Malaysia: A case of 'business as usual'?

Common, Richard

Abstract

In terms of economic policy, the Asian financial crisis provoked a very individual response from Malaysia. Unlike its near neighbours, Thailand, Indonesia and South Korea, Malaysia refused to countenance the possibility of swallowing the prescriptions of the international financial institutions. Much of this exceptionalism can be attributed to the leadership of its Prime Minister, Mahathir Mohamad. However, Malaysia’s response to the crisis came at the expense of a political power struggle, which left Mahathir’s premiership intact, but not unscathed. On the surface at least, Malaysia’s subsequent recovery from the crisis could be attributable to the fact that its public sector had been exposed to a number of wide-ranging reforms before the crisis broke out, chiefly in the period 1990 to 1996. Since the mid-1980s, there had also been a gradual reduction of the public sector’s role in the economy with an accompanying stress on maintaining macroeconomic stability and encouraging growth. However, Malaysia’s exposure to global economic volatility and its apparent reliance on foreign direct investment to drive its export-led economy appeared to render it extremely vulnerable to the effects of the crisis, and consequently dramatic public sector reform initiatives might have been predicted. In fact, apart from short-term cuts in public expenditure and other measures to stimulate the economy, the Malaysian government has continued to consolidate public management reforms that were already in place before the crisis occurred. The business of the public sector continued very much as usual.

• Publication Date: 2003
• Deposit Date: May 13, 2024
• Publisher: Routledge
• Book Title: Governance and Public Sector Reform in Asia: Paradigm Shift or Business as Usual?
• Chapter Number: 8
• ISBN: 9781138862869
• DOI: https://doi.org/10.4324/9780203221693
• Public URL: https://nottingham-repository.worktribe.com/output/34634603
• Publisher URL: https://www.taylorfrancis.com/chapters/edit/10.4324/9780203221693-8/malaysia-richard-common?context=ubx&refId=dabceefb-f14f-44b7-bc2b-e9dcd462438c