KUALA LUMPUR, Malaysia (AP) - Malaysia took a big step Tuesday to liberalize its economy, relaxing a host of restrictions on foreign investment, including a controversial rule requiring businesses to be partly owned by ethnic Malays.

Prime Minister Najib Razak announced that listed companies will no longer be forced to allocate 30 percent of their equity to Malays - a requirement that’s long been part of an affirmative action program for the country’s ethnic majority.

Najib said the rule was neither benefiting poor Malays nor was it sustainable amid the global economic slowdown, which will drag Malaysia into its first recession in a decade. The economy is expected to shrink by up to 5 percent this year.