslim nation economy will be successfully achieved. The fact is, our country has expertise in various areas – what’s missing is the effort to channel this expertise to the right place and the right region. |
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