Changing Roles of Economic Technocrats in the "Small Country" Malaysia

Author Name TORII Takashi  (Faculty Fellow, RIETI / Associate Professor, School of Commerce, Meiji University)
Creation Date/NO. April 2006 06-J-031
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The changing roles borne by the economic technocrats of Malaysia from independence to the present day can be broadly divided into six periods based on the characteristics of the development policies of each administration (of the five administrations, only the administration of Mahathir Mohamad is divided into two periods). The most conspicuous changes may be said to have occurred during (1) period 2 - implementation of the New Economic Policy (NEP) beginning from 1971; (2) period 3 - earlier Mahathir administration (1981-1990); and (3) period 4 - latter Mahathir administration (1991-2003).

During (1) the direct conduct of business by the government, beginning with the establishment of government enterprises, and the full-scale implementation of development projects were carried out as policies for achieving the two main goals of the NEP. These resulted in 1) a centralization of power in the Prime Minister's Department and 2) a great expansion in the roles of the technocrats.

During (2) with the worsening of government finances and the poor performance of state enterprises under the Mahathir administration, launched in 1981, a series of government downsizing programs were introduced, as typified by privatization policies, and the government gradually narrowed its realm of activities while still seeking selective functions.

When we review the changing roles of Malaysia's economic technocrats, we see that the technocrats did suffer a massive shift from an expansion of their power and range of authority accompanying the introduction of the NEP to downsizing under the Mahathir administration. Regardless, it can be said regarding the entire period since the introduction of the NEP that: (a) the raison d'être of the economic technocrats was the drafting of the required development projects and overall development plans to achieve the NEP, and (b) the economic technocrats served throughout as "contributors and implementers" of development policy because of the existence of the large-scale development policy of the NEP, and because of the powerful leadership of Prime Minister Mahathir since the 1980s.