Bankruptcy now firmly in sight: Are political games being played to hide this?... by Maclean Patrick

Bankruptcy now firmly in sight: Are political games being played to hide this?
Written by  Maclean Patrick
Tuesday, 07 June 2011 15:39

Amidst all the racial and religious rhetoric served up by the politicians of the day, Malaysia is facing a far greater problem. The various political entities in Malaysia can throw all the mud they want at each other, and fight over who should be the next this and that, but if left unchecked; there may not be much of a country to govern within the next two to three years.

Bank Negara have just released the 1st Quarter economic and financial data for Malaysia on the 3rd of June and it paints a grim picture.

For the 1st quarter of 2011, the central government debt sits at RM430,151 million compared to RM407,101 million for the same period in 2010, i.e up RM23 billion. Of the RM430,151 million, RM425,831 million is medium and long term debt.

Domestic debt sits at RM414,217 million whereas in the same period in 2010 it sat at RM390,356 million. Again the medium and long term debt is the bigger bulk of the debt at RM409,897 million.

Plainly stated, the Government of Malaysia owes the central bank and funds like the Employee Providence Fund monies that run into the billions. Such debts are a mystery when you take into account that the central government operational expenditure has actually decreased. For April of 2011, the figure stands at RM13,769 million; a reduction compared to RM19,416 million for the same period last year.

Bear in mind the figures above are for the first quarter of 2011, there are still eight more months to go for 2011, and this figure would surely be on the rise if we take into consideration the pending General Elections and various other government initiatives.

Does GOM even know what it is doing?

The next key thing to note is that while the GOM has reduced its expenditure, yet it has increased its debt.

And unless the debt is managed well, we are on the verge of seeing the GOM going the way of the Greece government. A government broken under the weight of its own debt.

And if the GOM goes bankrupt than the people of Malaysia would in turn suffer since the money the GOM owes is taken from public funds that belongs to everyday Malaysians.

Can the GOM repay its monetary debt to the people of Malaysia?

Adding to the grim picture, figures released by BNM for April 2011 show a country where inflation is on the rise. Headline inflation, measured by the Consumer Price Index (CPI), increased to 3.2% on an annual basis. Higher prices for food and non alcoholic beverages along with higher cost in the transport categories are contributing to the ever-rising inflation rate.

An increase in RON97 from RM2.50/litre to RM2.70/litre accelerated the upward adjustment in the transport category. The impact would be greater as the Najib administration toys with the idea of reducing subsidies in an effort cut down on governmental expenditures.

While the idea to raise prices for RON95 has been shelved for the time being, Putrajaya announced a 7.1% hike in electricity tariffs in an effort to trim a subsidy bill that would otherwise double to RM21 billion this year, promising that the hike would not affect three-quarters of domestic users. A move some say would anger voters in the coming elections.

What should a PM do?

In a critical report published by the Singapore Strait Times, economists raised the question whether resource-rich Malaysia had fallen out of step with the global environment.

The Straits Times reported the arguments by economists that decades of state intervention that sought to meld free market practices with an ambitious social agenda to restructure the country’s multi-ethnic society in favour of politically dominant Malays had sapped Malaysia of its competitive edge as a destination for foreign investment.

Malaysia is slowly losing out on the global stage while the GOM is floundering within its own debt.

This is a problem far removed from the smoke-screen of sex tapes, sodomy trials, and mud-slinging so prevalently broadcast to the Malaysian public. Yet, it is this grim reality, that Malaysia is headed towards bankruptcy, that has drawn so little effort to remedy from the Najib administration.

Should not Malaysians demand a Prime Minister, whoever he or she may be, spends more time governing the country and the economy rather than politicking and creating political and economic trouble for himself, his party and worse of all, the innocent people who were foolish enough to have voted for him.

As they say, once bitten, twice shy.

Aliran: Corruption, cost of living, and the need for good governance — by John Inbaraj

Corruption, cost of living, and the need for good governance — John Inbaraj

Aliran, April 10, 2011

 

APRIL 10 — The Star reported, “[a] Customs director had millions of ringgit spread over several bank accounts. Another had almost 1 million. Two others had between 500,000 and 850,000 ringgit.” Not only that, gold bars, bags of cash, luxury watches and posh cars were among the goods involved in raids that resulted in 62 officers arrested for under declaration of duties and tax evasion (April 3, 2011, “Ill-gotten stash”).

To be more specific, about RM10 billion has been smuggled out or remitted overseas. Customs officers had also admitted to collecting RM100-500 for every declaration form (K1) submitted and approved (an act that s been openly going on for decades).

And RM108 billion has been estimated lost annually in unpaid duties and income tax. One officer had gold bars in his house while another had RM600,000 cash in several bags in his house.

Do we congratulate the MACC for some great work or do we condemn the government and the MACC for their continuous inefficiency to tackle corruption to such a drastic extent?

Recently, Idris Jala, the minister in the Prime Minister’s Department, reiterated that excessive government subsidies had threatened to make the country bankrupt by 2019! These subsidies are small amounts compared to the billions lost in corrupt practices.

It is impossible to understand how the Prime Minister’s Department in particular and the government in general can tolerate such brazen corruption. It is even more difficult to understand why there are people still voting for the same government.

The standard of living among Malaysians has reportedly gone up. But the reality is that the cost of living has also gone up tremendously. A green apple costs over RM1 and a kilo of infant formula milk is in the region of RM25.

The government rates hardcore poverty level income for at RM440 per month for a household. These figures tell us that people are still living under “poverty” conditions due to the high inflation rate in relation to their monthly income.

Is this reality a reflection of lack of enforcement in government or has corruption become institutionalised in the government?

Do you remember the day when Dr Mahathir Mohamad blasted the then Auditor-General Ahmad Noordin for highlighting Bank Negara’s dabbling in the global foreign exchange market, which eventually resulted in RM10 billion in losses?

Dr Mahathir delivered a body blow to the credibility of the auditor general and his report. Such an act highlighted serious shortcoming in our government system, especially in tackling corruption. What has become of the respect for the auditor general and his annual report remains unanswered. Has anyone been charged for overpaid screwdrivers and car jacks?

Another incident in the recent past involved the supply of goods and services to the army and police departments. The suppliers were charged for delivering sub-standard goods and services. Under normal practices, quotations are requested from suppliers and samples are reviewed before an order is placed.

The goods are checked by the receiving departments — in this case, the police and the army — for conformance of quality and quantity before an acknowledgement of receipt is issued. Why was the charge targeted at the suppliers and not the police and army departments? Were there any insiders nabbed and charged?

There are many unresolved issues in the conduct of particular agencies in this matter. Such blatant condoning of wrongdoings has encouraged corrupt practices across the length and breadth of this country.

Enforcement has lost its place in the fight against corruption. The RM108 billion losses alone bear testimony to this. This figure represents only a fraction of losses in the Customs Department. What colossal figures are we talking about if we include other relevant authorities and numerous other agencies and commissions?

The inefficiency in governance also takes place at a micro level. On roads, the demerit system is in shambles. Summonses are issued with no proper tracking of settlement. Accidents are aplenty but all is blamed on the drivers’ attitudes. But when a traffic offence is met with quick police action, would it not deter offenders?

In fact the reverse is true. When someone who follows the law ends up becoming the victim in time and time again, would it not frustrate that individual and force him or her to breaking road regulations? Queue-jumpers do so without a care and by the thousands. Authorities keep shouting. Why not just catch them?

The rich get richer while the poor struggle to make ends meet. Housing prices have gone haywire. Many who were born and lived in landed properties have moved to high-rise properties that have no proper laws or enforcement. Criminal acts and gangsterism have soared; this is especially evident among the younger generation due to the work schedule of their parents’ 12-hour days to feed their families.

Imagine what the RM108 billion (plus the yet undetected billions) can do to help alleviate the suffering of the poor.

To the prime minister of acronyms, I urge you to forget all of them (GTP, ETP etc, etc). I propose WOC (Wipe Out Corruption) and ELC (Enforce the Laws of the Country). — aliran.com

NST: Why ex-envoy Malott has got it all so wrong... by Johan Jaaffar

Why ex-envoy Malott has got it all so wrong

by Johan Jaaffar

NST 12 Feb 2011

I FIND it mindboggling that the former United States ambassador to Malaysia, John R. Malott, could be so wrong in his assessment of the current state of racial relations in this country ("The Price of Malaysia's Racism" -- Asian Wall Street Journal, Feb 8). It was written sadly at a time when the US and Malaysia are enjoying their best ever relationship thanks to President Barack Obama and Datuk Seri Najib Razak. I can understand the ouster of then deputy prime minister Datuk Seri Anwar Ibrahim would still haunt Malott to this day. He has, of course, every right to make his own judgment of what happened back then. For the record, it took place 13 years and two prime ministers ago, historically speaking that is.

