Malaysia Relaxes Affirmative-Action Policies

[Coventina]

Source: Wall Street Journal

Malaysia's Prime Minister Najib Abdul Razak announced a significant relaxation of the racially divided country's long-standing affirmative action policies in a bid to lure foreign investors and accelerate the country's recovery from the global economic slump.

Mr. Najib Wednesday told reporters in Malaysia's administrative capital Putrajaya that foreigners investing in parts of the service sector would no longer be required to take ethnic-Malay partners, who currently must own 30% of any joint venture. The newly opened sectors include health, tourism, and business and technology services, but don't include areas in which there is heavy state-involvement or which are politically sensitive, such as air travel, utilities and retail, where companies such as France's Carrefour SA and Britain's Tesco PLC have pushed for more access.

The policy change indicates how one of the central tenets of Malaysia's race-based political system is coming under pressure as the country's economy struggles to cope with the global economic crisis and could flag further reforms to come, analysts said. Mr. Najib hinted that further measures may be announced next week, including changes in the country's finance sector.

Singapore-based HSBC economist Robert Prior-Wandesforde predicts Malaysia's economy – the third most open in Asia – will contract 3.5% this year, leaving the country's leaders scrambling for ways to give the country a short-term boost and prepare the ground for a sustained recovery when the global economic climate improves.



Read more: http://online.wsj.com/article/SB124040220273943253.html?mod=googlenews_wsj

[burning rain]

1. "Race-based"....

hmmm, they don't want to say anything about religion?