KUALA LUMPUR: A new Bumiputera economic policy should see the government playing the role of a facilitator, with the focus on developing more sustainable and competitive businesses funded by equity financing rather than debt financing.
Economy Minister Rafizi Ramli last week announced that the Bumiputera Agenda Steering Unit (Teraju) would be restructured to scale up competitive Bumiputera enterprises, including upgrading them from small to medium enterprises, as part of the government's new Bumiputera economic policy.
Teraju is one of the agencies under the Economy Ministry with the mandate to develop the Bumiputera business and economic ecosystem.
A new Bumiputera policy is expected to be presented at the Bumiputera Economic Congress next year.
UCSI University Malaysia associate professor of finance and research fellow at the Centre for Market Education, Liew Chee Yoong, emphasised the importance of an inclusive and sustainable Bumiputera economic policy with a focus on developing a level playing field, supporting competitive practices and fostering innovation.
He said the ideal role of the government should be a facilitator and regulator, ensuring fair opportunities for all segments of society and mitigating market failures without intervening too aggressively in the market.
"It is not the role of the government to be involved deeply in the activities of business corporations and entrepreneurs unless the market fails or moves in the wrong direction, leading to negative consequences such as environmental degradation, and corporate or business scandals.
"Otherwise, the government should leave it to market forces."
Putra Business School Assoc Professor Dr Ahmed Razman Abdul Latiff suggested a shift to equity financing rather than debt financing, emphasising a collaboration with equity crowdfunding platform providers to protect businesses from high debt financing.
"The Bumiputera economic policy must be geared towards equity financing rather than debt financing. As we have seen during the Covid-19 pandemic, many businesses did not survive due to high-leverage financing.
"These equity crowdfunding platform providers can help companies in their valuation, give them access to venture capitalists and angel and sophisticated investors, do due diligence and compliance, and later provide a secondary market for investors to sell and buy the shares of the company," he added.
Singapore Institute of International Affairs senior fellow Dr Oh Ei Sun proposed an emphasis on excellent work ethics, drawing inspiration from the "Look East Policy" and preparing entrepreneurs for global markets.
"I think more exposure to excellent work ethics such as those espoused in the Look East Policy should be emphasised. Readying them for foreign markets is also important as we are an export-oriented economy.
"For those who are more inward-looking, they should be encouraged to help solve our food shortages by engaging in high-tech farming," said Oh.
Malaysia University of Science and Technology economist Dr Geoffrey Williams, however, took a contrarian view. He suggested the closure of agencies such as Teraju in favour of a standard policy for all Malaysians.
"Rafizi has mentioned a restructuring some of the agencies but actually they should be closed. Assistance should be available to all Malaysians through standard, easy-to-understand policies which do not require interference from civil servants."
He suggested that direct assistance should be made available to all Malaysians through simple and transparent policies.
Teraju was established in 2011 to steer, coordinate and drive the Bumiputera agenda with the aim of increasing the dominance of the group in the national economy.
