KUALA LUMPUR, Sept 7 (Bernama) -- Prime Minister Datuk Seri Najib Tun Razak should use the 2013 Budget as a platform to provide medium-term solutions to the key challenges faced by Malaysia to compete with other developed economies, said the Asian Strategy & Leadership Institute (Asli).

Its chief executive officer, Tan Sri Michael Yeoh, said Malaysia needed to continue making itself attractive and competitive in all areas compared to other neighbouring countries, given that the global focus in Asia now was more narrowed to the South-East Asian economies.

"Although Najib has excellent transformation programmes, the human capital issues in Malaysia must be seriously addressed to realise the transformation agendas, in line with his mission of upgrading the Malaysian economy into a high-income one," he told Bernama here today.

Yeoh said to upgrade human capital, talent and make Malaysia more competitive, the government needed to spend more on the education sector as well as training.

"At the same time, the government must look at areas to reduce the budget deficit, in light of the financial issues faced in the West," he said.

Yeoh said the 2013 Budget was expected to be painless.

"I do not expect any increase in taxes," he said.

Najib, who is also the Minister of Finance, is set to table the budget in Dewan Rakyat on Sept 28, 2012.

Yeoh said Asli was also hopeful the budget would address the needs for affordable housing, better and efficient public transport as well as more effective crime-prevention mechanisms.