I am sure we have all moved on even if he has not. Too many things have changed since then. One positive thing Malott should understand is that freedom of speech and expression has reached new heights as a result of that incident. Malaysians are becoming more open, more vocal and more assertive. The Internet has changed the way people perceive the government, the media and themselves.

Malott should be proud of that fact if he is at all a supporter of all things free and open. The alternative spaces are widening, bloggers are having a field day and people's journalism is making inroads. We have seen the repercussions of that "open policy" -- Barisan Nasional was punished, rightly or wrongly, at the last general election. BN accepted the fact. But BN stands by its motto that this country is better ruled by a coalition of race-based parties than those based on chauvinistic dogmas and fundamentalist leanings.

It is so easy, if Malott had paid some attention while he was here, to play to the gallery. Just play the racial card. Portray oneself as the champion of a particular race. The temptation is irresistible. But BN and the parties in the coalition choose not to, the bigger agenda supersedes short term gain.
In a country like Malaysia, it is easy to create racial tension -- a cow's head, slices of pork, destruction of temples and mosques -- all hell can break loose. Just like that. But that is not the Malaysian way. We have survived despite our problems these many years. After all, we are not perfect.

Just last week, I wrote about the imperfections that I noticed in race relations in this country over the years. In "a bubbling, bustling melting pot of races and religions", it is impossible to be perfect. We are just too diverse, too different. But that does not mean we cannot live alongside each other. We have a reasonably good record in race relations management compared with many other countries. But why should we compare ourselves with others? The US, too, has its racial problems the last time I checked.

Perhaps Malott spends too much time listening to a hotchpotch of diplomatic gossip and irresponsible murmurs, so much so that he finds it difficult to differentiate fact from fiction, truth from hearsay. He was here when Malaysia registered the best ever economic growth. He didn't sound a warning bell about economic discrimination back then. He saw what happened to the region in 1997. He can't blame it on bad governance here when South Korea, Thailand, Indonesia and Singapore were badly if not worse hit. But we did not see turmoil as experienced by some of our neighbours.

The fabric of our society was intact even during the economic meltdown. We have addressed the racial imbalance economically, thank God, after 1969, though the policy was said to discriminate. The Chinese tauke, the Malay tokoh korporat and the Indian businessman were all hit.

The New Economic Policy (NEP), despite being savagely condemned, had achieved some of its desired results. At least it addressed the very issue that has bedevilled all multi-racial societies -- the danger, as Amy Chua rightly pointed out in her book World on Fire, of "market-dominant minorities". The NEP was not carved out from the Robin Hood principle of stealing from others to give to the Malays. The others are prospering, in fact more so after the implementation of the NEP that some segments of Malay society felt they would forever be left behind. The policy favouring the Malays has helped the rise of a new middle class among them, many of whom, for the record, are not enthusiastic supporters of the government. BN has to live with that.

Why invoke Perkasa's position when even the Malays themselves are nervous about it? There are tendencies of raucous chauvinism in the vernacular press -- the trend, while unhealthy, is certainly in line with Malott's notion of an open society. The media -- mainstream or otherwise -- is pushing the envelope and cyberspace has become a lawless domain. The government is not in the business of closing newspapers, suing bloggers or even censoring the Internet. But openness and freedom must come with responsibility. You don't need to go to journalism school to know there is such a thing as the S-word here. There are sensitivities we have to observe or else we will end up with anarchy.

While I agree that many of our people are working outside the country, I find it hard to believe that just because millions of Britons, French, Germans and others work in the US, these nationals are abandoning their country or unhappy with certain policies. We are dealing with a global economy and this is a global phenomenon. People have been crossing borders for better lives since time immemorial.

While it is true many of those working abroad "are skilled ethnic Chinese and Indian Malaysians", let's not forget that the Malays are also complaining that their children are not coming back after their graduation overseas. The brain drain involves Malay young men and women, too. It is not that they love Malaysia less, it is the lure of better pay and opportunities. To cite that "500,000 Malaysians left the country between 2007 and 2009" is an exaggeration at best, irresponsible at worst.

It is easy for Malott to bring up one or two incidents involving ministers or aides to portray the government as not sensitive to other religions. To say that racial instability is one reason for foreign investors to shy away from Malaysia negates the fact that Malaysia remains competitive among many emerging markets. We are not expecting Malott to understand the economic reforms made by the prime minister or his 1Malaysia campaign to unite the people.

Sadly, this old Malaysia hand, if he wants to label himself so, is just too far away and too far off the mark to understand the changing dynamics of this country.

Read more: Why ex-envoy Malott has got it all so wrong http://www.nst.com.my/nst/articles/17malot/Article/#ixzz1DjEB9SvT

TMI: The price of Malaysia’s racism — by John R. Malott

The price of Malaysia’s racism — John R. Malott

TMI: February 08, 2011

FEB 8 — Malaysia’s national tourism agency promotes the country as “a bubbling, bustling melting pot of races and religions where Malays, Indians, Chinese and many other ethnic groups live together in peace and harmony.” Prime Minister Najib Razak echoed this view when he announced his government’s theme, 1 Malaysia. “What makes Malaysia unique,” Najib said, “is the diversity of our peoples. 1 Malaysia’s goal is to preserve and enhance this unity in diversity, which has always been our strength and remains our best hope for the future.”

If Najib is serious about achieving that goal, a long look in the mirror might be in order first. Despite the government’s new catchphrase, racial and religious tensions are higher today than when Najib took office in 2009. Indeed, they are worse than at any time since 1969, when at least 200 people died in racial clashes between the majority Malay and minority Chinese communities. The recent deterioration is due to the troubling fact that the country’s leadership is tolerating, and in some cases provoking, ethnic factionalism through words and actions.

For instance, when the Catholic archbishop of Kuala Lumpur invited the prime minister for a Christmas Day open house last December, Hardev Kaur, an aide to Najib, said Christian crosses would have to be removed. There could be no carols or prayers, so as not to offend the prime minister, who is Muslim. Hardev Kaur later insisted that she “had made it clear that it was a request and not an instruction,” as if any Malaysian could say no to a request from the Prime Minister’s Office.

Similar examples of insensitivity abound. In September 2009, Minister of Home Affairs Hishammuddin Hussein met with protesters who had carried the decapitated head of a cow, a sacred animal in Hinduism, to a Hindu temple. Hishammuddin then held a press conference defending their actions. Two months later, Defence Minister Ahmad Zahid Hamidi told Parliament that one reason Malaysia’s armed forces are overwhelmingly Malay is that other ethnic groups have a “low spirit of patriotism.” Under public pressure, he later apologised.

The leading Malay-language newspaper, Utusan Melayu, prints what opposition leader Lim Kit Siang calls a daily staple of falsehoods that stoke racial hatred. Utusan, which is owned by Najib’s political party, has claimed that the opposition would make Malaysia a colony of China and abolish the Malay monarchy. It regularly attacks Chinese Malaysian politicians, and even suggested that one of them, parliamentarian Teresa Kok, should be killed.

This steady erosion of tolerance is more than a political challenge. It’s an economic problem as well.
Once one of the developing world’s stars, Malaysia’s economy has underperformed for the past decade. To meet its much-vaunted goal of becoming a developed nation by 2020, Malaysia needs to grow by 8 per cent per year during this decade. That level of growth will require major private investment from both domestic and foreign sources, upgraded human skills, and significant economic reform. Worsening racial and religious tensions stand in the way.

Almost 500,000 Malaysians left the country between 2007 and 2009, more than doubling the number of Malaysian professionals who live overseas. It appears that most were skilled ethnic Chinese and Indian Malaysians, tired of being treated as second-class citizens in their own country and denied the opportunity to compete on a level-playing field, whether in education, business, or government. Many of these emigrants, as well as the many Malaysian students who study overseas and never return (again, most of whom are ethnic Chinese and Indian), have the business, engineering and scientific skills that Malaysia needs for its future. They also have the cultural and linguistic savvy to enhance Malaysia’s economic ties with Asia’s two biggest growing markets, China and India.

