Malaysia’s 14th General Election (GE14) resulted in a watershed change of the Malaysian Federal Government, unseating the Barisan Nasional political coalition that has been in power in one form or another since 1957. With the theme of “Rebuilding the Nation, Fulfilling Dreams,” the new Pakatan Harapan-led Federal Government has moved quickly.
Sunday, 10 June 2018 marked one month since Tun Dr Mahathir Mohamad was sworn in as Prime Minister. The following are key policies and changes announced to-date:
Possible upcoming reforms:
Based on the Pakatan Harapan Manifesto for GE14, further reforms are expected in “new Malaysia”. These include:
Malaysia will seek to reduce heavy reliance on infrastructure investments from any particular country, and diversify its source of foreign direct investments including by strengthening existing trade relations with countries such as Japan, Korea, the countries of the European Union and the United States.
Chinese investments are expected to remain significant. The Prime Minister has stated the review of PRC-funded projects will not harm China-Malaysia relations. The new government will support the Belt and Road initiative and welcomed PRC investment into Malaysia. Strong Chinese investments continue such as the soon-to-be-launched WeChat Pay, an e-wallet service by Tencent Holdings Ltd, into Malaysia.
Monopolies will be broken up. New spaces will be created and fostered for entrepreneurs with new ideas, business models and practices to flourish.
A clean slate will allow the introduction of innovative housing schemes to help first-time home buyers’ purchase their homes.
With the potential restructuring of big-ticket infrastructure projects such as the HSR and ECRL, there may be an uptick in investments in more localised intra-city public transport projects, such as light rail, buses and cycle-lanes. Grab is already a Malaysian-born regional ride-hailing giant, and that business model may see further growth in the country.
With the lifting of monopolies, previously closed opportunities will become available to a wider pool of pharmaceutical businesses. Budget allocations for healthcare may see an increase.
Whilst short term market and currency volatility are expected in the near term, the long term prospects for the nation’s economy are viewed in a generally optimistic light. Further significant reforms are expected to be announced in the following weeks and months.
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