Change policies to raise productivity, please

Minister of International Trade and Industry Mustapha Mohamed launched the Productivity Report 2015/16 on June 16, and rightly stressed that “the enhancement of productivity is crucial for Malaysia to remain competitive in the area of trade, as well as to attract investments”.

However, productivity grew by only 3.3 percent last year to RM75,538, compared with the 11th Malaysia Plan Target of 3.7 percent per annum. This year productivity is estimated to grow at an even slower pace of between 2.5 – 3.5 percent. But we hope we do better than last year, although this seems unlikely. These are indeed serious shortfalls in our National Productivity. We can ill-afford low and declining productivity in our struggle to achieve our 2020 goals to become a developed nation and to achieve sustainable development beyond 2020.

The minister has, however, also courageously stated that, there must be a “transformation of individual skills, attitudes and efforts – to allow innovation to drive improvements”, and of course productivity. These are all worthy national aspirations. But frankly, we will continue to register relatively low productivity, unless and until, we change our policies.

What policy changes do we desperately need to change, or what policy constraints must we remove, to raise productivity?

The following policy constraints to progress have to be reviewed and changed or even removed, if Malaysia’s productivity is to be improved?

1. Firstly we must admit that the minister, however, able he is, cannot do it all by himself, to improve national productivity.

It has to be a holistic national effort that has to be strongly led and driven by Prime Minister Najib Razak himself, through the National Productivity Council. New policies have to be adopted and strictly followed, by the whole Cabinet and all menteris besar and chief ministers.

2. Our national competitive policies and practices have to be structurally transformed, to actively promote high productivity at all levels of our society. We cannot even hope, as Mustapa genuinely does, to expect that the “spirit of productivity will continue to live and breathe among Malaysians” – among the youth, the universities, businesses and the Government sectors – if we continue with our protective and preferential policies and practices.

It will indeed, be an unrealistic contradiction of terms, to aim for higher productivity, in a poor competitive environment. We can no longer just tinker with our national production machine, it needs a full overhaul.

3. Thus, we have to take more drastic measures to enhance our low education standards or continue to lose out, as evidenced by our tragic and wasteful brain drain. More higher quality graduates at all levels will certainly raise productivity, we cannot afford to lose them.3. Educational quality and standards in our country are sadly, comparatively low by international bench marking. The command of English as an international language has been steadily declining. Hence, our former “comparative advantage” in international trade and investment and communication has also been fading away.

4. Race and religious perversions and distortions continue to be unnecessarily emphasised in our politics, policies and practices, both in Government and the private sector.

So where is the hope for promoting a “spirit of productivity”? We seem to be too often excessively preoccupied in negative, non-productive racial and religious pursuits that will in fact undermine competition and productivity and the national will to progress.

The proposed chopping of hands and legs is not only frightening, it will also not help increase productivity.

5. How can we promote productivity amidst polarisation?

The are now growing negative attitudes, based largely on the painful question – why bother about productivity when our future appears so uncertain? We rarely now proudly proclaim – “Malaysia Boleh”. Today there is more cynicism over this slogan. Many able Malaysians are losing hope, as extremists appear to be tolerated and even encouraged.
6. Corruption and fiscal inefficiencies are increasing in Government and in the private sector as well. These negative trends cannot raise but will instead erode productivity and competitiveness.

Worse still we continue to speak about these weaknesses, but don’t really do much about improving the productivity, innovation and competition, except in more form than substance.

There is too much rhetoric, but much less positive results to show in the form of less corruption and more productivity. Hence, Mustapha may be a voice in the wilderness, with too many wild camels running away with the tents of productivity.
Again, the recent by-elections show clearly that money politics and state capture are thriving and at the same time countering productivity and efficiency at the expense of more national progress.

All Malaysians will welcome the clarion call of the able and well meaning Mustapha to raise productivity, for national progress.

But there are rising doubts, as to whether we can actually raise national productivity, given the six policy constraints mentioned above.

Indeed, we have to urgently address and change these and other policy constraints, if we are to increase our national productivity, to achieve the aims of Vision 2020 and to attain our United Nations Sustainable Development Goals.

For this, we need to pontificate less and pursue policy changes with even more courage and speed, or let our productivity and progress, lose out and decline. We have to reject the notion that Malaysians tend to “sleep on the job” as this is bad for productivity and the perception of investors.

I would strongly propose that not only the upcoming Productivity Blue Print, but also Budget 2017, come out with new policies to counter the constraints to productivity, to promote productivity to achieve greater national progress and welfare for our people.

With more support for the views of our minister, then hopefully we shall overcome our policy constraints and succeed in increasing productivity, to become a more progressive nation in the future.

Article published in Free Malaysia Today, Malaysiakini, The Star, and The Sun Daily.

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