MSIA MUST URGENTLY REFORM REGULATORY FRAMEWORK

KUALA LUMPUR, Dec 4 (Bernama) -- Malaysia must urgently reform its
regulatory framework to make it proportionate and up-to-date with global
developments, says the National Economic Advisory Council (NEAC).

The reforms must also include reducing business costs and complexity while
enhance the country's productivity and international competitiveness.

The existing regulatory framework is outdated and does not facilitate modern
business, said the NEAC in a report on the "New Economic Model for
Malaysia-Concluding Part", launched by Prime Minister Najib Tun Razak
here Friday.

NEAC recommended a culture of continuous regulatory improvements needed to
be embedded more strongly in government practices.

It said adopting principles of good regulation were among the four measures
required to be taken.

"There are a number of principles to guide the government in developing
sound laws and regulations while assuring that social objectives are also
effectively achieved in a manner that minimises the economic opportunity costs.

"As part of the process of introducing new regulations, public consultation
should be made mandatory," the report said.

The second measure is to remove unnecessary regulatory burden as it weighs
heavily on businesses as 896 agencies, at the federal and state levels,
administer over 3,000 regulatory procedures.

The time needed for getting regulatory approvals in nearly 50 per cent of
procedures is about 14 days each.

The report highlighted as an immediate step in removing unnecessary
regulatory burden, the government should prioritise the review of selected laws
and regulations.

The government should also ensure an effective and efficient enforcement
mechanism as ineffective enforcement has resulted in a lack of compliance with
regulations and must be corrected to match the proposed reduction in regulatory
burden.

"To address this, each regulatory body must undertake and make public the
findings of an annual independent audit on the adherence to their client charter
besides continuous training," the report said.

Another measure recommended included ensuring a successful transition
towards a more effective and coherent regulatory framework via a central
implementing agency charged with managing the critical changes to the existing
regulatory approaches

On liberalisation, NEAC's recommendations included establishing an overall
liberalisation policy framework for the Malaysian economy, applying
cross-cutting implementation processes on liberalisation measures and targeting
immediate liberalisation in selected sectors, commencing with the 12 National
Key Economic Areas sectors for the near-term.

The council said there were no liberalisation policy framework or
coordination mechanism currently to guide government agency efforts in their
respective sectors.

"Nor is there a system to monitor and evaluate the impact and consequences
of previously undertaken liberalisation measures.

"MITI faces significant resistance from agencies in its attempts to compile
liberalisation data and information," it explained.

Therefore, the government should develop a liberalisation policy framework
at the national level, particularly for the manufacturing and non-financial
services sectors, to guide all liberalisation initiatives, including objectives
roadmaps, stakeholder management and implementation issues.

The NEAc also recommended the establishment of a mechanism, potentially a
multi-agency task force, to monitor and evaluate liberalisation impact including
the development of a central database for liberalisation information.

-- BERNAMA