Challenges Faced by Malaysia in Its Journey Towards a High Income Nation at 2020

Educational goals are seen to be an area of great concern in the era of globalization. Universities will continually play a immense role increasing a better society. (S. Chinnammai, 2005)

Malaysia is a country of democracy, a multiparty system. The ruling party Barisan Nasional has been in power for over 25 years. That fact has provided the country with a high degree of stability, which is an important factor for companies investing in the country. Corruption exists in the country. This may be an obstacle for foreign companies, as it increases the company's costs and could cause problems. Transparency International takes 47th Malaysia out of 180 countries in its Corruption Perception

Currently, Australian government seems unable to produce long-drawn-out vision that backings the dramatic flow of universities and research science in East Asia. So under this alterations and improvement occur only in areas with low fiscal implications. The main point is definition and regulation of quality has become primary

For years, brain drain issues have been hot potatoes throughout the world. “Brain drain” is also academically known as the "human capital flight," refers to the large scale migration of highly educated, skilled and talented people of developing countries to highly developed countries of the world (Wikipedia, 2016). The brain drain originated in 1960, when most of human resources like scientists, engineers, and technologists emigrated from United Kingdom to America (Wikipedia, 2016). This phenomenon has become a global issue, and it is happening all over the world in particular for developing countries. China, which is the largest population country with a remarkable economic growth, is also suffering from severe brain drain issues.

Irlisuhana, Zulkhairi, Hafizah, and Suhaiza (2011) found the influx of foreign investments into the manufacturing sector was crucial in its transformation from an agricultural based economy to an industrialized based economy. Over many years, Malaysia has adopted two industrialisation policy and two industrialisation strategies which is the two policies are New Economy Policy and National Development Policy while two industrialisation policies were Import Substitution Industrialisation (ISI) strategy and Export-Oriented Industrialisation (EOI) strategy (“Overview of Malaysian Industrialization”,

Malaysia in the 21st century is confident in its economic achievements and aspires to be a leader amongst Asian nations. Since achieving independence in 1957, it has enjoyed substantial success in reducing the rate of poverty, which stood at 3.7 percent in 2007, accelerating growth, which was an impressive 6.5 in 2010, and maintaining a democratic political system. Malaysia ranks among

The world undeniably becomes “smaller” and “tighter” due to the prosperity of technology and economics, by population movement, information exchange, as well as physical and virtual good trade-offs. In order to be successful when facing the opportunities and challenges in the global and informational age, it is not only helpful but even necessary to use international comparison as an effective public policy tool for administrators and policymakers in the field of Higher Education. Without using international comparison, the educational development speed and potential might be decreased, possible problems happened in other countries might be repeated in our country with large scales of cost and the whole country’s international soft strength and competitive capability might be threatened because of comparatively less competitive human capital, which is mainly produced from higher education.

Born into the newly introduce The Seventh Malaysia Plan. I have grown up in a time of huge economical upheaval. Surrounded by an-ever changing economic environment, I remember asking my father what exchange rates were. In return, when presented with an analogy of supply and demand that involved an array of animals, little did I appreciate that I had come across the basis for economics. I have since observed Malaysia's rapid development, but also evidence of poor macroeconomic management, such as the lingering presence of corruption - crippling to the country's economic stability. Over the years, my initial childhood curiosity has grown into a passion for economics.

Over the last decade, scholars have been assessing the impact of university spill overs. The most significant being knowledge transfer from university to firms. Firms provide the funding for research in universities through what is termed university-industry (UI) partnership/collaboration. This interaction between universities and firms or UI partnerships provides a mechanism by which both parties are rewarded. Industry provides universities with access to resources by funding their research and development agendas. While industry gain from the new knowledge and available technical skills which in turn increase their capacity and efficiency, making them more competitive. More universities have increased interaction with industry over the last few years, especially to reduce the impact of government budget cuts (Cyert & Goodman 1997). Although, the IU partnerships have made significant contributions to economic development across the world, universities in less developed regions, in countries such as Jamaica have not fully capitalized on this phenomenon. The IU partnership is developed through a culture where there is an understanding of the need for scientific knowledge to support innovation and to inform the development of policies and procedures for solving complex problems. The UI collaboration is also influenced by the availability of resources within universities and the extent to which they have the human and non-human capacity to respond to the needs of industry.

The Republic of Singapore celebrated its 42 years of independence in year 2007. Situated at the southern tip of Malaysia, Singapore currently holds a population of 4.68 million as of June 2007. At 704.0km2, it is ranked 4th in the world for its population density. During the past four decades, the economy as measured by real Gross Domestic Product (GDP), multiplied by over 20 times (Ghesquiere, 2007, p.11). As a small and extremely open economy, Singapore long term survival is very much dependent on the ability to maintain its viable position and remain afloat in the sea of global competition (Mun Heng et al, 1998, p.14).

Studies set out in the last decade advise that there is an increasing priority for countries to promote a healthy educational policy to spike development. According to Hanushek and Wößmann, “educational quality – particularly related to developing countries – is THE critical issue” for progress. Cognitive abilities obtained during primary and secondary schooling historically bring about more economic returns. So, there are two main ways in which education can be improved: 1)through increasing quantity and quality. 2)By increasing the amount of schooling, students have more time to develop necessary skills in disciplines such as reading, mathematics, and science. Hence, bolstering the quantity of education should foster human capital, hopefully bolstering productivity in the long-term. Additionally, a more educated workforce has a higher capacity for innovation, helping bring about structural changes to the economy. According to Hanushek and Wößmann (2007, p. 24), “several recent studies suggest that education is an important both as an investment in human capital and in facilitating research and development and the diffusion of technologies.” Hence, increasing the quantity of education helps students gain more familiarity with technology, which encourages future innovation and productivity. However, due to limited research on the subject, Hanushek and Wößmann (2007) are skeptical to make any definitive links between development and the quantity of schooling. Interestingly,

Malaysia is an emerging country with continuously grow in its economy. As announce in 2016 Malaysia budget, Malaysia government lists some objectives of the budget is to strengthening economic resilience by increase the capacity of domestic market and also increase exports. Promoting the well-being of nation by to be more prosperous and easing the cost of living of the people by giving subsidy and fair and equal tax also wealth distributions.

Malaysia’s GDP Annual Growth Rate since 2000 till present. Notice the sharp contraction after the 2008 Financial Crises.

Continuous rapid economic growth has raised Malaysia from an agricultural and commodity-based low-income economy to a successful middle-income economy. As a mixed economy, Malaysia has elements of a free market economy nevertheless with intervention government. Malaysia's economic activity consist of a mixture of sectors whereas mixed of capitalism and socialism The strong economic performance has helped improve the quality of life for Malaysians and supported advances in education, health, infrastructure, housing and public amenities and others.

We Malaysians should support our government in implementing 1 Malaysia. As the saying goes “United we stand, divided we fall”. Vision 2020 could be achieved in time and Malaysia would become a developed country if we are united as