The Muamalat Newsletter Vol.1 2023

53 FEM Newsletter | June 2023 Introduction Financial planning and economic development are two critical components of sustainable growth for any country. In today’s world, financial planning is crucial in supporting economic development, and economic development can have a significant impact on financial planning. In today’s rapidly evolving global economy, financial planning and economic development have become critical factors that determine a country’s prosperity and growth. Malaysia is a developing country in Southeast Asia, which has witnessed significant progress in economic development over the past few decades. Financial planning is a process of setting goals, assessing financial resources, and creating a plan to achieve those goals. It is important for individuals, businesses, and governments to engage in financial planning to achieve long- term financial stability. On the other hand, economic development refers to the process by which a country, region, or community improves its economic well-being through the development of industry, infrastructure, andother economic activities. Economic development is typically measured by various indicators, such as gross domestic product (GDP), employment, income levels, and poverty rates. The main goal of economic development is to improve people’s lives by creating job opportunities, increasing income levels, and reducing poverty. Effective financial planning can play a crucial role in supporting economic development. By properly allocating financial resources, businesses and individuals can contribute to the growth of industries and infrastructure that are key to economic development. For example, individuals can invest in companies that are working to develop new technologies, while businesses can invest in infrastructure projects that will support their operations and the growth of their industries. This will lead to job creation, increased economic activity, and higher living standards. Another important financial planning strategy employed by Malaysia is the diversification of the economy. The country has diversified its economy to reduce dependence on a single sector, which helps to mitigate the impact of external shocks on the economy. Malaysia has also prioritized the development of high-value industries, such as the technology and service sectors, which have helped to create high-paying jobs and increase the country’s competitiveness globally. Malaysia has also established a robust financial regulatory framework that ensures transparency and accountability in financial transactions. The country’s regulatory bodies, such as the Securities Financial Planning and Economic Development: Towards Digital Economy Author: Dr. Mohd Shukor Harun Faculty of Economics & Muamalat Universiti Sains Islam Malaysia