Over the past few years, the growing gap between rich and poor in developed economies has become a pressing policy issue, Prime Minister Datuk Seri Najib Razak cautioned.
He noted that this was not just the battle cry of the "Occupy Wall Street" protesters, as many research institutions had pointed to the corrosive effect of structural inequality.
"A little inequality encourages individuals to work hard and innovate. But an unequal system creates hollow economies, where wealth and opportunity are kept for the few, at the expense of the many," he said in his keynote address at the prestigious Nikkei 20th International Conference on the Future of Asia "Rising Asia: Messages for the Next 20 Years" here.
"In my country, for example, where income inequality remains a concern, we are working to find the right balance between affirmative action and individual opportunity," he told the almost 700 delegates comprising political leaders, economists and captains of industries attending.
Najib, who is also Finance Minister, stressed that excessive inequality has serious and avoidable effects on health, education and life outcomes.
"When soaring Gross Domestic Product outstrips living standards, people feel they do not have a stake in their nation's economic success. That in turn undermines social progress and threatens stability," he said.
He said with rapid growth at a time of globalisation and technological change, emerging Asia is particularly exposed to widening inequality.
"Over the past two decades, eight out of 10 Asians found themselves living in areas where income inequality is rising, not falling. Whilst inequality has narrowed in emerging regions such as Latin America, it has widened in Asia," he added.
The Asian Development Bank has pointed out that, had inequality stayed static, an extra 240 million people would have been lifted out of poverty.
"So, behind the headline growth figures, it is clear that Asia's future success depends on broader and more diverse economic development.
"For Asia to truly prosper, we must give our citizens greater equity, as well as greater equality. Again, this will not be easy. Even the most successful economies have struggled to tackle inequality.
"There is no straightforward solution. But there are a number of things we can do," said Najib.
Among others, he said, economies must invest more in public goods such as education and health, increase access to quality education, and narrow the divide between urban and rural health outcomes.
"It means strengthening social safety nets, and deploying targeted subsidies that support the poor at the point of need. This is alongside encouraging the private sector to do its part, with corporations providing labour with flexibility, training and support," he added.
According to Najib, there is also a need to build more balanced economies, with higher quality jobs, and more even growth spread across sectors, with a lasting commitment to fight corruption.
"Tackling corruption is not the work of a year, or even a decade, but it can and must be done. Government procurement should be reformed to introduce open bidding, bringing transparency to a process often blighted by graft.
"Strengthening independent anti-corruption institutions, and increasing prosecution of both bribe takers and givers, can help change attitudes, even when corruption is deeply rooted," he said.
Bernama
Thu May 22 2014
Najib delivering his keynote address at the Nikkei 20th International Conference on the Future of Asia. - BERNAMApic
Who is Prabowo Subianto, incoming president of Indonesia?
A wealthy ex-general with ties to Indonesia's popular outgoing president and its dictatorial past, looks set to be its next leader.
Iran's supreme leader says Hamas leader's death will not halt 'Axis of Resistance'
The "Axis of Resistance", built up with years of Iranian support, includes Hamas, the Lebanese Hezbollah group, the Houthi movement in Yemen, and various Shi'ite groups in Iraq and Syria.
Putin says Russia willing to seek compromises between Iran and Israel
Russia is ready to help seek compromises between arch-foes Israel and Iran, President Vladimir Putin said on Friday, saying these would be difficult but possible.
What proposals will Russia push at the BRICS summit?
The proposal is also to establish a BRICS reinsurance company to allow uninterrupted shipment of goods and key commodities between members.
Indonesia's free meals plan in the spotlight as Prabowo readies for office
Prabowo calls the programme one of the main drivers of economic growth, eventually set to add an estimated 2.5 million jobs.
Astro AWANI's revamped English news website, AWANI International, launches on Oct 21
Astro AWANI's revamped English platform delivers in-depth global news and expert analysis to keep you informed on key developments.
Israeli strikes kill 33 people in Jabalia refugee camp in Gaza, medics say
Residents of Jabalia said Israeli tanks had reached the heart of the camp after pushing through suburbs and residential districts.
Liam Payne's ex-partner calls for media restraint after 'painful' death
Cheryl Tweedy used her statement to urge the media to remember they had a seven-year-old son, Bear, who could read the reports.
Analysts: Indonesia's strong MoF leadership team to boost investor confidence
Sri Mulyani Indrawati as head of Indonesia's Ministry of Finance is expected to instil confidence among investors.
Biden offers both a carrot and a stick to Israel as his term nears an end
Israel has frequently resisted US advice and has caused political difficulties for the Biden administration.
Putin says BRICS will generate most of global economic growth
Russian President Vladimir Putin will host a summit of the group in the city of Kazan on Oct. 22-24.
ISIS Malaysia's perspective of Budget 2025
An excellent rakyat-centric budget under the overarching principle of a caring and humane economy.
Budget 2025: Record increase in STR, SARA aid initiatives
The government will provide a significant boost to the Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) initiatives next year.
Budget 2025: EPF contributions to be made mandatory for foreign workers – PM Anwar
The government plans to make it compulsory for all non-citizen workers to contribute to the Employees Provident Fund (EPF).
What policies to expect from Indonesia's new President Prabowo
Prabowo will be open to foreign investment, his aide has said, such as by offering investors management of airports and sea ports.
Budget 2025: Govt allocates RM470 mil to empower women's participation in PMKS
The Women's Leadership Apprenticeship Program will be intensified as an effort to produce more female corporate personalities.
Israel sends more troops into north Gaza, deepens raid
Residents of Jabalia in northern Gaza said Israeli tanks had reached the heart of the camp, using heavy air and ground fire.
Indonesia ramps up security ahead of Prabowo's inauguration
Prabowo Subianto will be sworn in as Indonesia's president on Sunday with Vice President-elect, Gibran Rakabuming Raka, also taking office.
Immediate allocation of RM150 mil for local authorities, DID to tackle flash floods
Datuk Seri Anwar Ibrahim said this allocation is intended to address the recent flash floods that hit the capital and several major towns.
Budget 2025: Sabah, Sarawak to continue receiving among highest allocations - PM
Sabah and Sarawak continues to be prioritised under Budget 2025, with allocations of RM6.7 billion and RM5.9 billion respectively.