Of course, one could argue that discrimination isn’t new for these Chinese and Indians. Malaysia’s affirmative action policies for its Malay majority — which give them preference in everything from stock allocation to housing discounts — have been in place for decades. So what is driving the ethnic minorities away now?

First, these minorities increasingly feel that they have lost a voice in their own government. The Chinese and Indian political parties in the ruling coalition are supposed to protect the interests of their communities, but over the past few years, they have been neutered. They stand largely silent in the face of the growing racial insults hurled by their Malay political partners. Today over 90 per cent of the civil service, police, military, university lecturers, and overseas diplomatic staff are Malay. Even Talent Corp, the government agency created in 2010 that is supposed to encourage overseas Malaysians to return home, is headed by a Malay, with an all-Malay board of trustees.

Second, economic reform and adjustments to the government’s affirmative action policies are on hold. Although Najib held out the hope of change a year ago with his New Economic Model, which promised an “inclusive” affirmative action policy that would be, in Najib’s words, “market friendly, merit-based, transparent and needs-based,” he has failed to follow through. This is because of opposition from right-wing militant Malay groups such as Perkasa, which believe that a move towards meritocracy and transparency threatens what they call “Malay rights.”

But stalling reform will mean a further loss in competitiveness and slower growth. It also means that the cronyism and no-bid contracts that favour the well-connected will continue. All this sends a discouraging signal to many young Malaysians that no matter how hard they study or work, they will have a hard time getting ahead.

Najib may not actually believe much of the rhetoric emanating from his party and his government’s officers, but he tolerates it because he needs to shore up his Malay base. It’s politically convenient at a time when his party faces its most serious opposition challenge in recent memory — and especially when the opposition is challenging the government on ethnic policy and its economic consequences.

One young opposition leader, parliamentarian Nurul Izzah Anwar, the daughter of former Deputy Prime Minister Anwar Ibrahim, has proposed a national debate on what she called the alternative visions of Malaysia’s future — whether it should be a Malay nation or a Malaysian nation. For that, she earned the wrath of Perkasa; the government suggested her remark was “seditious.”

Malaysia’s government might find it politically expedient to stir the racial and religious pot, but its opportunism comes with an economic price tag. Its citizens will continue to vote with their feet and take their money and talents with them. And foreign investors, concerned about racial instability and the absence of meaningful economic reform, will continue to look elsewhere to do business. — The Wall Street Journal

* John R. Malott was the US Ambassador to Malaysia, 1995-1998.

The Star: The mystique of national transformation... By TAN SRI LIN SEE-YAN

The mystique of national transformation

By TAN SRI LIN SEE-YAN

The Star, Saturday January 1, 2011

The challenge is to convince stakeholders to buy in and take ownership of the array of programmes.

I am often asked: What is this New Economic Model (NEM) all about; how is this related to the Economic Transformation Programme (ETP) and Government Transformation Programme (GTP); what has all this got to do with creating a high-income society; and what is this middle-income trap we are caught in; and why the urgency for national transformation.

Since the idea of NEM was first mooted by the Prime Minister in mid-2009, our vocabulary has been enriched (or debased) by a barrage of upbeat words (economic roadmap, transformational journey, squeezed-in-the-middle, social minefields, talent management, managed liberalisation, catalysing change, etc.) some of which boggle the mind, and new acronyms (NEAC, GNI, NKEAs, NKRAs, SRIs, EPPs, BOs, 10MP, IEB, Permandu and GOA, Greater KL/KV, etc.).

All enough to confuse most, let alone know what they stand for and to understand the complex web of inter-relationships among them.

No wonder the public seems confused. Many businessmen, investors, civil servants and even academics are not sure they understand enough to lend a deep insight into how the various parts fit together and how they relate to what they are doing. Let alone fully appreciate the whole scheme of things in order to be able to buy in.

After all, the entire framework, strategies and policies and the manner they are stitched together are rather complex. Going through the maze of close to 2,000 pages of inter-related technical reports and discourse, and understanding what they really mean in terms of practical implementation, was rather onerous. Unless stakeholders appreciate enough to buy in and take ownership of the array of programmes, no amount of political will and leadership commitment can see them through in practice. That's the challenge, I guess.

Middle-income trap
It is a fact that middle-income economies (MIEs) have grown less rapidly than either most rich or poor countries which account for the lack of convergence in the past 100 years. So, middle-income nations get squeezed-in-the-middle, between low-wage poor-nation competitors (that dominate in mature or old industries) and rich-country innovators (that dominate new activities based on technological change).
East Asian nations today face this challenge, especially Malaysia and Asean. Economic theory postulates that MIEs face three transformations as they evolve: (i) diversification slackens and then reverses as they get more sophisticated and specialised; (ii) fixed investment assumes less importance as innovation gathers steam; and (iii) quality of education shifts to enable workers to readily absorb new skills and technologies to increasingly add value to the production process.

These are observable outcomes as MIEs successfully shift their growth strategies.

But in the absence of economies of scale, East Asian MIEs will need to struggle uphill in their attempt to maintain previous high growth rates. Strategies based on continuing capital accumulation will deliver steadily worse results. Simply because the law of diminishing returns soon sets in.

Many nations in Latin America and the Middle East are examples of MIEs that have not been able to get out of this middle-income trap.

For East Asia, however, I see room for optimism. World Bank studies have shown that some MIEs in East Asia have successfully made this transition from middle income to rich under proper environments driven by private enterprise, and adopting correct policies. Studies show some MIEs (e.g. South Korea and Taiwan) have remained successful manufacturers even in rather mature industries. Also, China, Taiwan, South Korea and India have shown that success in knowledge-based industries and services can be had. For these MIEs, the tactic has been to straddle both strategies.

Clearly, exploiting economies of scale does offer a way out. The World Bank experience shows “the pattern of trade, the flow of ideas and innovations, the new financial architecture, and the performance of cities are all consistent with East Asian economies displaying a shift towards growth that is founded on economies of scale.”

However, it comes at a price: distributional consequences in terms of rising inequalities, widespread corruption, persistent crime and lack of social cohesion are symptomatic of this model. Be that as it may, transformational change is what is needed if we are to get out of the middle-income trap. There is no other way.

NEM, ETP and GTP
Hence, the NEM for Malaysia. Designed to provide a “concerted, holistic roadmap” to raise income and living standards over the next 10 years, its goals are anchored on strategies outlined in the ETP and GTP. It targets growth in gross national income of at least 6% a year. By 2020, income per capita is expected to reach US$15,000 (RM48,000), enough to become a developed nation.

To achieve this, the ETP identifies eight strategic reform initiatives (SRIs) to propel transformation and growth, namely, promoting a private-sector led economy; creating a quality workforce; instilling competition; strengthening the public sector; building knowledge-base infrastructure; enhancing sources of growth; ensuring growth sustainability through innovation; and implementing transparent and market-friendly affirmative action. Strategically, this makes a lot of sense. But, it's a tall order by any standard.

On the ground, the ETP roadmap identifies 12 National Key Economic Areas (NKEAs) in its drive to maturity these represent growth engines identified to bring about high incomes through constant value adding. They are: oil and energy; financial services; palm oil; wholesale and retail trade; tourism; electrical and electronics; business services, education, communications, content and infrastructure; health tourism; agriculture; and the Greater KL areas.

The ETP needs to be private-sector driven, with Government shifting its role from financier to facilitator. The implementation of the ETP complements the transformational push of SRIs. The outcome is expected to be a more balanced and more sustainable economy. Bear in mind that SRIs are intended to deal with foundational economic issues underpinning transformation and growth.

However, success of the ETP rests on four key underlying thrusts. The first involves the creation of an innovative and creative culture. To thrive, this needs an ecosystem that inculcates private enterprise and risk-taking which flourish best in a competitive and regulatory-friendly environment.

The second addresses the presence of a reliable flow of quality workforce incubating in a conducive workplace.

The third deals with a revamped Government able to transform its service delivery system. This requires a Government “embedded” in support of private initiatives, but not “in bed” with investors.
Only a quality civil service instilled with fiscal discipline can deliver this.

And the fourth tackles the issue of inclusiveness and the need to reduce disparity often collateral damage from unfettered laissez faire private participation, in the absence of checks and balances. This thrust is critical for social cohesion in the face of a strong push for growth. For without growth, there will not be enough to redistribute.

