Malaysia has one of the fastest growing economies in the world. Its GDP increased at an annual average rate of 6 per cent in the 1980s and almost 9 per cent during the early 1990s.
The national vision to make Malaysia a fully developed nation by the year 2020 will see a profound shift towards industrialization, leading to the creation of an affluent society. That trend in national development challenges the role of the food and agricultural sector. While facing problems related to production inputs, the sector is also expected to grow with other economic sectors.
Confronted with diminishing trade protectionism, the agricultural sector is left with no other alternative except to be competitive; it must be more productive and efficient and cost competitive in producing products with the desired quality. That requires the support of innovative technologies.
Future world agricultural development will focus on issues pertaining to sustainable production. There will be a pressing need to produce sufficient, high-quality food for a growing population. The global events and changes that will influence the future development of food and agricultural sectors include :
Industrialization and economic growth have both positive and negative effects on the environment. Malaysian economic development has brought large improvements in those environmental problems that are primarily related to poverty and a low level of economic development. Investments in infrastructure, carried out as parts of national development policies, have alleviated a number of environmental problems. Water supply, for instance, has improved significantly and now reaches almost 90 per cent of all households, compared with only 55 per cent in 1980 and 42 per cent in 1970. The sanitation system has also improved significantly. One third of the population had no sanitation facilities in 1980, but that figure fell to 8.5 per cent in 1990 and further decreased in the Sixth Malaysia Plan period (1991-1995).
With economic growth, however, some environmental problems have intensified. For example, agricultural activities and agro-based industries, such as the processing of palm oil and rubber, were among the major sources of water pollution in the 1970s and early 1980s. From around the second half of the 1970s the problem of air pollution, especially in large urban areas, became a matter of concern. (The major sources of air pollution are transportation, fuel combustion and stationary sources). More recently, rapid industrialization has generated large volumes of solid wastes.
To a certain extent, specific regulations introduced under EQA were a reflection of the concerns and magnitude of the environmental problems that had emerged. That was the case, for example, with specific regulations concerning crude palm oil (1977), rubber (1978), clean air (1978) and scheduled wastes (1989). In a similar manner, the regulations covering sewage and effluent (1979), control of lead concentrations in petrol for vehicles (1979), and motor vehicle noise (1987) were introduced following concerns over water quality and health respectively (Sani, 1993).
The exploitation of natural resources also created environmental problems. For example, the development of the timber industry entailed extensive logging. In the case of forestry, the National Forestry Act (1984) now provides the basis for environmental legislation.
Malaysia's economic success has been closely related to its national development policies. For example, IMP, which covered the period from 1986 to 1995, provided a framework for achieving a more diversified and integrated manufacturing sector and for moving towards an advanced industrial economy, in particular by promoting technological capability and competitiveness.
IMP recognized the importance of the market mechanism as well as planning in achieving Malaysia's industrial development objectives. Under that approach, industrial development objectives were set and government policies were subsequently directed towards their achievement. Market forces played an essential role in ensuring allocative efficiency within the framework of the plan. Thus, a main function of IMP was to indicate to private investors the goals and targets of the government as well as coordinate the functions of the public sector in supporting the private sector-led growth, with a view to achieving the objectives of industrial development. IMP achieved its major goals of ensuring industrial growth and diversification inter alia through the development of new manufacturing industries in both resource-based and other sectors.
While providing a comprehensive framework for industrialization, targeting a large number of sectors and also covering support policies in areas such as human resource development, science and technology, and infrastructure, there was no explicit attempt to ensure coherence between industrial development policies and environmental management within the framework of IMP itself. Environmental policies were being developed and implemented separately, principally through the efforts of the Department of the Environment within the Ministry of Science, Technology and the Environment.
Development objectives and environmental management have been integrated, however, within the framework of more recent government plans and policies. One example is OPP2 for the period 1991-2000, which is aimed at accelerating the process of poverty eradication and the correction of social and economic imbalances in the context of a rapidly expanding economy. One of the four principles of OPP2 is a "prudent management of natural resources and the ecology as well as the preservation of natural beauty and a clean environment for the present and future generations".
Furthermore, in recognition of the importance of integrating environmental issues in the overall framework of development, the National Policy on the Environment sets out the principles and strategies necessary to ensure that the environment remains productive, both ecologically and economically. The policy is based on seven principles that harmonize economic development goals with environment imperatives. To ensure that those environmental strategies are being taken into account in the national development strategies, the membership of the National Development Council, which is chaired by the Prime Minister, has been extended to include the Minister of Science, Technology and the Environment.
A clear recognition of the importance of preserving the environment and natural resources in order to ensure that growth and development are sustainable can also be found in "Vision 2020", which aims at transforming Malaysia into a developed country (not only economically, but also socially, politically and in other aspects) by the year 2020, while ensuring sustainability and improving the quality of life.
During the Seventh Malaysia Plan (1996-2000), a plan of action will be drawn up for implementing the different aspects of the national policy on the environment that is being promulgated to ensure long-term sustainability and improvement in the quality of life. Focus will be placed on: providing a framework for an integrated approach to development; enhancing the effectiveness of the regulatory and institutional framework; recommending suitable mitigating measures; improving environmental education; communications and awareness training programmes; and incorporating environmental considerations into resource management and development planning. With the increasing emphasis on an integrated and preventive approach, the institutional framework will be strengthened to ensure the provision of adequate capacity to undertake planning, regulatory and enforcement functions, training and education, and research and development activities. Environmental considerations will be further integrated into decision-making at the federal, State and local authority levels. The actual problem with the effectiveness of the institutional arrangements in Malaysia has been the harmonization between laws and their implementation while faced with inadequate resources such as too few enforcement officers and insufficient funding for enforcement purposes.
During the Plan period, the legislative mechanism will be streamlined at various levels as an integral part of overall project planning in order to reduce the adverse impact of proposed projects. The legal and regulatory framework will be complemented by the use of innovative economic instruments such as: presumptive charges that are payments based on presumed annual total pollution discharge; forest taxes based on impacts of different types of activities; pollution charges based on levels of compliance; and exemptions on import duty, sales tax and special capital allowance for importation of environmentally-friendly machinery. Studies are being carried out to determine the appropriate instruments and incentives to be applied to highly polluting sectors.
The Pesticide Board and related agencies should be strengthened to ensure that only recommended pesticides are used, pesticide residue in the environment is monitored and the appropriate follow-up actions are taken. Legislation should be reviewed to control the field application of pesticides as well as the disposal of pesticide containers. Environmentally-friendly farming methods such as organic farming and the use of non-chemical methods of pest management (e.g., biological control) should be promoted. Programmes to train and educate pesticide users on the safe handling of pesticides, including aspects of environmental protection, should be intensified.
To reconcile trade and environmental conflicts, and promote sustainable development, the coordination of international trade and environmental protection policies should be given high priority. While the government plays a proactive role in formulating policies and strategies to promote fair and equitable treatment in international trade, the private sector should keep abreast of new trading rules. It must be equipped with the ability to adapt to economic instruments, as well as environmentally-related product standards and technical regulations, such as ISO 14000, packaging, labelling, processing and production methods, recycling and intellectual property rights requirements, in order to maintain and improve competitiveness.