KUALA LUMPUR, March 31 — Malaysia can emerge stronger in the post-pandemic future by accelerating strategies to address the three D’s of supply side reforms known as accelerating digitalisation, rethinking downstreaming, and reducing distortion.
In its Economic and Monetary Review 2020 report, Bank Negara Malaysia (BNM) said the 3D’s of supply side reforms will enable Malaysia to emerge stronger in the post-pandemic future, with the right investment strategy and the right activities.
“Accelerating digitalisation is an essential policy thrust amid the rapid technological changes today and in the coming years.
“These include sectoral initiatives focused on embracing digitalisation within the consumer-related, agricultural, mobility and healthcare industries,” it said.
BNM said rethinking downstream is also vital, particularly for Malaysia’s palm oil industry, as a higher value add through enhancing product complexity provides new growth opportunities.
“Adopting higher value down streaming would accelerate the manufacturing of products with higher product complexity further up the palm oil value chain,” it said.
Finally, the central bank said reducing distortion in providing investment incentives by tailoring these incentives to activities under the National Investment Aspirations (NIAs) will result in better allocative efficiencies by attracting quality investments.
“A forward-looking pivot toward investment-led growth requires a bold strategy in attracting quality investments centred around innovation and the creation of highly complex products,” it said.
BNM said in the post-pandemic future, these 3D’s of reforms can propel Malaysia to attain greater policy adaptability and flexibility to accommodate the rapid shifts in trends.
“This, in turn, will provide businesses with an environment that is conducive for dynamism and creativity to capture new growth opportunities.
“Strong execution and follow-through are key to ensure Malaysia achieves the desired goals from these strategies,” it added.