Home From The CEO ‘Challenge’ of Redefining Liberalisation
‘Challenge’ of Redefining Liberalisation

‘Challenge’ of Redefining Liberalisation

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NOT too long ago, the two of the largest economies in the world voted, either through elections or referendum, for a different kind of administration. It was a vote that was apparently based on the sentiment that capitalism had displaced many.

The average man, perhaps trapped in the middle-class in­come, felt that social upward mo­bility had reached its glass ceil­ing, and the system of “fair com­petition” was marred with inequality.

At the end of the day, a sig­nificant population of two of the most advanced economies de­manded change in the way cap­italist governments did business.

This article aims to address the question – does liberalisation truly equate to economic free­dom? Does the capitalistic game require a relook and re-analyse to determine its fairness?

Principally, liberalisation is meant to create more opportu­nities – with negotiating economies deciding the point of equilibrium in which the policies are fair to all stakeholders.

This is done through the rigours of many rounds of dis­cussion, taking into account all economic factors, advantages and disadvantages on all sides – with the negotiator relying on in­puts f om a diverse pool of cross­sectoral experts, based on quan­tifiable parameters.

However, the complication may arise when analysing non-quan­tifiable factors. These factors may be lost in translation, with respect to cultural and socio-eco­nomic peculiarities.

These complications have the tendency to de-contextualise the situational outlook leading to in­accurate representations during the negotiation phase.

Therefore, it is crucial that we quickly learn as a nation to look at such localised peculiarities in the process of gaining market ac­cess. This is because there are obvious inroads to globalised trade when barriers are removed between negotiating markets, but we must recognise all our dis­advantages as they often seem rosier than meets the eye.

At the same time, we must also learn the localised cultural nu­ances of the markets in which we want to penetrate, which may render us at a disadvantage, de­spite our competitiveness in our quality, cost or delivery.

For example, local sentiment is a cultural nuance that may often be overlooked. Many economies, despite their seemingly open markets, place a higher regard for the support of local products, and willing to pay higher if it is made locally while some economies are the complete op­posite. Others may opt for eco­friendly or localised “ethical” sources as products of choice, changing the usual science of de­mand and supply.

An unmistakable fact is that a civilisational advantage of an en­tire century or two is a massive obstacle for developing nations to keep up with. While the world moves towards a globalised, bor­derless world, trade can only be free when the “equal” playing field is fair for all.

Furthermore, exposure plays an important role in the devel­opment of talent within society. For instance, those within devel­oped nations have the advantage of working on highly advanced projects, rubbing shoulders with a large pool of experts – a tech­nical, psychological and cultural experience, which is not as ac­cessible to those in developing nations.

Therefore, the challenge of cre­ating critical mass of talent in itself is a disadvantage for de­veloping nations, in playing the field on equal grounds as their developed counterparts.

To be fair, the “challenge” of redefining liberalisation is not something unique to our country alone. With the advent of the fourth industrial revolution, the norms of doing business and cre­ating job opportunities are changing constantly.

In fact, the dynamic global shifts of industry 4.0 are creating new comparative advantages within the global economy.

While it is indeed important to look at our comparative disad­vantages, it is not meant as a jus­tification of our position, but rather a means of alleviating our shortfalls.

The National Policy on Industry 4.0 (Industry4WRD) is Malaysia’s call for digital transformation of the manufacturing sector and its related services. With that, the government has created a clear path towards ensuring that Malaysian businesses have the leverage in equalising our com­parative advantages.

Most importantly, the unquan­tifiable disadvantages mentioned in this article must come about through a complete societal transformation – one that moves parallel with industry develop­ment and seeping into primary education, social engineering and cultural development.

As a nation at the edge of its last step of advanced nation sta­tus, we must not just practise – but instil in others – the moti­vation to continuously improve.

Let us eliminate wasted mo­tion, pool our experience and turn our shortfalls into advan­tages. The world may challenge liberal economics, but it should not stop us from liberalising our­selves from disadvantage.

The writer is the chief executive officer of Malaysia Automotive institute.

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