New governments pursued three aims: growth, a fairer share of wealth, and national control of the economy. These aims could pull in different directions.
Growth meant raising national income and output, to create jobs and pay for development. Every government made it a goal.
Equity meant reducing poverty and inequality. Malaysia launched the New Economic Policy (NEP) in 1971, after the riots of 1969. It aimed to end poverty and to end the link between race and type of work.
Economic nationalism meant taking control from foreigners. Indonesia seized Dutch firms in 1957-1958. Burma nationalised almost all industry and trade in 1963. The Philippines' "Filipino First" policy of 1958 favoured Filipino businesses.
The aims could conflict. Nationalisation in Burma and Indonesia drove away foreign capital and slowed growth. Singapore put growth first and welcomed multinational companies rather than seeking local ownership.
Priorities changed over time. Many governments moved from nationalism and state control in the 1950s and 1960s towards growth through foreign investment and exports from the 1970s and 1980s.
- Three aims
- Growth, equity, nationalism.
- NEP
- Malaysia, 1971.
- Nationalisation
- Indonesia 1957-1958; Burma 1963.
Worked example: Comparing priorities
Which aim did each government put first?
- Singapore: growth, through foreign investment.
- Malaysia: growth with equity between ethnic groups.
- Burma: nationalism and socialism.
- Indonesia: nationalism under Sukarno; growth under Suharto.
Watch out for this
All governments wanted the same things in the same order.
Priorities differed. Burma put nationalism first and stagnated; Singapore put growth first and prospered.
Check your understanding
What was the main aim of Malaysia's New Economic Policy?
- To end poverty and the link between race and type of work
- To nationalise all foreign companies
- To stop exporting rubber