ABSTRACT
Malaysia is an independent nation1 in Southeast Asia comprising Peninsular Malaysia in the west and the states of Sabah and Sarawak in the east. Malaysia is a foundation member of the Association of Southeast Asian Nations (ASEAN) and AFTA (ASEAN Free Trade Area), and of APEC (Asia-Pacific Economic Cooperation), the WTO (World Trade Organization) and the OIC (Organization of the Islamic Conference). The Malaysian development strategy since independence in 1957 has encompassed two important objectives: first, resource allocation to ensure real per capita income growth and second, the equitable distribution of income and wealth. However, prior to 1970, while the policies implemented during this period were able to attain satisfactory growth, they failed to improve equity or significantly eradicate poverty. This growing inequality, overall as well as along intra-ethnic lines, and persistent poverty were said to be proximate causes of the 13 May 1969 ‘race riots’ which culminated in the proclamation of the New Economic Policy (NEP) in 1970.
