Third Thrust: Empowering Education, Skills and Trainings, and Talent Development The Budget 2018 speech by Datuk Seri Najib Tun Razak, Prime Minister and Finance Minister, A total of RM61.6 billion has been allocated to improve education training, skill and talent sector under the 2018 Budget. RM654 million would be used to build 4 pre-schools, 9 PERMATA centres including 2 specifically for autistic children, 48 primary and secondary schools, vocational college and matriculation. A total of RM500 million will be provided to schools in peninsular Malaysia and RM2 billion will be allocated to Sabah and Sarawak. A total of RM550 million would used to improve and maintain of schools. A total of RM2.9 billion for food assistance, textbooks, capital grants and scholarships and the Government will still continue giving the RM100 assistance to about 3.2 million school-going children. The strategy from Third Thrust “Empowering Education, Skills and Trainings, and Talent Development” is the government intent to provide more learning opportunities to Malaysian citizen in order to increase Malaysian education level, worker skills and trainings as well as talent development, from this strategy we can assumes that the Malaysia productivity will increase due to average workers has higher human capital in the future. This strategy can be link with BEC1044 Macroeconomics, Chapter 3 – Production Growth and Business Cycle. This chapter is regarding about a country’s productivity is depending on the factors of production, it includes Physical capital, Human capital, Natural resources and Technological knowledge available to workers. the important thing is a nation’s standard of living is determined by the productivity of its workers. In Budget 2018, the government invests RM61.6 billion to improve education training, skill and talent sector. From this view point, we can predict that the government purpose is to expand and build more school in the society so that more local people has an opportunity to acquire new experience, skills and technology. This tendency will raise the technological knowledge and human capital per worker in Malaysia and this action will also bring benefits to Malaysia’s productivity and GDP. Why? If you take a human capital view of economic development, Malaysia’s economy become more productive as the proportion of educated workers increases, since educated workers are able to be more efficiently carry out the tasks. We can also assume that educated workers acquired technological knowledge through education, training and experience. The advance of technological knowledge has ability to boost up a nation’s economy as well as its will also help our society’s understanding of the best ways to produce goods and services in a given period of time. Now we move to the production function: Y = A F (L, K, H, N), this function is to describe the relationship between the quantity of inputs used in production and the quantity of output from production. For instance: The government can enhance the standard of living by provide school and encourage the population to take advantage of education. For a country’s long- run growth, education is an important as investment in physical capital. If Malaysian citizen have higher human capital, physical capital and technological knowledge in the future, which means this will affect H (Human capital), K (Physical capital) and A (available production technology) increase at the same time, and this will lead to increase the Malaysia’s GDP (Y) and living standard.