Implementation
The Plan attempted to increase access to medical facilities in rural areas through the formation of the Rural Health Service. District hospital facilities were upgraded to handle referrals from the clinics the Service operated. Medical subcentres were also founded in urban areas, and by the end of the Plan, the gap between rural and urban areas in terms of quality of healthcare had been narrowed, but not entirely eliminated. East Malaysian (Sabah and Sarawak) medical facilities in particular were less-well equipped and staffed than those in West Malaysia (formerly Malaya).
Over M$470.8 million was allocated for education under the First Malaysia Plan. However, less than 70% of this allocation was spent; in particular, the cost of training teachers and technical education had been overestimated. Between 1957 and 1970, the national literacy rate improved from 51% to 59%.
Shortly before the implementation of the First Malaysia Plan, the former colonial masters of Malaysia, the British, announced they would withdraw their defense and economic commitments to Malaysia. As a result, the government sought financial aid from the United States (US) to avoid having the First Malaysia Plan crippled by a lack of funding, going as far as to express support for the Vietnam War, which was unpopular among certain segments of the Malaysian populace. However, Malaysia never directly provided military support for the United States, in accordance with its policy of neutrality, and as a result, failed to receive substantial economic assistance from the US.
The First Malaysia Plan also had to address the problem of unemployment, which reared its head for the first time in the 1960s; despite encouraging growth in the Gross Domestic Product (GDP), employment rates had not grown at a commensurate pace. In addition, there was also the problem of ethnic specialisation in certain professions, with the Chinese dominating the marketplace, the Malays dominating the civil service, and the Indians largely participating in specialist professions such as law. The income disparity between rural and urban areas that the Second Malayan Five Year Plan had sought to resolve was also not satisfactorily eliminated.
In the rural, agricultural-centred areas, the government sought to continue the development that had been first brought about by the First Malayan Five Year Plan. During the tenure of the First Malaysia Plan, over 40,000 acres (160 km2) of rice and other crops in East Malaysia were irrigated. The government also replanted hundreds of thousands of rubber trees to increase rubber yields; in West Malaysia alone, 304,000 acres (1,230 km2) of small holdings were replanted. The government also attempted to rehabilitate inefficient coconut holdings, modernise fishing methods, and provide assistance to poultry and livestock farmers. However, the government also tried to reduce the Malaysian economy's age-old dependence on rubber, developing oil palm cultivation in West Malaysia, and developing the timber industry in Sabah.
The government also offered incentives to industrialise the Malaysian economy by promoting Malay entrepreneurship and upgrading Malay management skills for manufacturing ventures. The Federal Industrial Development Authority (FIDA), established in 1965 but only commencing operations in 1967, sought to accelerate industrial development further and co-ordinate such development. In 1968, new regulations were established that set quotas for Malay ownership of certain enterprises, and the employment of Malays in manufacturing ventures. (Such affirmative action policies were held to be in line with Article 153 of the Constitution.) New industries producing goods for the Malaysian market were required to have at least 51% of their equity in the hands of Malaysian citizens, but industries that would only export goods were permitted to remain entirely in foreign hands. siddiq
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