The GTP in conjunction with the ETP form an integral part of the NEM. The GTP is intended as the implementation roadmap to improve performance of the government engine. Here, six National Key Result Areas (NKRAs) have been identified as critical: reducing crime; fighting corruption; transforming education; reducing poverty; improving rural infrastructure; and providing modern urban public transportation.

To me, as a matter of priority, early outcomes must be measured against the goal of zero tolerance of corruption and crime, and building a modern education system. To retain talent and to attract more, you need to transform the fight against corruption and crime in order to create liveable cities to act as “talent magnets” which are open, tolerant, safe and liberal with attractive living lifestyles.

A lesson from history
European renaissance started first in Italy in the 15th century. It rapidly spread to western and central Europe. Outcomes were centred on (a) absorption of knowledge (mathematics) from India and Arabia; (b) notion of good living; and (c) rapid transmission of ideas through the advent of printing. But undesirable social conditions (poverty, strife and corruption) deteriorated in the midst of a golden age of plenty. What's happening in East Asia mirrors the renaissance swift absorption of knowledge from the United States and Europe, focus of living well now, and widespread dissemination of ideas emanating from information and communications technology and the computer. The lesson is clear: transformational changes must be accompanied by greater social cohesion to avoid problems from the worsening of social maladies.

Important how the public feels'
The Prime Minister declared that success of the ambitious blueprint hinges on its effective implementation: “Execution needs to be flawless.” As I see it, discernable progress in four areas of priority concern to the rakyat and investors needs to come early enough to build confidence. They are corruption, crime, education and private enterprise.

It is not enough to show that in the first nine months of 2010, crime fell by 16% (but still have 132,355 unresolved reported cases) and street crimes fell 38% (18,299 unresolved reported cases) or that 648 people were arrested for corruption.

The public and investors (with ears on the ground) have to “feel” any improvement. Raw and biased statistics cannot tell the real story, and don't impress. At this time, it would appear the rakyat and investors don't “feel” any material improvement in the crime and corruption situation. That matters. But they don't rush to judgement. What they want to “feel” is for today to be better than yesterday, and tomorrow to be better than today; and come tomorrow, their expectations are fulfilled.

Incidents from personal experience reinforce this. Damansara Heights (DH) is rated as a top spot to work and live in greater KL. I stay there and my office is in nearby busy Plaza Damansara. Last week my car was parked three doors away from my office, and within 10 minutes (no joke) the car was gone stolen (sophisticated anti-theft gadgets didn't help).

Although a police pondok is nearby, I still had to go to report at a police station far away and took altogether three hours just to get a police statement taken. Many more steps still have to be made before I can file an insurance claim. That's another story. Because my car was a popular brand, we were told that four such cars were stolen in DH in recent days.

Not so long ago, my associated office in DH was broken into and computers were stolen. When friends and neighbours learnt of my predicament, I had an earful of equally unfortunate incidents nearby, including muggings, holdups and handbag snatching. The point is simple: crime remains a problem of serious concern, even in the most liveable area in KL. People and investors just don't “feel” safe whatever the data may show.

Human capital and innovation
Key to NEM's success is ready availability of quality human resources. At its foundation is the education system and how it can be made to deliver. So far, none of the SRIs, NKEAs and NKRAs points to confidence that this will be done comprehensively any time soon.

Time is of the essence. The competition for talent is getting more intense worldwide. Bear in mind it takes at least a generation to finish one cycle of “production”.

On math, reading and science tests given to 15-year-olds in 65 countries in 2009, Shanghai teenagers topped all three worldwide. Near the top were: Singapore, Taipei, Finland, South Korea and Japan. Malaysia was not on the radar screen. The United States was, once again, in the middle of the pack in science and reading, but below average in math.

The Organisation for Economic Cooperation and Development (which runs these tests) attributed Shanghai's success to being a “leader in reform”, citing the city's near universal education system, its competitiveness in admissions, high level of student engagement, modern assessment system, ambitious curriculum, and a programme to assist weak schools. Until now, China has not even surfaced as a threat!

Human capital lies at the core of innovation and the taking of risks. Raising productivity requires a labour force of high calibre committed, motivated and skilled enough to drive transformational change based on excellence over the long term. Only private initiative can deliver this. Lest we forget, there is a big difference between incremental improvements and transformational change.

French President Nicolas Sarkozy says it best: Invention of the light bulb did not come about from incremental improvements to the candle. Make no mistake, transformational changes necessarily involve the taking of risks.

Tom Watson (founder of IBM) once said: If you want to succeed, raise your error rate. As I see it, a government that takes no risk in promoting innovation is one that is likely to make the bigger error of not trying hard enough. Getting private initiative back as the engine of growth is hard but critical.
Bold steps need to be taken. Incremental changes like getting government-linked companies (GLCs) to sell down equity, etc. won't get us there. Private investors need to get their Schumpeterian “animal spirits” fired up enough to squeeze out their entrepreneurial juices.

To be serious, the Government needs to get out of the business of doing business. GLCs and other federal and state enterprises are unfair competition. They only work to hold back the prompt re-emergence of real private initiative.

I should end with a quotation from my favourite poet, E.E. Cummings:

America makes prodigious mistakes,

America has colossal faults, but one thing cannot be denied:

America is always on the move.

She may be going to hell, of course, but at least she isn't standing still.

This is no time to stand still in undertaking bold transformational change. In the end, that's what statesmanship is all about.

Former banker Tan Sri Dr Lin See-Yan is a Harvard-educated economist and a British Chartered Scientist who now spends time writing, teaching and promoting the public interest.

AFP: Struggle to stem ‘brain drain’ as talent departs

Struggle to stem ‘brain drain’ as talent departs

Malaysiakini
Dec 30, 10

(AFP) When computer engineer Wan Jon Yew left Malaysia in 2005 for a job in Singapore, all he wanted was to work in the city state for a few years before going home. Now, he says, he will never return.

With a family, a home and a car, he now plans to settle in Singapore for good – just one of the many Malaysians stampeding abroad every year in a worrying ‘brain drain’ the government is trying to reverse.

“I wouldn’t consider going back to Malaysia, I won’t look back. If I were ever going to leave Singapore, I would migrate to Australia,” said the 28-year-old, who now has permanent resident status.

“It’s not about the money. I could have a better quality of life in Malaysia with my pay. I could have a semi-detached bungalow and have a maid there, but I would rather live in a government flat in Singapore.”

Wan, who is ethnically Chinese, is one of some 700,000 Malaysians – most of them highly educated – who are currently working abroad in an exodus that Prime Minister Najib Razak’s government is struggling to reverse.

The ‘brain drain’ has a number of causes. Some have been lured by higher salaries, but others blame political and social gripes including preferential policies for Muslim Malays, who form the majority.

Many feel constrained by life in a country where the ruling coalition has been in power for half a century, and where progress on freedom of expression, the right to assembly and tackling corruption have been slow.

A decades-old affirmative action policy, which hands Malays and the indigenous groups privileges in housing, education and business, has been criticised as uncompetitive and improperly benefiting the elite.

As a consequence, many of those who have left are members of Malaysia’s ethnic Chinese and Indian minorities, who make up some 25 percent and 10 percent of the population respectively.

Najib in December launched a ‘Talent Corporation’ with incentives to woo back these highly skilled workers, as well as foreign professionals, to live and work in his multi-ethnic country.

Malaysia, Southeast Asia’s third-largest economy with a population of 28 million, has ambitions to transform itself into a developed nation by 2020, but a lack of human capital is a barrier to reaching that goal.

155-fold increase over 45 years
World Bank data cited by the Malaysian press shows that while globally the number of migrants rose 2.4 times between 1960 and 2005, Malaysia’s diaspora registered a staggering 155-fold increase over the 45-year period.

“I don’t want my children to go through the unfair treatment,” said Wan, who believes Singapore offers “fair competition”.

“I’m not proud of being a Malaysian because I think the government doesn’t treat me as a Malaysian.

“I would rather be a PR (permanent resident), a second-class citizen in a foreign country, than to be a citizen in my own country.”

Wan said his wife, an IT analyst, renounced her citizenship in July this year, joining a queue of about 30 Malaysians lining up to do so on that day alone at the Malaysian embassy in Singapore.

Commentators are sceptical over whether the government’s latest effort to reverse the ‘brain drain’ will be successful, warning it will be tough to persuade those in self-exile.

