Malaysia

The main objectives of the study are to: a) assess options and formulate a strategy for power trade among the Greater Mekong countries, paying special attention to the... Show More + barriers to trade and the policy, institutional and commercial framework required to develop and operate efficiently a regional power network; and b) establish the rationale and options for donors' support to power trading and transmission network investment needs within the region. Although power trade among the Greater Mekong Sub-region (GMS) countries is beginning to grow, there are important barriers that could prevent its development: 1) policy barriers, 2) technical barriers, 3) institutional barriers, and 4) commercial and financial barriers. The strategy proposed in the study addresses the following overarching issues: 1) Regional electricity trade should be second to national and local needs. 2) Conditions must be established for a public-private partnership to develop power trade in the region. 3) Conflicts must be resolved between short- and long-term objectives, between national and regional views, and eventually, between specific projects. 4) There must be a common path of fundamental economic practices to allow open access to transmission. 5) Financial and technical assistance must be secured. 6) There must be a regional agreement on policy issues and an institutional framework to address market uncertainties and potential conflicts, and to promote regional trade. Show Less -

The objectives of the report are: (a) to identify the scale of urban pollution in Malaysia as it affects the quality of air and water and the accumulation of toxic... Show More + waste; (b) to identify the major sources of pollution in industry, transport and in the form of municipal waste and sewerage; (c) to suggest cost-effective strategies for pollution abatement; and (d) to evaluate new policy initiatives for strengthening state and local governments, privatization and institutional reform to improve pollution control and delivery of urban municipal services. The basic message of the report is positive and action-oriented. Developed country experience shows that most forms of industrial/urban environmental degradation can be reversed even after long period of neglect, but at increasing cost. The approach taken in this report thus is to: (a) identify and tackle those problems whose postponement would result in high costs later; and (b) suggest low cost control measures relative to their benefits (in terms of avoided health costs and productivity loss). Show Less -

The focus in Malaysia's new development policy has shifted from poverty alleviation and ethnic equality to productivity growth and promotion of a strong private sector... Show More + so that the country can remain internationally competitive. To stimulate long-term productivity growth and achieve the objective of a strong private sector, important adjustments are needed in the government's fiscal policy. The four elements of such a strategy are: (i) maintaining macroeconomic stability by avoiding large deficits; (ii) increasing public investments that complement those of the private sector and reducing investments that compete with those of the private sector; (iii) defining the government's role as a regulator and monitor of standards in the delivery of social services rather than simply the direct provider of services; and (iv) refining the tax policy to meet expenditure needs without distorting incentives to work and invest. This report reviews the principal components of Malaysia's public expenditure and tax policies and recommends measures that strengthen the four above mentioned elements. Show Less -

Late in 1985 the Government of Malaysia began implementing a Special Low Cost Housing Program (SLCHP). This report reviews that program. It is a study of the incentives... Show More + and disincentives that various forms of government intervention create in a major sector and how efficiency and equity are affected as a result. The study finds that it is clear that the market, as influenced by the existing policies and programs, is not yielding enough low-cost units to satisfy the potential demand. Subsidies are deep, but inefficent, because they are offset by high regulatory costs. A major conclusion is that holding location and design constant, private developers build better and more marketable low-cost units than public developers. However, in the absence of subsidies, even the most efficient builders cannot deliver affordable houses in the current regulatory environment. On the other hand, were regulatory provisions modified, it would be possible to increase affordability substantially while at the same time reducing the reliance on housing subsidies. Show Less -

This report turns attention to the issues associated with the allocation of resources and the transformation of accumulated financial capital into an efficient and dynamic... Show More + resource base. The report analyzes investment, financial intermediation, and wage setting processes which all involve risk setting at the firm and sectoral levels. Also addressed are the macroeconomic responses to external shocks. An update of macroeconomic performance and medium term prospects is provided in Volume I of the report. The analysis first retraces developments in the Fourth Malaysia Plan (1981-85) as this heralded the start of the industrial growth strategy, and then identifies several significant structural weaknesses, which were brought into full view during the recession of 1985-86. Next, the prospects for medium term growth are discussed, both from supply and demand perspectives. The last chapter contains a set of integrated policy recommendations to sustain growth. Volume II of the report contains chapters on public enterprises, public finance and employment. These chapters contain more detailed analysis on which the policy recommendations and medium term scenario in Volume I are based. Show Less -

