Malaysian Development Plans and Policies- Malaysia Vision 2020

Malaysian Development Plans and Policies. Malaysia Vision 2020. Also, Why Vision 2020 Failed.

Malaysian Development Plans and Policies

Malaysia has become one of the most enriched and developing countries in Southeast Asia by introducing and implementing some mega plans driven by the government of Malaysia. The higher authority of the country has taken these plans and implemented them in different terms of the government. Malaysia is an economically enriched country located in Southeast Asia that consists of three federal territories and thirteen states. In addition, the South China Sea has separated this country into two regions as Peninsular Malaysia and Borneo’s East Malaysia.

Malaysia has the 35th largest economy globally and the third-largest economy in Southeast Asia after Indonesia and Thailand. Malaysia is going to acquire the eligibility of the developed county by 2020. The Federation of Malaya got independence on 31st August 1957, and Malaysia on 16 September 1963. After 60 years, Malaysia has become one of the most enriched countries in the world by executing many mega policies.

Since 1966, the government of Malaysia has taken 11 medium-term plans to develop the socio-economic conditions in Malaysia; for example, the First Malaysia Plan (1966 – 1970), Second Malaysia Plan (1971 – 1975), Third Malaysia Plan (1976 – 1980), Fourth Malaysia Plan (1981 – 1985), Fifth Malaysia Plan (1986 – 1990), Sixth Malaysia Plan (1990 – 1995), Seventh Malaysia Plan (1996 – 2000), Eight Malaysia Plan (2001 – 2005), Ninth Malaysia Plan (2006 – 2010), Tenth Malaysia Plan (2011 – 2015), Eleventh Malaysia Plan 2016 – 2020. The authority took the first Malaysian plan to exceed the challenges to achieve the country’s economic growth. The New Economic Policy was introduced based on the principle of the second Malaysian plan that was introduced in 1970.

New Economic Policy (NEP)

The late Tun Abdul Razak Hussein, the second prime minister in Malaysia, introduced the New Economic Policy in 1970 under the Principles of OPP1.  This policy has two objectives; for example, the eradication of poverty from Malaysia and the reduction of ethnic discrimination. This policy came out because of the racial riots incident of 1969. Based on the Malaysian social-economic conditions now, it is safe to say that the New Economic Policy had succeeded. After five decades, Malaysia stands in a perfect economic, competitive advantage in Asia compared to other countries. The two main objectives of NEP are eradicating poverty and reducing racial, economic differences in terms of income.

At the evaluation time, the government identified that they could not eradicate poverty fully. They also noticed that the income inequity was reduced, but they could not achieve the goal concerning Malay corporate ownership. Both Tunku and Mahathir had articulated concern that the Malays remained too much dependent on the Chinese economically. Hence, they accepted another policy in 1991 for a period of 10 years, succeeded by the National Vision Policy (NVP) in 2001. The authority adopted NEP for 20 years, from 1970 to 1990. However, they finally replaced it with another mega-development project named National Development Policy (NDP) in 1991.

National Development Policy (NDP)

The National Development Policy, also part of the VISION 2020, was another mega plan to achieve the eligibility of a developed country. The acronym of the national development policy is NDP, introduced under the Principles of OPP2 in 1990. According to Aziz (1996), the NDP was first proposed and introduced by Mahathir Mohamad, also Prime Minister of Malaysia. The prime minister of Malaysia instructed to implement this national development policy in 1990. The prime objective of the national development policy is to achieve economic growth in all sectors and also ensure the benefits will reach every sector of society.

Although the development plan in Malaysia started in 1950 with the publication of the Draft Development Plan of Malaya, the National Development Policy replaced the New Economic Policy (NEP) in 1990. Dr. Mahathir introduced the vision 2020 plan in 1990.

The Malaysian government had taken three-tiered planning covering long-term, mid-term, and short-term planning. The long, medium and short term planning horizons are as follow:

  • Long-Term Planning:
  • First Outline Perspective Plan (OPP1), 1971 – 1990
  • Second Outline Perspective Plan (OPP2), 1991 – 2000
  • Third Outline Perspective Plan (OPP3), 2001 -2010
  • Vision 2020, 1991 – 2020
  • Medium-Term Planning
  • Five-year development plans
  • Mid-term review of the five years plans
  • Short-Term Planning
  • Annual Budget
First Outline Perspective Plan (OPP1), 1971 – 1990

The New Economic Policy was introduced in 1970 under the Principles of OPP1, 1970-1990. According to the Speech of Dr. Mahathir (2008), the percentage of the nation’s poverty has declined from 52.4 percent in 1970 to 17.1 percent in 1990. In West Malaysia, also known as Peninsular Malaysia, the poverty had declined to 15 percent, while in east Malaysia declined to around 30 percent. However, the New Economic Policy had not been succeeded in eradicating poverty.