“Money does have a significant role but the most important factor, I think, is opportunity. Malaysia is too politicised and opportunities are not evenly available to everyone,” political analyst Wan Saiful Wan Jan (right) told AFP.

In one example, he said, academicians are reluctant to work in local universities as they must sign a ‘loyalty pledge’ barring them from, among other things, criticising government policies.

“In such an environment, obviously those with talents will find opportunity elsewhere,” said the chief executive of think-tank the Institute for Democracy and Economic Affairs (Ideas).

Wan Saiful, who himself returned to Malaysia last year after living in Britain for 17 years, said the newly launched Talent Corporation will be “another expensive failure” if it does not tackle these structural problems.

“When I apply for a job, buy a house, register my children for school etcetera, why does it matter what my race or religion is? This should stop,” said the analyst, himself a Malay.

‘Brain gain’ effort
Ethnic Chinese and Indian professionals who have left the country commonly say they felt a sense of marginalisation in Malaysia.

“When I went back to Malaysia, it was a culture shock in terms of politically how they promote the rights of the Malays over everyone else,” said Chee Yeoh, a stock analyst who migrated to Australia three years ago.

Yeoh was educated overseas from the age of 10 and returned in 1998 to take up a position with a bank, but felt like leaving again “almost immediately”.

“I just didn’t feel at home in Malaysia. I can’t speak the Malay language – essentially I felt like an outsider even more,” said the 35-year-old analyst, who took a pay cut to move to Australia.

Najib has admitted the talent issues are “broad and complex”, and will not set a target on how many Malaysians he hopes to lure back under the new programme.

The initiatives include a ‘resident pass’ which will give foreign skilled workers, and Malaysians who have given up their citizenship, the long-term right to live and work in the country.

But Fong Chan Onn (left), former human resources minister who was instrumental in previous ‘brain gain’ efforts, said the government must tackle the issue holistically.

“The government needs to rectify this sense of marginalisation. We also have to improve the mechanism so it can be more effective to ask these talents to come back,” he said.

“We have a long way to go. It is better late than never.”

Malaysiakini: Our lost decade.... by Neil Khor

Our lost decade

Neil Khor
Dec 21, 2010
4:29pm

COMMENT The end of 2010 brings to a close our first decade in the new millennium. It might be profitable to reflect on the last 12 months and see what we have achieved.

More importantly, what were the opportunities that we missed? The focus is in the realm of politics, the economy, environment, culture and society.

Politics remain at the top of everyone's mind. Politicians, almost all opinion polls show, are still distrusted. There has been little attempt to forge a middle path.

In 2009, after the now legendary routing of the BN and the resignation of Abdullah Ahmad Badawi as premier, all types of provocations were thrown at the Malaysian public. We have been very fortunate as Malaysians ignored ethnic and religious baiting.

In 2010, the voices of discord have become so shrill that with each passing article, the sales of newspapers plummet to new depths. In cyber-space, opinions of all hues continue to pervade with social networking tools like Facebook and Twitter the main instruments of alternative political messages.

Whilst government supporters are now better organised, the battle for hearts and minds continue to favour contrarians. Will this translate into votes? Nobody knows and nobody wants to take chances.

The monopoly on information by traditional media is gone but it remains to be seen how effective the alternative media is in the semi-rural and rural areas. In short, polarisation continues to intensify in the political arena.

The missed opportunities in the political arena is that we do not have leaders who dare to be different; who can bridge the great divide and provide leadership on a national-scale.

Najib Abdul Razak is trying very hard and to his credit is gaining ground in his personal likeability index but this does not necessarily mean votes for the ruling coalition. Anwar Ibrahim although charismatic is now so wounded that it would be surprising if he can reprise his role as a unifying figure.

There is little indication of credible second and third liners. In short, we are politically screwed. With no middle ground there can be no possibility of proper parliamentary debate; instead there is increasing pettiness and obsession with self-preservation.

Nation of acronyms

On the economic front, we continue to bleed capital and talent. We are now a nation of acronyms. There are so many acronyms representing diverse development strategies that this writer will be very surprised if the average Malaysian understands what these policies are and why we need them.

The government is trying very hard to be everything to everyone. The New Economic Model will be race-blind when it comes to eradicating poverty, especially of the bottom 40 percent yet the NEP is still relevant.

The reality is one the government is unable to articulate: our institutions including the civil service has decayed for so long that national policies need to be validated by consultants.

The government is concerned enough about Malaysia's future to acknowledge that we are in dire need of new economic strategies.

Whilst we are all agreed that a more equitable Malaysia is a common goal, there does not appear to be any consensus on how to achieve it. The BN's strategy is to grow the pie bigger but we have had that for 53 years and we are still a rather unequal society.

The opposition wants to crown the rakyat,advocating a rakyat-based economic strategy. 

Like governmental acronyms, the opposition has not shown us the cards in their hands. If the BN's policies are not working, what is the alternative?

We now have a group of people who call themselves the 'Third Force', some even aspiring to be the Liberal Democrats of Malaysia. 

Fine, but please someone tell us what should be our economic strategy to attract talent and capital to drive economic growth that is sustainable and as equitable as possible?

Un-sexy issues

Malaysians are also growing very uneasy about the environment. Floods in Kedah are a clear indication that global warming is having very real effects on the ground. We have not spent nearly enough attention to prepare for the full-effects associated with climate change.

So much attention is focused on politics that a very important conference on renewable energy was hardly registered. In the meantime, we have literally mountains of waste to manage. 

The government is suggesting nuclear power as an option for our future energy needs and a lot of attention is given to it.

But what we've not focused upon is the continued degradation of our natural resources owing to commercial agriculture resulting in the loss of 1m of top-soil over the last century or that we are now building dams because we want to get at the valuable timber.

Culture and society are also subjects that are not 'sexy' and only come up if it is associated with a political statement. Interlinked with these two subjects is education.

Now, what sort of country needs to revise its history syallabus every time there is a political debate?

What kind of society kills women and children; where the crime rate is so high that even the homes of retired police officers are not safe?

As we mull over politics, do we even ask ourselves what is the point of it all? These questions, which cannot be quantified, are irrelevant. It is as though we have lost touch with our own gut-feeling; our internal moral compass.

In the next week there might still be some interesting political fireworks. Whilst we obsess about who will win the next general election, the world continues to march. Some will say the human race is marching towards its own extinction whilst others feel that we are being left behind by the van of progress.

Whatever your view, it cannot be good if we are unable to think nationally about education, healthcare, the economy, culture and society without being coloured by politics.

Some see Malaysia's problems as indications that we are the sick man of Southeast Asia. It is more correct to say that Malaysia is a nation in transition. It is our duty as citizens to make sure that we transition to become a better nation.

Happy New Year.

NEIL KHOR completed his PhD at Cambridge University and now writes occasionally on matters that he thinks requires better historical treatment. He is quietly optimistic about Malaysia's future.

Deepavali — and darkness precedes light — Dr David KL Quek

Deepavali — and darkness precedes light — Dr David KL Quek

The Malaysian Insider, November 06, 2010

 

NOV 6 — The wondrous thing about Malaysia is that we have so many celebrated festivals — both ethnic and religious — that provide for so much festive cheer, even if so many of these appear to be more and more socially-contrived and state-sanctioned goodwill and camaraderie.

Some of us lament the fact that many such events have lost their spontaneity and genuine warmth that used to showcase our “Malaysian”ness. Many subscribe to these engineered social events out of sheer political affiliation or the availability of free lunches. But they do give that picturesque semblance of the Malaysian brand, even if they appear cheesy or superficial.

Nevertheless, public holidays also provide for some of us, sporadic commentators, the much-needed time to time-out and perhaps to reminisce and reflect.

Deepavali or Diwali, as the Festival of Lights for Hindus, is one of those special celebrations that should offer us that opportune moment to contemplate where we are once again in the post-election aftermath of March 2008, for the much-anticipated political awakening, and our tottering attempts at social and political change for the better.

Prior to this, the fearless Hindraf movement burst upon the Malaysian scene to spark the improbable impudence of people power, perhaps igniting for the very first time in a long while, the demand for empowerment of a long-suffering downtrodden people. Light from darkness, which embolden perhaps many other citizens to awaken from their long slumber of sociopolitical apathy.

