Guan Eng: Give state power to spur economic growth

The federal government should be pro-active in liberalising trade rules and decentralising its overwhelming powers to stimulate the country's growth, said Penang Chief Minister Lim Guan Eng.

Liberalisation and decentralisation policies were the keys to unlock and arrest the country's stagnant growth over the years, which saw Malaysia falling far behind countries it once was ahead of such as South Korea, Taiwan and Singapore, he told reporters in George Town today.

"The federal government should relax the trade regulations, probably by ridding of preferential and protectionist economic schemes.

"Federal powers should be decentralised and delegated to state and local authorities to make independent and fa st-track decisions to stimulate socio-economic growth.

"This would arrest the current decline and stimulate growth," said Lim, who also handles industrial development, international trade, and land affairs and development portfolios.

The chief minister had earlier officiated at the opening of the Indonesia-Malaysia Thailand Growth Triangle (IMT-GT) Joint Business Council (JBC) 26th executive meeting in a George Town hotel.

Lim said liberalisation at all levels would boost the potential of Penang, and Malaysia in general, to become the centre of the IMT-GT growth.

A potential triangle

"For instance, we should liberalise the banking, financial, infrastructure and communication industries to promote Penang as a regional hub for IMT-GT," he said.

He also pointed to the vast potential of the triangle which w as blessed with large fields of soil land, abundance of cheap labour, rich natural resources and a sizeable 70-million population of internal market.

Lim wants the IMT-GT players not only to be pro-growth and pro-jobs, but also be pro-poor, to enable benefits of regional growth to reach the low ranks of society.

"The regional wealth and prosperity should be shared by all to develop a healthy socio-economic growth and human development.

"Without this, we cannot go far," he cautioned, addin g that the regional economic stakeholders and major players should adopt a 'give and take' approach to achieve this.

InvestPenang executive chairperson Lee Kah Choon echoed Lim's sentiments, stressing that countries such as China, India and Indonesia were now enjoying double-digit growth due to their respective governments' liberalisation and decentralisation policies.

"It's a global phenomena that countries with liberal policies enjoy double digit growth," he told Malaysiakini at the JBC meeting.

While Korea, Taiwan and others had liberated their trade and political policies to move ahead and achieve developed status, he noted that Malaysia went in the opposite direction over the years resulting in the country lagging far behind.

Mobilise resources

"There should be more autonomy for state and local authorities to make independent decisions according to local needs.

"These would reduce red tape and unnecessary intervention," he said, citing federalisation of issuance of licences and mapping out routes for public transport systems as a bad example that hampers industrial growth.

"For instance, the federal government should relax the rules controlling expansion of foreign banks in the country.

"This would boost investments, trigger growth and create more jobs," said Lee.

IMT-GT is part of Asean integration and liberalisation effort to promote cross border business, investments, education, tourism and cultural ties in an area encompassing the northern, eastern and central region of Peninsular Malaysia (eight states), southern region of Thailand (14 provinces) and Sumatra island in Indonesia (10 provinces).

Establised in 1993, IMT-GT main area of cooperation is in trade and investment, human resource development, infrastructure and transportation, agriculture, agro-based industry and environment, tourism, and halal products and services.

Current IMT-GT intra-trade is US$3.8 billion with agriculture products, spare parts, and service industries, mainly healthcare, being main contributors.

In his keynote address earlier, Lim called on all IMT-GT member-states to pool, consolidate and mobilise their resources, and work collectively to stimulate growth.

"Despite our differences in many areas, we shall not compete, but rather complement each other to produce results for mutual benefits and interests," he said.