Second Outline Perspective Plan (OPP2), 1991 – 2000

New Development Policy (NDP) was introduced under the Second Outline Perspective Plan (OPP2) principle in 1991. It was one of the best policies to make Malaysia a fully developed country by the year 2020.

“In 1992, the Second Outline Perspective Plan (OPP2) was introduced, and it was formulated based on the New Development Policy (NDP)

This plan is covered the period from 1991 to 2000. It also includes the Sixth Malaysia Plan and the Seventh Malaysia Plan towards vision 2020. The Seventh Malaysia Plan has introduced the knowledge-based economy, which can accelerate economic growth and increase international competitiveness.


Malaysian Development Plans and Policies Since 1971 To 2020, A Case Study.

Figure 1 – Malaysia’s Policies and Development Plans

Third Outline Perspective Plan (OPP3), 2001 -2010

The Third Outline Perspective Plan (OPP3) was introduced in 2001 for cover from 2001 to 2015. It includes the three mid-term plans such as the Eighth Malaysia Plan (2001-2005), the Ninth Malaysia Plan (2006-2010) as well as the Tenth Malaysia Plan (2011-2015). The objective of the Third Outline Perspective Plan (OPP3) was to increase the usage of ICT in all sectors in society, developing the manufacturing sector and developing the services sector.

 Vision 2020, 1991 – 2020

The Vision 2020 was a mega policy for the Malaysian government to secure the eligibility of a developed country by 2020. The other mid-term and short-term plans were articulated based on achieving this vision of 2020. In addition, the annual budget had been proclaimed to ease the way of achieving vision 2020. The New Vision Policy (NVP) was launched in 2001 and under Malaysia Eighth Plan, while the Economic Transformation Program (ETP) was under Malaysia Tenth Plan in 2010. All of this planning is toward Vision 2020. The purpose of the National Vision Policy is to establish a progressive and prosperous Malaysia where everyone will live in harmony.

The objectives of the National Vision Policy (NVP) were to ensure sustainable and environmentally friendly development. Therefore, the policy focuses more on ensuring that the environment is clean, safe, and healthy for living. Abdullah bin Badawi, fifth Malaysia’s Prime Minister, presented five regional economic corridors to safeguard Malaysia’s vision 2020 goal. The following five economic corridors were significant to enrich Malaysian economic growth: Northern Corridor Economic Region (NCER), Sarawak Corridor of Renewable Energy (SCORE), Iskandar Malaysia, East Coast Economic Region (ECER); Sabah Development Corridor (SDC).

Medium-Term Planning

Medium-term planning, also known as the mid-term plan, was very effective in increasing economic growth in Malaysia. This plan duration was five-year, such as the Eleventh Malaysia Plan (11MP), 2016-2020. Mid-Term Reviews (MTR) of the five-year development plans are based on the framework set by the long-term plan OPP. The medium-term plan implements a five-year development plan targeted for economic growth and the public sector development program. The medium-term review (MTR) is executed in the middle time of the five-year plan. The government takes new initiatives and directives to accelerate the long-term policy with a medium-term plan. They decide whether the project will keep ongoing or need to change something in the plan based on the medium-term review (MTR).

Annual Budget

The annual Budget is also known as short-term planning prepared and declared by the Ministry of Finance in Malaysia. The policy of annual budget implementation is aligned with the long-term and medium-term plans. During the preparation of the annual budget, the authority focuses on all private sector organizations and stakeholders. The annual budget development allocation is based on the development programs and projects approved under the two-year rolling plan.

Malaysia Vision 2020: Why Vision 2020 failed to achieve its goals.
Malaysia Vision 2020

Vision 2020 or Wawasan 2020 was a mega policy of the Malaysian government. Malaysia’s fourth and seventh prime minister Mahathir Mohamad introduced Vision 2020 in 1991. The mega plan was intending to secure a developed country’s eligibility by 2020. He also said the prime goal of the Vision 2020 was to obtain a self-sufficient industrialized nation by the year 2020. Additionally, they wanted to achieve some others objectives by this plan, such as social well-being, economic prosperity, world-class education, technology-based society, political stability, and psychological balances.