More than five decades of nationhood should provide us with the experience and the audacity to establish and behave as a nation, which truly “can do”, mature in every aspect of human development and social egalitarianism. We should already have a unifying national vision, which empowers and incorporates every citizen to partake of our immense wealth, our consecutive good fortunes and our shared aspirations. Much remains to be done. It also means that we have to work more cohesively to garner greater momentum as a whole, to hopefully realise our collective goal towards becoming a fully developed nation by 2020.

Yet, truth be told, we are beset with greater sociopolitical and religious divisiveness than ever before. The more ethnocentric and religious-minded nowadays shun inter-ethnic contacts for religious or other reasons. Neighbourly cross visitations and social interactions are also becoming fewer and shallower, because many worry about the political or peer correctness of their actions. Worse, many are contemptuous of and disdain the other, fanned by parochial misinformation!

Thus, there is that heightened sense of religiosity and/or ethnic superciliousness that breeds growing avoidance of others different from the self or group. There is that comfort zone indulgence which generates even greater insularity, narrow-mindedness, and plain tribalistic intolerance.

Most if not all are wary of sharing and eating “tainted” non-halal food from unclean crockery and utensils. There is the fear that cross visits might also be construed as pandering to politically-incorrect ideas, as condoning idolatry or worshipping of different gods and deities, fear of labels of heresy (kafir-mengkafir), or insult to their religiousness, etc.

Let’s be brutally honest about this: our tolerance towards one another has been wearing very thin, of late…

Still, our open houses are unique and should serve as auspicious opportunities to foster closer interethnic and inter-religious understanding and tolerance. Well, at least they are supposed to do so, for those who dare or who are brave and liberal enough to surpass their fears or prejudices of the ethno-religious unknown or uncertainty.

How is it that many years ago such tensions never seem to deter our natural inclinations, our sincere if inattentive cohesiveness, despite the broken “pasar” Malay, the strongly accentuated stereotypes of ethnic peculiarities, which continue to evoke laughter and jest in a “cosy” if crude and sometimes irreverent manner? What has happened?

Why have we become so different and divided as we move through these 50-odd years of supposed maturity into a nearly-developed nation, to have become more and more separate and isolated within our own communities, so long a part of our Malaysian history and brand?

As we gather and celebrate our diversity and extraordinary relationships, we must learn to understand and delve deeper into our special circumstances, which make us Malaysians unique in the happenstance of history. We must learn to celebrate our nurtured schema of multiculturalism, so much touted in this uncertain world of disparate and widening chasms. We must strive to eschew the so-called “clash of civilisations”.

Indeed, isolated if intermittent incidents of ethnic and religious outbursts in Malaysia provide a microcosm of the possible civilisational tensions which exist in the world today. It is arguable if Malaysia and our authorities have handled our discords well, or evenhandedly at that. But, there is no template the world over, of what is the right thing to do; we just have to do better! We must find better alternative approaches than mere confrontation and headstrong immovable tit for tats.

Our leadership must robustly and clearly guide the moral direction of where we want our nation and our Malaysia to go, without wishy-washy flip-flopping pronouncements, which only pander to opportunistic bigots and partisan groups! But this is not to say that we should usher in a new era of authoritarian dictates; this should never be the case. Nor should there be intimidating and selective sanctions by the arguable applications of the rule of law!

Simmering tensions and subterranean anger continue to plaque our cohesiveness, our unity — which increasingly appears fragile and sometimes ostensibly shattered by shameful acts of irrational bigotry and repeated hurtful rhetoric by aggressive chauvinistic politicians.

Slogans of progressive and moderate civilisational Islam or Islam Hadhari, notwithstanding, most non-Malay and non-Muslim Malaysians are increasingly feeling isolated and alienated. Malaysian Indians and Chinese, with their unflinching advocacy towards cultural and linguistic “identity” and unrelenting demands for education in their mother tongues, continue to rankle detractors who consider such a “separate” system as divisive towards nation building.

But, unfortunately, the ethnocentric fears of educational standards and opportunities, of perceived biased religious or racial overtones (at the expense of the minority religions and cultures) are not readily understood by the authorities, which are seen to have increasingly dispensed with wider multiethnic input or inclusiveness.

Recent exposures of BTN propagandist lecturers and racist outbursts by some school principals underscore the doctrine of inherent intolerance among even the most senior of civil servants. It is not unreasonable to expect that many more similar incidents might not have been exposed. Schools and the civil service are, therefore, becoming more and more mono-ethnic and mono-religious in character.

In fact, our entire civil service is now so mono-ethnic that this doctrine of separateness has become so entrenched that we have become “them and us”! There is that expected “ketuanan” relationship of top-down approach (not necessarily of genuine respect and regard), but also a reciprocal, if insincere and begrudging obeisance.

This only begets even more divergent undercurrents of separateness, anger, envy, feeling of unfairness, snide contempt and possible abhorrence. Outwardly, there is that superficial acceptance, deference and unspoken tension. This probably extends to their relationship with other authorities such as the police, the military and other agencies. Thus, non-Malays are more and more driven into a “minority cluster”, which is merely tolerated but not really accepted.

One surprising pronouncement of PM Datuk Seri Najib Razak during the Umno general assembly only underscores the separateness of the Chinese and the Indians in Malaysia, when his concept of who is a Malay now encompasses literally everyone else who is Bumiputera, and anyone who adopts Islam as a religion and practises customs and language of the Malays, or whoever is Muslim, notwithstanding their recent origins from within or outside the actual boundaries of the nation…

Unfortunately, such a declaration only serves to marginalise the non-Muslim non-Malay Malaysians all the more. We may no longer be called “pendatangs” but we are also not among the “favoured” citizens as well. Such is the interpretation of the so-called “social contract”, based on but not explicitly stated in Article 153 of the Federal Constitution. Worse we are now urged not to question or raise these concerns, that we must refrain from discussing this “social contract” so that inter-communal harmony can be preserved in the nation!

This concept of differential citizen’s rights runs counter to most nations around the world where full citizenship rights — apart from “jus soli” (citizenship acquired by birth within the territory of the state, regardless of parental citizenship) — are based on one’s economic or special contribution, and where one’s preferred choice of nationality is based on the individual’s special qualities or contributory worth, and takes precedence over any religious or ethnic differences. Once we become citizens or are born one, then shouldn’t we all be equal before the law?

How much one is willing to sacrifice to the greater good of any form of discriminatory citizenship would sorely test the resolve of a modern global citizen, no matter the patriotism that one wishes to inculcate or even indoctrinate!

Such would be the dilemma of the Malaysian-born non-Malay in a globalised world, where one’s professional or technical expertise, natural talent or financial worth would dictate preference and attraction to most countries around the globe. How can we now talk about talent retention and attraction to boost Malaysian intellectual property strength and power, when the core principles of fairness and merit are not sacrosanct?

How then can one find meaning and purpose in our individual and collective resolve to belong, to be an integral part of that Malaysian dream, especially if one is a born Malaysian but of “wrong” ethnic origin? Should this really matter at all?

“Malaysian citizenship, at its very core, was not based on equality but it was made to fit the reality (of the country’s) long-term goals and interests,” says Najib. So does this mean that one’s interpretation of “history” cannot be allowed to change with the times?

How then can we simply say that such is the inflexible and immutable quirk of fate and history that we are but unequal citizens, for all time? Yet, we are exhorted to be selfless responsible citizens who would subsume ourselves for the greater good…

But like Lim Teck Ghee and others (malaysiakini: Malaysians ready to discuss ‘social contract’), I believe that “the Malaysian public has reached a level of political maturity that we can have a rational and public debate on the way forward in terms of any inter-communal accord or understanding arrived at, and on what needs to be honoured and respected.”

Just gagging such discussions would otherwise cause the riptides of feelings of injustice and discrimination to slowly but surely corrode and destroy the so-called accord of working together as a united Malaysian team. Silencing rational debate would undermine the expected positive contribution that we hope for, from all the collective talent and entrepreneurial prowess of our citizens!

The highly competitive globalised economic climate would demand that every single citizen pull his/her own weight to productively contribute towards nation building if we wish to prosper, as we work towards 2020 and beyond! There will be no free-lunchers, no stowaways, no tolerance or margins for errors or wastage…

Let’s make every Malaysian count and be counted, and not shortchange or undermine his/her loyalty to become a full-fledged, fully committed citizen.

From the darkness of introverted ethnic communalism, let there be light! Let the festive lights of Deepavali enlighten our cobwebbed mindsets and help illuminate a new bold path for all Malaysians!

