Malaysia's economy regainedmomentum but yearly growth is set to decelerate in 2013.Export recovery into 2014 is expected to offset slowerdomestic demand and lead to a pick-up in growth. Fiscalconsolidation is picking up pace with subsidy cuts, sin taxincreases, and less generous public service bonuses. Thefull implementation of the minimum wage in January 2014 willprovide an additional boost to households, as will increasedcash transfers that are part of the government'sstrategy for subsidy rationalization and modernizing socialprotection. Malaysia performs very well with respect toaccess to education. Enrolments at primary and lowersecondary levels are nearly universal and recent gains inpre-primary education have been note-worthy. Among EastAsian countries that participated in the 2012 Program forInternational Student Assessment (PISA), Malaysian studentsonly outperform their Indonesian peers, and lag evenlower-income countries (including, by a wide margin,Vietnam). Expenditure on basic education is more than doublethat of other Association of Southeast Asian Nations (ASEAN)countries and the decline in learning outcomes occurredwhile inputs to education were expanding and the size of thestudent population was falling. The key constraints toimproving the quality of basic education thus relate not tothe quantity of inputs but institutions. 46 percent ofprincipals report a lack of qualified teaching staff as aconstraint, and Ministry of Education (MOE) admits that inrecent years some candidates enrolling in teacher traininginstitutions did not meet minimum requirements of academicachievement at the secondary level. Lifting theseconstraints entails refining some of the measuresrecommended in the Education Blueprint for high-performingeducation system: (1) moving towards school-baseddecision-making; (2) improving parental involvement andenhancing accountability; and (3) improving incentives andrecruitment for teachers. The government may considerpiloting fixed contract recruitments with tenure contingenton performance, and tying retraining and up-skilling effortswith certification.