OVERVIEW OF POVERTY

ERADICATION IN MALAYSIA

By:
Noriyah Ahmad
Deputy Director General (Macro)
Economic Planning Unit
Prime Minister’s Department
19 June 2007
 OUTLINE

‰ Status of Poverty in Malaysia

‰ Policies and Strategies
‰ Challenges
 Malaysia: Major success in eradicating poverty . . .

60
(% total households)

50
40
30
20
10
0
1970 1980 1990 1999* 2002* 2004*
Total 49.3 37.4 16.5 8.5 6.0 5.7
Rural 58.6 45.8 21.1 14.8 13.5 11.9
Urban 24.6 17.5 7.1 3.3 2.3 2.5
Hard-core poor - - 3.9 1.9 1.0 1.2

3
Note : * Based on Methodology 2005
DATA BASE

‰ Source of data:
‰ Macro planning and policy analysis – Household
Income Surveys
‰ Programme implementation –
‰ Hardcore poor in rural areas – Poverty
registration by Ministry of Rural and Regional
Development;
‰ urban poor – Dept of Stats, Local Authorities
‰ others – Department of Welfare, Baitulmal,
Ministry of Education, Ministry of Health, AIM,
universities, NGOs

4
 REGISTERED RURAL HARDCORE POOR HOUSEHOLDs
Hardcore Poor Households
(till 30 June 2006)
No. State
Productive Non- Total
productive
1. Johor 465 606 1,071
2. Kedah 2,780 1,148 3,928
3. Kelantan 11,346 4,263 15,609
4. Melaka 391 326 717
5. Negeri Sembilan 445 254 709
6. Pahang 947 959 1,906
7. Pulau Pinang 82 129 211
8. Perak 1,793 993 2,786
9. Perlis 785 375 1,160
10. Selangor 530 209 739
11. Terengganu 7,685 1,547 9,232
12. Sabah 14,092 5,482 19,574
13. Sarawak 6,783 3,381 10,164
Total 48,124 19,672 67,806
Source: Ministry of Rural and Regional Development 5
 REGISTERED LOW INCOME HOUSEHOLDS AND URBAN POOR

No. of Households
No State
Poor Hardcore Poor Total
1. Sabah 3,716 984 4,700
2. Terengganu 2,056 1,114 3,170
3. Kelantan 1,927 708 2,635
4. Sarawak 1,922 456 2,378
5. Perak 1,376 605 1,981
6. Kedah 1,285 383 1,668
7. Selangor 736 240 976
8. Kuala Lumpur 596 102 698
9. Pahang 460 177 637
10. Johor 331 217 548
11. Melaka 357 155 512
12. Perlis 298 126 424
13. Negeri sembilan 254 58 312
14. Pulau Pinang 117 41 158
Total 15,431 5,366 20,797
6
Source: Ministry of Housing and Local Government
 POVERTY ERADICATION STRATEGIES

OPP1/NEP (1970–1990)

Strategy “eradication of poverty irrespective of

race” throughout the country
POVERTY ERADICATION STRATEGIES
UNDER OPP1 (1971-1990)

Key Strategies
‰ Provision of basic social infrastructure
particularly education, health and basic services
such as roads, water supply and electricity
‰ Increase productivity and income through
integrated agriculture development (in-situ) and
new land development
‰ Increase opportunities for inter-sectoral
movements from low to higher productivity
activities

8
 POVERTY ERADICATION STRATEGIES

OPP1/NEP (1970–1990)
Strategy “eradication of poverty irrespective of
race” throughout the country
OPP2 (1991–2002)
Continue with NEP and gave special focus to
eradicate the hardcore poor
POVERTY ERADICATION STRATEGIES
UNDER OPP2 (1991-2000)
Key Strategies
‰ Continue OPP1 strategies in providing both social
and physical infrastructures for access in
education, health, product market and employment
mobility (rural urbanization)
‰ Introduction of special hard-core poverty
programmes to increase standard of living with the
provision of decent housing, child nutrition and
maternity health
‰ Micro credit scheme for the hardcore poor to be
involved in income generating activities

