The Role of the Private Sector in Higher Education in Malaysia

Abstract

Malaysia’s economic growth since Independence in 1957 has been impressive. The real gross domestic product (GDP) averaged a growth of 6.5% per annum between 1957 and 2005. Malaysia is one of the fastest growing nations amongst the developing countries. It has made great strides in improving the quality of life of its people as well as making advances in the areas of education, health, infrastructure and industry. The country has been transformed from an export oriented economy, which relied mainly on its primary commodities such as rubber, tin and palm oil, a diversified industrial nation. In 1965, Malaysia was the world’s largest producer of both natural rubber and tin, which together accounted for 55% of the country’s export and about 30% of GNP. In fact agriculture alone contributed 34% of the GDP in the same year. In 2005 the share of agriculture was only 8.2%, whereas manufacturing (31.4%) and services (58.1%) contributed substantially to the GDP’s growth. It is evident that Malaysia has made a major shift from an agrarian to an industrial economy. The onset of globalization, combined with the technological revolution, especially in Information and Communication Technology (ICT), has given rise to the knowledge economy, which needs an educated, highly skilled workforce. In 1991, Vision 2020 was announced by the former Prime Minister Tun Dr. Mahathir Mohamad which set the target for the country to be a developed nation by that year. The attainment of Vision 2020 will be accelerated by the strategies enshrined in the National Development Policy (NDP) 1991–2000 and the National Vision Policy (NVP) 2001–2010. The New Economic Policy (NEP) 1971–1990 laid the foundation for the launch of Vision 2020. In 1996, the Multimedia Super Corridor was established with the purpose of making Malaysia one of the leading global ICT and multimedia hubs in the region. Information and communication technology was considered as the next engine of growth in the knowledge economy. This information superhighway project has involved both international and local companies which needed about 30,000 knowledge workers.