Focusng on the Asian frontier under the theme 'Scaling the Efficiency Frontier - Institutions : Innovation : Inclusion', Tan Sri Dato' Seri Utama Nor Mohamed Yaakop expressed a strong point on the severe depleting status of economic resources. Malaysia cannot rely on its current resources forever. It (Malaysia) needs to adapt to changes necessary to survive the world economy
HRH then presented his idea of an ideal 'World View' to address the so called disparity. These views should be appreciated from the heart and not from the brain alone. The salient points of those views are:
Paradigm of Production: Production alone cannot be the measurement of growth. An anti-myopic view is required to ensure that what has been utilised for production is also preserved to ensure a long term sustainability of the growth itself. One must not explore the best way to exploit but should also explore replenishment of what is exploited.Paradigm of Maximisation: There has been too much focus on short term maximisation. Many corporates in the developed countries strive to ensure highest earnings possible with a view of a fat cheque as the remuneration to its executives. They buy back shares from the market and forces the earnings per share to shoot up. In the end, the Chief Executive Officers get paid handsome bonuses. A true business should reinvest the surplus to expand its investment horizon. In short, Optimisation is the key word, not Maximisation.Paradigm of Resources Ownership: Resources are often deemed to have been owned. We, humans, are mere stewards on this Earth. We do not own the resources. Our right to derive profits from the resources is temporary and we owe the duty to ensure resources sustainability for future generations.
Do not develop what comes naturally: Being rich is not necessarily being economically developed. We cannot be blinded by the fact that we are rich with natural resources. Korea for example was rich with tungsten. Had it relied on that fact alone and be content with its strong economy that was solely backed on such resource, it would have probably be under developed now. Instead, they took a turn. Tungsten was there, yes, but a new frontier was warranted. They needed to go beyond what they naturally had. The result is magnificent. Who would have thought (back then) that Korea can be one of the leaders in World technology?Do not develop by following comparative advantage: We must not capitalise on our strength alone. This will turn us blind to other opportunities that are not so apparent when compared to our identified strength. We must not think that we are good merely because we are good at it. We must decide to be good at it. For example, why is Swiss good at making chocolates when they had never produced cocoa agriculturally? The African nations thought that their strength is only producing cocoa agriculturally and they missed the opportunity to further develop other strength - which was obviously hijacked by the Swiss.Encourage Entrepreneurship: An economy should be deregulated to support entrepreneurs so that they (the entrepreneurs) can take a leap of faith to face risks of unlimited liabilities. Entrepreneurs deserve a second chance. A failed entrepreneur should not be deemed a loser. On the contrary, they should be further supported as they have developed themselves further by virtue of learning through failure. The USA's Chapter 11 of the Bankrupcy Law embraces this restructuring and forgiving attitude. Some welfare states in Europe also have conducive environment for entrepreneurs. You can gauge this by looking at their (e.g. Finland and Sweden) income per capita growth of 2.7% that is higher than 2% registered for the USA.
Inclusive Development: Empowerment and affirmative actions for disadvantage groups (e.g. ethnic groups, women, poor families, etc) is also crucial in ensuring a more dynamically inclusive development that is both equitable and sustainable - intertwining economic platform with social platform. A powerful ingredient to achieve this is to institutionalise innovation that is inclusive of the society as a whole.
"Natural resources do not equate to economy. We need to go beyond that and not rely solely on our strength that will blind us from opportunities. We must decide to be good at what we want and affirmative actions will help ensure a more inclusive, equitable and sustainable economy" - Dr. Ha-Joon Chang
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