He said the country must develop and strengthen industry clusters in areas which would be drivers for Malaysia's future growth such as Islamic finance, downstream palm oil and higher value-added electronics.

"Emerging as regional or even global centres or clusters in key areas will provide a resilient and sustainable platform for future growth," he said.

Delivering his keynote address entitled Lessons from Beyond the Dismal Science at the Khazanah Megatrends Forum 2009 here today, Nor Mohamed said Malaysia as a relatively small economy was to remain adaptive to the changing global environment and to build up strong symbiotic relationships.

He said the crisis had accelerated the trend of global growth centred in Asia, particularly, in China, India, Indonesia and the Middle East. "Malaysia is uniquely primed to benefit from the emerging new world order. It is well-positioned in the centre of Asean and Asia," he said.

He said the country could forge partnerships with other countries to jointly access regional markets, particularly in areas such as halal products and Islamic finance.

In his address, Nor Mohamed drew analogies from history, biography and geography and said that in the face of fresh challenges in the current complex world, one should keep an open mind and take a multi-disciplinary approach.

Touching on history, he said the subject taught that it was critical for future success that Malaysians proceeded on the basis of openness to ideas, to change and to each other.

He said openness was not a narrow concept of free trade as promoted by many trade economists, but a broader sense involving willingness to borrow whatever useful from others, including abroad, combined with a willingness to experiment and progress through change.

"Going forward, openness in the context of the capacity for technology absorption and innovation will be critical for Malaysia to realise its developed nation ambitions," he said.

He also said history had proven that cycles of boom and bust would continue to occur going forward.

"Investment history tells us that bubbles are forever. The only question is where and when they emerge. The point is that boom and bust will continue to happen as irrational exuberance, herd mentality and greed will continue to feature in human psychology," he said.

To overcome these, he said planning and financial management must take into account cycles, and that management of debt and risks would continue to be critical going forward.

Nor Mohamed said the best lessons on competition came from biology, where life has been all about competition for survival since life began.

"Biologically, the best chance of survival is really about being adaptive and cooperative. Survival of the fittest is not so much about being best at competing individually but as a community of those best at working together.

"An even superior form of cooperation arises in the form of symbiotic relationships between different species, whereby two species are able to leverage on the comparative strength of each other," he said.

Finally, he said it was crucial to formulate policy by locality and geography, and that this was consistent with the lessons of history and biology, in terms of formulating the best development option for a particular place by taking into account the path of development to date and what would be best adapted for the environment.

"In the Malaysian context, we forge forward towards our ambition of developed nation status, this would imply the need to articulate distinctly a development strategy for each of the major urban centres, including Klang Valley, Penang and Johor Bahru, Kuching and Kota Kinabalu to become developed regions, each with potentially different industry focus," he said.