This report turns attention to the issues associated with the allocation of resources and the transformation of accumulated financial capital into an efficient and dynamic... Show More + resource base. The report analyzes investment, financial intermediation, and wage setting processes which all involve risk setting at the firm and sectoral levels. Also addressed are the macroeconomic responses to external shocks. An update of macroeconomic performance and medium term prospects is provided in Volume I of the report. The analysis first retraces developments in the Fourth Malaysia Plan (1981-85) as this heralded the start of the industrial growth strategy, and then identifies several significant structural weaknesses, which were brought into full view during the recession of 1985-86. Next, the prospects for medium term growth are discussed, both from supply and demand perspectives. The last chapter contains a set of integrated policy recommendations to sustain growth. Volume II of the report contains chapters on public enterprises, public finance and employment. These chapters contain more detailed analysis on which the policy recommendations and medium term scenario in Volume I are based. Show Less -

Given the Government's intention to trim public investment and improve efficiency in the energy sector, this review evaluates the efficiency of resource allocation and... Show More + resource utilization in the power sector, the largest subsector of energy. In the area of resource allocation, the power sector is facing two major issues including (a) the extent to which future power generation should be based on Malaysia's abundant gas resources; and (b) the timing for initiation of the large Bakun hydroelectric project in Sarawak. In order to properly assess these complex and interrelated issues the review examines the generation expansion programs of the three utilities: the National Electricity Board (NEB), the Sarawak Electricity Supply Corporation (SESCO) and the Sabah Electricity Board (SEB). The report analyzes their least-cost investment programs within a consolidated framework. Within this framework, the issues of gas use and the Bakun project are investigated in detail. In the area of resource utilization, the review examines the financial and pricing practices of the power sector and identifies potential opportunities to reduce the operating cost. Show Less -

Prior to the eighties, the agriculture sector saw greater diversification and increases in output. This occurred due to initiatives by the private and public sectors... Show More + which resulted in the rapid spread of oil palm and cocoa, the doubling of rice production and a 60 percent expansion in fish output. An economic mission of July 1985, analyzed the current agricultural outlook in terms of sectoral trends and issues for major crops and drew attention to the need for diversification. This report sets out the findings of the mission. It begins with an overview of the current status of Malaysian agriculture and the major issues. Government policies and programs designed to deal with these issues are briefly reviewed. The report then presents a summary of the prospects for diversification with respect to the identified issues. The implications for public policy and expenditure are then considered together with the implications for the Bank's lending program. The report concludes by outlining a strategy for Bank operational assistance to the sector. Show Less -

The report examines Malaysia's prospects for developing export-oriented manufacturing industries on the economic base provided by it's primary sectors while persevering... Show More + with the adjustment program begun in 1983. Malaysia has an efficient tree crop sector and substantial petroleum resources, but oil production is approaching its peak, rubber output is on a declining trend and earnings from palm oil and cocoa will take time to recover from the price slump that has afflicted commodity markets. The cut in energy and raw material prices in 1985-86 has also eroded government revenues and the economy's potential for saving. Achieving balance-of-payments equilibrium and containing the increase in external debt make a further spell of fiscal austerity unavoidable. The report emphasizes the importance of broadening the industrial base and promoting manufactured exports through major institutional changes and a reform of incentives as a way of regaining growth momentum. Show Less -

This report is based on an earlier recommendation for Malaysia's national agricultural policy to remove specific biases against the agricultural sectors so that its... Show More + terms of trade vis-a-vis the rest of the economy could improve sufficiently to make agriculture a more attractive source of income. The focus of this report is on pricing interventions in agricultural markets, i.e. the numerous mechanisms whereby returns to agricultural activity are affected through changes in the prices of outputs, intermediate inputs or factors of production. Rural development programs depend crucially on the price environment in which farmers operate. In the absence of proper incentives for production, the provision of infrastructure and/or research and extension will have little effect. Conversely, a sectoral approach to agriculture policy requires a comprehensive assessment of the feasible role for prices, taxes, and subsidies in the sector. Appropriate price incentives by themselves may be inadequate for overcoming the major land, labor, technical, and institutional constraints that currently restrict agricultural growth in Malaysia. Show Less -