CORRUPTION: The Pass Mark Eludes Malaysia... by Tunku Abdul Aziz

CORRUPTION: The Pass Mark Eludes Malaysia

by Tunku Abdul Aziz

Judged internationally, by almost every performance indicator known to man, Malaysia is a duffer, and that is putting it charitably. Our report card is drowning in a sea of red ink. The 2010 Corruption Perceptions Index just released shows Malaysia scoring 4.4 points at number 56 out of 178 countries surveyed.

Many have questioned the methodology used and have gone so far as to suggest developing our own index. But let me just say this. Whatever we may think, the Transparency International Corruption Perceptions Index enjoys a reputation second to none as the world’s most authoritative index of its kind.

A similar sentiment has been expressed about the world’s top universities index. Shoot the bearer of bad news and retreat to hide under our tempurung and croak our lungs out for the entire world to hear about our version of Malaysia’s achievements. We have become a nation of bad losers.

When Datuk Anwar Fazal, Raja Aziz Addruse, Datuk Param Cumaraswamy and other like minded men and women of the highest integrity met in the Royal Commonwealth Society one night many years ago to discuss forming the Malaysian Chapter of Transparency International Malaysia, they had seen enough, and had become greatly concerned at the speed with which corruption in national life had destroyed the moral fabric and consumed the very soul of our people. It was not the easiest of undertakings to operate an anti-corruption non-governmental organisation during Mahathir’s corrupt and repressive regime.

The Registrar of Societies in this case was helpful, and much to our delight, approved our application. TI owes its existence to Tan Sri Hassan Marican, then President of PETRONAS a highly principled servant of this country. He invited me to lunch in my capacity as President of TI and said, not five minutes into the meal, that he would like to support our work, and how much would I need? I responded by saying I was not interested in a one off grant, but long term support. I asked for very little, not wanting to be greedy. He agreed. I understand the PETRONAS support continues today, with no strings attached.

In the years since the TICPI made its appearance in 1995, two years after Transparency International was founded, Malaysia has very rarely achieved the minimum pass mark of 5 points. We used to be ahead of South Korea regularly, and in Asia were for years only behind Singapore, Hong Kong, Japan and Taiwan. What all this shows is that we have regressed to a point that corruption in our country is no longer just a fact of life, but it has graduated to become a way of life.

When we look closely at the countries that are perceived to be among the least corrupt, we find they are invariably well governed and that there is a correlation between good governance and competitiveness. These countries realise only too well that corruption if unchecked will distort and destroy their moral values and value systems and, sooner rather than later, their economies.

The symptoms of moral decay is everywhere in this country. It never ceases to amaze me at the naivety of our government leaders that they think that mere rhetorical expressions of good intentions to fight corruption could camouflage the unbridled systemic subversion of the country’s mechanisms of checks and balances and other institutions of government as part of our constitutional arrangements to protect the rights of our citizens.

Mahathir’s had a cynical view of his stewardship, a concept totally alien to him. He set about destroying, like a man possessed, what he saw as constitutional or legal impediments to his personal and political ambitions. His legacy to Malaysia is best described as a lasting and deeply entrenched culture of corruption that this country will be saddled with for all time unless we, the citizens, take matters into our own hands and vote the corrupt government of the day out of office. Do it before it becomes a case of too little, too late.

In the meantime, my advice to Najib is to stop playing the silly games much loved by Abdullah Badawi, the keeper turned poacher. He put up a slew of anti-corruption showpieces such as the National Institute of Integrity, the Royal Commission inquiring into the Royal Malaysia Police, and new anti-corruption laws to support the work of the Malaysian Anti-Corruption Commission, all nothing more than a sleight of hand that has fooled no one, with predictable results. Badawi’s exercise was both dishonest and costly, and as the latest TICPI shows, corruption has the last laugh.

In a speech I made in 2001 at the Asian Development Bank-organised conference in Phnom Penh, I reminded my audience that “Even before we contemplate any action against corruption, it is important for us to recognise the special and complex circumstances that give rise to it.

Studies show that a common cause of corruption is a lack of strong and unsullied government institutions, such as the judiciary, the legislature, the office of the auditor-general, the police, the office of the attorney general, the media, civil society organisations and the private sector.”

In Malaysia, sadly, Mahathir has succeeded brilliantly in doing his foul deed. None of these important institutions can any longer even justify their existence and they have become part of the problem of corruption. “The main purpose of developing strong institutions is to prevent corruption from occurring in the first place rather than relying on penalties after the event” according to Jeremy Pope in his TI Source Book 2000.

The Executive can change the hitherto negative international perceptions and at the same time exercise greater legitimacy to govern by making it mandatory for all holding elected public office, including the prime minister, to declare their assets and those of their wives and immediate families to an all party parliamentary commission.

Other areas of concern relate to issues of integrity of the various key national institutions. Public procurement as practised in our country breeds grand corruption and is one of the reasons why we score badly in overall terms.

The Official Secrets Act protects the corrupt and must be replaced with a Freedom of Information Act. It would be extremely important to bring new, intelligent and untainted blood into the MACC which at the moment seems to have run out of steam before the whistle to commence play is blown. It must report to an all party parliamentary commission.

While we want those who commit corruption to be suitable punished, this must be done within the scope of the existing judicial practice. The idea as suggested by TI Malaysia President that for the MACC to operate effectively, it must be given the power to prosecute is dangerous as it shows a lack of understanding of what constitutes justice. What is implied in this preposterous idea is that we abandon all principles of fairness and fair play so that the MACC could trample on our justice system with impunity. Enough is enough.

Early next month I will be speaking in Sydney, Australia at the annual conference of the Australian Corporate Lawyers Association on, no prize for guessing, my favourite subject, Overcoming Corruption: A Regional Challenge. I will have a field day calling a spade a spade. I hope I will not be accused of disloyalty to my country, but if telling the truth is treachery, so be it.

mysinchew.com: Anwar waves his magic and thrills European audiences — by Tunku Abdul Aziz

Anwar waves his magic and thrills European audiences — Tunku Abdul Aziz

mysinchew.com, October 04, 2010

OCT 4 — I have had to come all the way to Brussels and Berlin to discover a side of Anwar Ibrahim that I was wrong about.

Reading the Barisan Nasional-owned newspapers that consistently portrayed him as a “traitor to Malaysia” who exaggerated the situation obtaining in the country given half a chance, I have, I must admit, tended to view him as a self-serving political demagogue who could not care less about the fate of his country as long as he achieved his ambition of becoming prime minister.

Anwar spoke last Monday evening (September 28, 2010) on “Liberal Values in the Muslim World — Why Islam and Democracy are Destined to Coincide” to a packed hall of some of Europe’s powerful decision-makers. These were men and women with wide international experience and could not be easily hoodwinked even if he had tried.

It was vintage Anwar, perfect smooth-as-silk delivery of a complex, serious subject to a critical audience. He knew his stuff. His was more than a speech; it was an intellectual journey mapped out by someone who knew the area traversed like the back of his hand.

There he stood, under the spotlight, his charming and quietly confident self as always, speaking without a note for a full hour. Earlier in the day, when he said to me he had to go back to his hotel room to give his speech the once over, I told him half in jest that he could make his speech standing on his head. He did just that and more.

He successfully won the audience over with his argument, supported by historical antecedents and more recent examples that completely demolished the conventional wisdom in non-Muslim circles that Islam and democracy were somehow incompatible bedfellows. He challenge the unfounded belief that it was against the order of nature for Islam to embrace democracy as seriously flawed because of the underlying assumption that Muslims, unlike others, were not born free to exercise their democratic rights.

As I sat listening to the prime minister Malaysia never had, thanks to Mahathir the Maverick, and who
might yet take the country by storm, Anwar, I mean, not Mahathir, I could not help thinking how utterly sad and absurd for Najib, whose articulation of his 1 Malaysia slogan invariably finishes in a cul-de-sac, offering his services to Obama to help bring about greater understanding of Islam, the religion of peace, among the majority American non-Muslims. My dear fellow, charity begins at home.

The only Malaysian politician, who can, without making a fool of himself, stride the world stage with the right combination of strong intellectual credentials and honesty, is not to be found within the serried ranks of the BN, but in the person of Anwar Ibrahim, Malaysia’s iconic liberal democrat.

As I saw here in Brussels, he had the European parliamentary leadership, figuratively speaking, eating out of his hands. Many have already put the champagne on ice; they clearly see this victim of a rotten political system as the next man to lead the country.

