Market Must Dictate Digital Economy Not Govt Says Think Tank


 
When launching MyDigital and the Malaysia Digital Economy Blueprint, Prime Minister Muhyiddin Yassin said he expects the digital economy to make up 22.6% of Malaysia’s GDP by 2025.PETALING JAYA: The Center for Market Education (CME) says that the government’s goal of developing the digital economy will only be met if entrepreneurs lead the charge rather than the government.
CME chief executive officer and economist Carmelo Ferlito said these aims cannot be met through policy design alone and must rely on entrepreneurial acumen instead.
“Innovations happen because entrepreneurs smell the presence of unexploited profit opportunities wrapped into new ideas, new production processes or new markets.
“When one of them grasps these opportunities and enjoys a competitive advantage, the transformation process is set in motion and it has to struggle against the old way to do things.”
Economist Carmelo Ferlito.During the launch of MyDigital and the Malaysia Digital Economy Blueprint, Prime Minister Muhyiddin Yassin said he expects the digital economy to make up 22.6% of Malaysia’s GDP by 2025, adding the government planned to create over half a million jobs in the sector.
Ferlito noted that while plans to make it easier for innovators to implement their ideas in the Malaysian market were a positive move, the government must allow the market to decide which ideas stick rather than offering undue artificial support.
“If innovations happen simply because they are policy-induced but they are not consistent with market preferences, we will obtain a technological bubble which will burst once the policy support is withdrawn.
“The consequence will be that the positive effects created by the new technologies will be temporary and the post-bubble economic conditions could be worse than the previous ones.”
He said the government must be as unobtrusive as possible and allow market forces to dictate the growth of the digital economy. - FMT


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