Malaysian Prime Minister Najib Razak on Saturday announced cash aid and a raft of measures to bolster the economic status of ethnic Malay majority, deepening a decades-old controversial affirmative action program.
Some opposition politicians call it a ploy by Najib to cement his leadership ahead of next month's elections in his United Malays National Organization, the linchpin of the ruling coalition. Najib has come under pressure after a poor showing in May general elections, where his ruling coalition won the polls but lost the popular vote.
Najib said the measures were necessary to close the wealth gap between Malays and minority Chinese and Indians. This includes 1 billion ringgit ($304 million) in two funds for Malay businesses, granting them more government contracts, skill training schemes for youths and allocating more houses for Malays in state projects in urban areas, he said.
“Do not misunderstand the Malay economic empowerment. This initiative is not at the expense of or taking away the rights of any other people... there is no prejudice against other races,” he said.
Malaysia's preferential treatment started in 1971 to lift Malays, who account for 60 percent of Malaysia's 29 million people, from poverty after race riots. The policies are credited with enlarging the Malay middle class and putting 23 percent of corporate wealth in Malay hands, but the opposition says the system has been abused to enrich the well-connected elite and distort the economy.
The system has also fueled a brain drain, as many Chinese migrated to Singapore and other countries due to higher wages, unhappiness over poor governance and lack of meritocracy. A 2011 World Bank report said Malaysia's brain drain was intensifying with more than one million of its citizens living abroad and warned the outflow of skilled people could bog down the economy.
Opposition lawmaker Liew Chin Tong said affirmative action based on race was retrogressive, and that help should be given based on needs.
“This is old politics. Most measures are assets and financially based, but there is no real reform to uplift the ordinary Malays. It's a pre-UMNO election ploy,” Liew said.
Najib said his government was still on a reform path and that the projects and support to Malays would be based on merit.