The First Industrial Master Plan (IMP)

Introduction

The first Industrial Master Plan (IMP), 1986-1995 has laid the foundation for the growth of the manufacturing sector. Such rapid growth of the manufacturing sector will have to be sustained in the next decade in order to attain the objective of becoming a fully developed industrialized nation by the year 2020. The first IMP (1986-1995) recommended the continuation of the export-led industrialization strategy. It also placed emphasis on the promotion of the resource-based industries in which Malaysia had already developed a strong foundation.



Objective

The main objective of the first IMP is to accelerate growth
of the manufacturing sectors to ensure prolong fast expansion of the economy and to provide a basis for meeting the social objectives reliable with the New Economic Policy. The first IMP objective also to make the manufacturing sectors become the leading growth sectors of the economy. It also promotes opportunities for the maximum and efficient utilization of the countries abundant natural resources. The other objective is to increase indigenous technology capability and competitiveness with build up the foundation for leap-fogging towards advanced industrial country status in the information age.

Implementation

Malaysia once again had to refocus its industrialization strategy when it reached full employment and could no longer accommodate labor-intensive industries in the early 1990s. The government embarked on a strategy to attract high-technology, capital-intensive, high value-added and knowledge-based industries. In 1995, the share of manufactured exports to total merchandise exports was 79.6%, compared with 32.8% in 1985. By the end of the first IMP period, Malaysia was the world’s largest exporter of air-conditioners, semiconductors, oleo chemicals and latex-dipped products, such as gloves, rubber thread and catheters. Government also proposed a major overhaul of the existing investment incentive and as a result promotion of investment act 1986 was introduced in order to achieve the objective of the first IMP.



Conclusion

The successful growth and transformation of the economy requires the nation to make sure the objective of manufacturing development should be oriented towards increasing efficiency and the implementation of the first IMP is expected to increase manufacturing value-added, improve industrial skills, and create new export niches. Beyond the 1990s, the manufacturing sector will be looked upon not only as a major source of employment creation, but more importantly, as a source of increasing demand for skills labor and the vehicle for enhancing domestic technological capability.