10
POVERTY ERADICATION STRATEGIES
UNDER OPP3 (2001-2010)

‰ Eighth M’sia Plan (2001-2005) and Ninth M’sia

Plan (2006-2010)
‰ New Dimensions:
‰ Target specific to address pockets of poverty
(remote areas, indigenous minorities, urban
poor)

11
POVERTY ERADICATION STRATEGIES

OPP3 (2001– 2010)

i. Target specific strategy to address pockets of

poverty in the remote areas, Orang Asli and the
minorities in Sabah & Sarawak, and the urban
poor

ii. To increase the quality of life of bottom 30 per cent

of households ie RM1,200 and below.

iii. Target: eradication of hardcore poverty and halve

overall poverty by 2010
 Thrust To address persistent socio-economic inequalities
3 constructively & productively
The 9th Malaysia Plan, 2006-10

‰ Eradicating hardcore poverty by 2010 as well as halving overall

poverty
‰ Reducing disparities between rural and urban population &
among states & regions via sustainable income-generating
avenues & by improving access to basic needs such as
housing, education, healthcare, utilities & transportation
‰ Developing less developed regions through regional growth
centres
‰ Bridging the digital divide
‰ Addressing inter- and intra-ethnic disparities, particularly by
raising incomes through the enhancement of skills &
capabilities
‰ Promoting equal opportunities in employment towards
reducing disparities in occupation & income as well as
enhancing integration among the ethnic groups
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Incidence of Poverty (Old Metodology )

Rural

Total

Urban
 Malaysia: Major success in eradicating poverty . . .

60
(% total households)

50
40
30
20
10
0
1970 1980 1990 1999* 2002* 2004*
Total 49.3 37.4 16.5 8.5 6.0 5.7
Rural 58.6 45.8 21.1 14.8 13.5 11.9
Urban 24.6 17.5 7.1 3.3 2.3 2.5
Hard-core poor - - 3.9 1.9 1.0 1.2

15
Note : * Based on Methodology 2005
OVERALL POVERTY ERADICATION STRATEGIES
UNDER THE NINTH PLAN (2006-2010)

‰ Focus on human resource development and quality of life

improvements
‰ Emphasize income-generating projects
‰ Intensify human capital development through educational
and training programmes
‰ Rural development:
- Land & agriculture development
- economic development such as aquaculture project
- Marketing channels, credit micro assistance
- Infrastructure/rural roads, electricity, etc
‰ Others:
- Health care, scholarship, text books, food
supplements, low-cost housing
- to promote private sectors & NGOs to play role in
complementary poverty eradication

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Poverty Programmes and Allocation
under Ninth Malaysia Plan

RM (million)

Programmes for Overall Poor 1,007.00

Hoeseholds
Rural Hardcore Poor 841.00
Households
Uban Poor Households 2,150.00

FELDA’s Contribution (Sabah) 170.00

Others – digital divide 3,700.00

TOTAL 7,868.00
17
Poverty Programmes and Allocation
under Ninth Malaysia Plan
Operating Budget
2007
RM (million)
Ministry of Education 1,000.00
Ministry of Health 1.5
Department of Welfare 242.00

TOTAL 1,243.5

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 CHALLENGES
‰ Target: eliminate hard-core poverty and to halve
general poverty to 2.8 per cent by 2010
‰ reduce spatial and ethnic inequalities (Gini = 0.462
in 2004)
‰ improve quality of data and coverage - gaps in data
‰ ensure the right strategies and programmes for the
right target groups
‰ Improve monitoring and coordination

19
Thank You
www.epu.jpm.my

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 Incidence of Poverty, 2004

Strata Incidence of Poverty (%)

Overall Poverty Hardcore Poverty

Peninsular Malaysia 3.6 0.7

Sabah 23.0 6.5

Sarawak 7.5 1.1

Malaysia 5.7 1.2

Source: HIS 2004 21