ABSTRACT
Massive inflows of FDI into the manufacturing sector also caused tightening of the
labour market by the mid-1990s (Ariff 1991; Rasiah 1995a). The focus of industrial pol-
icy shifted towards industrial deepening as the government attempted to take advantage
of low unemployment levels (which reached 2.7% in 1995) to stimulate structural change
into high value-added activities. Following the introduction of the Way Forward initiative
by the government in 1991 targeted at making Malaysia a developed economy by 2020, a
series of instruments were introduced to promote industrial deepening, alongside the
Action Plan for Industrial Technology Development (APITD) of 1990 (Malaysia, 1991a).