Based on achieving the vision 2020, the government took some mid-term and short-term plans, such as the National Development Policy 1991-2000 with OPP2, National Vision Policy 2001-2010 with OPP3, and Economic Transformation Program (ETP) under Malaysia Tenth Plan in 2010. Even the annual budget was proclaimed to ease the way of achieving vision 2020. The authority set these plans to establish a progressive, prosperous, and developed Malaysia where everyone will live in harmony.

The Nine Challenges that Must Overcome to Achieve Vision 2020

Malaysia cannot be a prosperous and developed country until overcome these challenges entirely that experienced from the beginning of independence. Therefore, the authority published eight challenges that must need to chase to achieve Vision 2020.


The first challenge of Vision 2020 is to develop a united Malaysian nation with a spirit of mutual destiny. This will form a peaceful nation where everyone lives in harmony. The country will ensure loyalty, justice, equality, and fair partnership for all citizens called ‘Bangsa Malaysia.’


The second challenge is to create a secure, developed, and psychologically freed country. The people will live in a society with full confidence and faith in the nation. Society must be fully conscious about its opportunity and potentiality also respected by foreigners.


The third challenge of Vision 2020 is to practice liberal democracy inside the country. It can make Malaysia a model for other developing nations in Asia and all over the world. In short, it is all about nurturing and promoting a mature democratic society.


The fourth challenge is to establish an ethical and moral society. The citizen of the nation will live in a society with religious, cultural, and traditional values.


The fifth challenge is developing a liberal, tolerant, and knowledgeable society, in which all Malaysian can practice their culture, traditions, religion, belief, and creeds. All Malaysian people belong to one nation. It doesn’t matter what the religion is, its origin, and the language.


The sixth challenge is to establish an innovative and technology-based progressive society. The people of this society will be a client of technology and utilize them to well-being for society. However, they could not bring all rural people under the technology umbrella.


The seventh challenge is to create a caring and cooperative society in which people will not leave their families but maintain a strong, resilient family system.


The eighth challenge is to assure an economically self-righteous society. They wanted to ensure the fair distribution of wealth in society. They also wanted to establish a society without any discrimination, exploitation, and injustice.


The last and ninth challenge is to establish a prosperous and developed society. The economy of the nation will be strong, resilient, competitive, and dynamic.

Does Malaysia Achieve Vision 2020 Successfully or Not?

Based on the discussion, Malaysia did not achieve Vision 2020 completely. The main aim of Vision 2020 was to establish a self-sufficient industrialized country by 2020 and secure the eligibility of a developed country. Malaysia has not achieved the status of a developing country because the nation could not overcome all the nine challenges mentioned earlier.

Discussion and Opinion Why Vision 2020 has failed

Doubtfully, some reasons affected the failure of Vision 2020 directly and indirectly. Based on my research, I have discovered three important reasons that contribute to the failure of Vision 2020; for example, leadership, discrimination, and the economy.

  1. Leadership

Prime Minister Tun Dr. Mahathir Mohamad blamed that Malaysia could not achieve Vision 2020 due to the wrong leadership skills of the previous prime minister Abdullah Badawi and Najib Razak. Actually, the administrators in Malaysia could not understand the nine challenges properly.

  1. Discrimination

The challenges of Vision 2020 are fostering a liberal democratic society, moral and ethical society, progressive scientific society, discrimination, and exploitation-free society. A Malay-led government cannot establish a liberal democratic society, and discrimination still exists in several sectors in Malaysia, including University, job, business, and politics. Thus, discrimination obstacles to achieve Vision 2020.

  1. Economy

Finally, the ninth challenge was to create an economically righteous society. An economically righteous society takes care of the interests of all people, not only the rich but in Malaysia. But, rich people are getting wealthier daily through the domination business market while general people survive hand to mouth. The economy couldn’t ensure the fair share of the country’s wealth to everyone; therefore, Malaysia could not achieve Vision 2020.


Prime Minister Mahathir Mohamad introduced Vision 2020 in 1991 to establish a prosperous, developed, discrimination-free, technology-based, ethical, and liberal society. However, they have established enough technological, economic, and structural development in Malaysia. However, Malaysia could not achieve Vision 2020 completely.

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