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The Problem Of Poverty In Malaysia

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Published: Fri, 19 May 2017

An important component of the fight against poverty in Malaysia was the agreement on the definition and measurement of poverty. In Malaysia, there are three concepts of poverty that we are able to adopt: absolute poverty, absolute hardcore poverty, and the relative poverty. The definition of absolute poverty is when the household’s gross monthly income was not enough to support the minimum of basic need of life such as clothing, health-care, house rent and education. Absolute hardcore poverty defined as condition when the household income was less the absolute poverty as well as the relative poverty is a group of people that their income was less than others. Therefore, to measure all these kinds of condition, a poverty line income (PLI) was created and used by based on basic costs of the items. By eradicate these poverty problem, the Malaysian government wanted to accomplish their strategy by the three policies: New Economic Policy, New Development Policy and New Vision Policy.

One of the policies by Malaysian government to cope with poverty is the New Economic Policy (NEP) for the year 1970 to 1990. The Malaysian NEP was introduced in 1970. It was incorporated as the First Outline Perspective Plan (1st OPP) in 1970-1990 and the Second Malaysia Plan (2nd MP) in 1971-1975 (World Bank, 2004: pp. 1-2). Furthermore, it proceed to be the polices of the Third Malaysia Plan (1976 – 1980), the Fourth Malaysia Plan (1981 – 1985) and the Fifth Malaysia Plan (1986 – 1990). The annual development budgets of the Malaysian government also using these policies as the main reference point. Under the NEP, there are a lots of programmes were implemented, such as resettle the landless and those with uneconomic holdings in new land development schemes, performing in-situ development of existing agricultural land through the consolidation and recovery of land, replanting those old commercial crops with a higher-producing clones and better techniques of planting, improving the educational access by providing text books and assistance of financial for poor households children, supplying infrastructure and social facilities as part of wider program to improve all of the Malaysians quality of life, and modernize their traditional methods of production of economic activities by highly involved in modern farming and non-farm or off-farm activities. The effectiveness and the success of the NEP is a heated debate subject. The NEP has targeted a 30% economy’s share for the Bumiputera. Yet, based on the official government statistics, the NEP didn’t reach the target successfully. In 1990, even though the policy has ended officially, but Malaysians always consult to the NEP because they think it able to bring benefits for the Bumiputera in the future.

On the other hand, the policies by Malaysian government to solve the poverty issue is the New Development Policy (NDP) for the time frame of 1991 to 2000. It was introduced in 1991 as the successor to the NEP in the 2nd OPP (1991 – 2000) and the Sixth Malaysia Plan. The National Development Policy replaced the Malaysian New Economic Policy in 1990 but continued to pursue most of NEP policies (Wikimedia Foundation, 2011). The NDP has introduced the strategy of the balanced development to achieve the target of making a more just and united society. The strategy implicated balancing growth and equity; development of major sectors of the economy; benefits of social and economic development to all Malaysians; development among states and between urban and rural areas; increased material welfare with positive social and cultural values and a greater sense of national pride; a strengthened culture of merit and excellence and the special requirements of the restructuring strategy; science and technology development and socio-economic development; and economic development and environmental protection (World Bank, 2004: pp. 5). Besides, the programme called Development Programme for the Hardcore Poor has established a register on the profile of hardcore poor households to meet their specific needs such as increased their employability and income, well improve housing, food supply for the children and more focused on the assistance of education. The Non-Government Organizations (NGOs) and the private sector also voluntarily involved in helping to eradicate these poverty by provided small loans of busines, industrial training, job opportunities, and educational support for children and better housing. As a result, the NDP stressed on the similar importance to the connection among national unity, poverty eradication, societal restructuring and growth of economic. The NDP has contributed to national development by make it more explicit and to clarify the nature and scope of the balancing requirements.

Besides that, Malaysian government also introduced the New Vision Policy (NVP) for the period of time of 2001 to 2010. The NVP is also guided by the strategic challenges of Vision 2020, which laid out the directions for Malaysia to become a fully developed nation by 2020. It is targets to put up a progressive, prosperous and united of Malaysian population. It effort to establish a competitive and resilient nation, and equitable society with the overriding objective of National Unity. To effectively implement anti-poverty measures, all the relevant programmes and projects were consolidated under the Skim Pembangunan Kesejahteraan Rakyat (SPKR) included the Program Pembangunan Rakyat Termiskin (PPRT) and other related anti-poverty programmes to target an issues of general and hardcore poverty, irrespective of ethnicity in economic sectors which includes both of the rural and urban areas. To further improve the quality of life of the poor and low-income households, the SPKR, through its Program Pembangunan Insan, will continue to inculcate the concept of self-reliance and self-esteem among the involvements of the households and communities. The effect of the policy has ignores the accumulated culture and values or the needs of the Malaysian people. Hereafter, the economy was made vulnerable by unwise resources allocation and excessive dependence on foreign trade and investment.

In conclusion, the Malaysian government has running those policies for the time frame of 1970 to 2010 in order to eradicate the poverty problems in our country. Through all the policies which enforced by the Malaysia government along with the involvement by the private sector, they certainly have tried to minimizing the incidence of poverty through a lot of kind of efforts. However, in the end, its doesn’t reflect the fully success which showed the effectiveness of these policies on poverty eradication. Therefore, the Malaysian government still putting more efforts by solving these poverty issues before 2020 in order to achieve the goal of one of Malaysian policy – Vision 2020.


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