Malaysia's new Economic Model: Is the Malaysian government serious about economic liberalisation?

This paper analyzes the effectiveness of Malaysia's New Economic Policy (NEP) at reducing inter- and intra-ethnic income disparity. Although the NEP was successful in increasing native Malays' economic participation, government intervention has been unsuccessful in addressing income disparity. Chinese and Indian communities within Malaysia are, on average, still better off despite the NEP. A new economic policy, the New Economic Model (NEM) was introduced in late 2010. Although this promised to be a policy that was blind to race and relied heavily on economic liberalization, pro-Malay nationalists pressured the government to weaken its robustness before publication. The author analyzes reforms necessary for the NEM to succeed.