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Najib drops Bumiputera quota for services sector
KUALA LUMPUR, April 22 - Datuk Seri Najib Razak today freed the country’s services sector by ending the 30 per cent Bumiputera equity rule in an attempt to improve Malaysia’s competitiveness in the
softening global economy.
The Prime Minister, who is also the finance minister, promised further liberalisation, saying that he would announce details of the liberalisation of the financial sector next week.
Reading from a prepared statement the Prime Minister said he expected a greater flow of foreign investments in the services sector which currently forms 11 per cent of total investment.
“Recognising the growth potential in the services sector, the government has decided to immediately liberalise 27 services sub-sectors, with no equity condition imposed. These sub-sectors are in the areas of health and social services, tourism services, transport services, business services and computer and related services,” said Najib.
The government, he added, would also allow foreign legal firms to practice in the country but to only offer services in Islamic finance.
“As part of the measures to develop Malaysia as an international Islamic financial hub, the legal profession will be liberalised to allow up to five top international law firms with expertise in international Islamic finance to practice in Malaysia,” said Najib.
Other services liberalised are in the areas of health and social services, tourism services, transport services, business services and computer and related services.
Najib also announced an allocation of RM100 million to be managed by the Malaysian Industrial Development Authority (MIDA) to strengthen the local services industry in facing the liberalisation.
“The liberalisation initiatives will not adversely affect the domestic services industry. The government will continue to support the industry in capacity building and in the opening up of export markets,” said Najib.
When asked on the sub-sectors selected to be liberalised, Najib said it was part of Malaysia’s commitment to Asean on liberalisation.
“It’s in line with what Asean countries are doing. Some (of our measures) are better,” he told reporters.
Najib however refused to give out details on the liberalisation of the financial sector.
“I want it to be full of surprises,” he said.