KUALA LUMPUR - Malaysian Prime Minister Najib Razak announced on Wednesday night that it would abolish a six-decade-old law that impeded freedom of speech that came as the latest measure under the civil liberty reform promised by Najib's administration.

The colonial-era Sedition Act, which criminalizes speech or publication that incite hatred, would be replaced by a more liberal law that balances between the freedom of speech and protecting racial and religious harmony in the culturally diverse country.

The new National Harmony Act allows the government to act against those who incite hatred against the King and bring up sensitive topics that damage the race relations in the cultural diverse country.

"With this new act we would be better equipped to manage our national fault lines. It will also help to strengthen national cohesion by protecting national unity and nurturing religious harmony," Najib said at a dinner function in Kuala Lumpur.

Najib said the absence of the ideal balance, freedom of speech would be suppressed, creativity hindered and the spirit of chauvinism and extremism promoted.

The government had overhauled since late last year scores of outdated security policies, including the controversial Internal Security Act as part of Najib's political transformation plan ahead of a looming election due before April next year.

The parliament had since earlier this year passed new laws that allow peaceful public gatherings, university students' participation in the political arena and cancel the requirement for press organisations to renew their operating licenses annually.