For all our sakes, I hope they are right. Malaysia needs a thorough overhaul and Najib whom we need like we do a great big hole in our head is unlikely to understand the dynamics of change for the great leap forward. Even if he understands the urgent necessity for change, would he be allowed to by the reactionary forces with the party ever so gingerly as the prospect of a palace coup remains a distinct possibility? He is not only busy watching oversized baggage, but also his back with the sort of loyal friends he has had foisted on him. There simply isn’t much time for anything else while the ship of state springs more leaks by the day.

I was asked by a senior European Parliament bureaucrat over coffee what the Pakatan Rakyat coalition’s priorities would be on taking over the federal government? In brief, I said revamp institutions of state that have been virtually destroyed and have, in many cases, been rendered dysfunctional, overhaul policies, systems and procedures that have tended to divide rather than unite Malaysians, pay special attention to economic policies centred on orderly growth and sustainable development, and generally to put things right and undo the excesses and abuses of that began under Mahathir so that democratic principles and practices may have a real chance of taking root. A tall order but with fairness, and integrity grounded in the rule of law, God willing, we will get there. — mysinchew.com

malaysiakini: Conquer fear? Yes, we can... by Josh Hong

Conquer fear? Yes, we can

Josh Hong
malaysiakini, Oct 1, 10
1:27pm

In rolling out the Economic Transformation Programme (ETP), encompassing a great variety of projects totaling US$44 billion, Prime Minister Najib Abdul Razak is pinning his hopes on securing an electoral victory over the opposition with impressive economic performance.

But would any economy in the world achieve transformation without deep-rooted reform? I am afraid not.

In fact, the experiences of the developed nations strongly indicate several key factors in sustainable economic growth: openness to the world economy, extensive freedom of private business, stable and efficient regulations (including well-defined property and intellectual property rights), considerable infrastructure investments, a competent, professional and honest public administration, strong commitment in human capital, as well as a vibrant civil society.

As Najib celebrates the 18th month of his government this weekend, the public is yet to hear about root-and-branch reforms in the judiciary, police, bureaucracy, press and media and, of course, the political sector.

Instead of feeding the people with dazzling but unrealistic figures and statistics, the government will do well to spell out concrete measures - if any - to root out corruption, improve public integrity and enhance transparency. Any attempt at China's Great Leap Forward will likely end in bitter disappointment at best and catastrophic failure at worst.

Recent developments show that the government may on one hand be trying doubly hard to prove that it does have in mind a gigantic economic pie to keep everyone satisfied, it is also seeking to tighten up control over the public on the other.

Of late, there has been a series of blatant assaults on voices and views that do not go down well with the powers-that-be, the latest casualties being Zunar, the popular cartoonist who was briefly detained last week, and Kim Quek, whose title The March To Putrajaya is now officially banned. The government's weird and desperate acts have got Zunar and many wondering if one, under Najib's 1Malaysia, now needs a licence even to laugh.

Umno's politicking is so intense and its attacks so profane that they have prompted one Hata Wahari to brave the potential reprisal by urging both the government and the top management of Utusan Malaysia to stop exploiting the Malay daily as a political tool.

Nearly five decades to the year when the once progressive Malay nationalist newspaper was forcibly taken over by Umno amid much public outcry and protest, a conscientious voice that resembles that of the fearless Said Zahari is finally heard, however feeble it may sound.

Writing already on the wall

Like it or not, the end of the Barisan Nasional era is nigh. Even if it does not happen at the next general election, the writing is already on the wall. The strange emergence of Perkasa cannot be more ominous. In failing to distance itself from the ultra-Malay group, Umno is alienating non-Malays, with the MCA, MIC and Gerakan being among those hit by collateral damage.

Even moderate and fair-minded Malays will be alarmed by the incivility pervasive among Perkasa members, whose abusive language and vulgarity have outdone Namewee's poor taste. Both Perkasa and Namewee can now go back conceited, safe in the knowledge that they have strengthened their respective support bases.

All this is part and parcel of Umno's cunning plan to strike great fears in the public, for no authoritarian government will take defeat lying down, especially when so much vested interest is at stake.

Knowing that all the dodgy deals and mega scandals have widened the trust deficit between the people and itself, the BN government has no option but to do its utmost to ensure minimal punishment at the ballot box, hence the paradoxical combination of economic hopes and political fears.

Whether the oft-used tactic will work is dependent on us. Malaysians must remember our dreams will be blocked or even shattered if we allow our fear to grow bigger than our faith in creating a peaceful and trustful society.

Fear makes strangers of people who would otherwise be friends. For years, Malaysians of all races have been frightened into thinking the other party would never understand us, so we choose not to talk directly to avoid unpleasantness. But are Malaysians really so immature in handling differences that we must constantly look to the government for guidance?

The Germans cannot have put it more succinctly: fear makes the wolf bigger than it is (Angst macht den Wolf größer, als er ist), so the onus is on us to reject BN's politics of intimidation and bullying. National life is nothing if it is based on fear, rather than genuine hopes and understandings.

It is either that we rise up and overcome the fear, or wait to be devoured by it. What do you think the authorities can do if thousands of people take to the streets to protest against the government's inertia in institutional reforms across the board? Put us all behind bars?


JOSH HONG studied politics at London Metropolitan University and the School of Oriental and African Studies, University of London. A keen watcher of domestic and international politics, he longs for a day when Malaysians will learn and master the art of self-mockery, and enjoy life to the full in spite of politicians.

malaysiakini: A nation of failed economic development plans... by AB Sulaiman

A nation of failed economic development plans

AB Sulaiman
Sep 20, 10
1:45pm

COMMENT The world can be a nasty place especially in terms of planning, where your best and well intentioned plans can produce the worst unintended results. The country's numerous development plans is a perfect example of this.

Since Independence we have always strived to be a country with strong social, economic and political credentials: a strong healthy and united people, public safety and security, great infrastructure, mature democracy, clean human rights record, good education system, governed under rule of law, and of course, a justice-minded judiciary.

To top them all off we are to enjoy a per capita income equal to the peoples in advanced economies. We wish to be an advanced country in our own right.

The current realities are anything but. The people are fragmented while some are migrating to friendlier lands, our infrastructure while adequate is wasteful, our democracy is an ugly disguise for authoritarianism, our education system produces non-thinking graduates, the rule of law has become the rule by law, and the judiciary is an international laughing stock.

The latest world indices would confirm this. There are many but I'd mention just two. First, the 2009 figures for FDI showing an 81 percent fall from US$7.32 billion to US$1.38 billion. At this paltry level we now have joined investment-unattractive countries like Myanmar, Cambodia, Laos and Timor–Leste.

Not only that, apparently the FDI into Thailand and Indonesia have overtaken that coming into Malaysia, once the darling of international investors.

Two, as for per capita income we are at about US$7,000 while the advanced countries we wish to join are at US$30,000 and above. We are less than a quarter of the way to our self-proclaimed goal.

On looking back, we started well in the arena of economic development, but somewhere along the line we faltered and very badly.

Faltered from the start

I reckon we faltered beginning 1970 when we introduced the New Economic Policy (NEP). This was when we began propounding and experimenting economic development plans beyond the parameters of sound economic principles.

Specifically we made plans and projections not in the interest of the country, but in the interest of a segment of the population, namely the Malays.

Now this might be an explosive statement to make so I have to make my stand clear.

The fact of the matter is that the factors of production in an economic set-up are land, labour, capital, entrepreneurship, and in an increasingly knowledge-based world economy, on the ability to access and utilise knowledge. I 'borrow' these factors as principles for economic development.

For an economy to expand therefore, all scarce resources must be optimally channelled for the development of these principles.

I'd reiterate: develop land, inject capital optimally for investment, encourage entrepreneurship, enhance the level of knowledge through smart education. Only then can the economy expand and achieve sustainability.

This last element of sustainability is important – the developing economy must reach a level when it can sustain or regenerate itself without anymore support from any planning agency.
Anything less than this and we can see an economy not going anywhere, and could in fact regress, like our current situation. Lim Kit Siang sums it well – the economy would be a 'work in regress'.

What has gone wrong with our string of development plans? In my view there are several, and I mention them here despite being aware that many commentators have mentioned them constantly. Perhaps there can be some wisdom in saying the same things again, hoping somewhere along the line the decision makers can begin to listen.

Several hundred billion USD wasted

First, after 1970 we seem to divert the elementary formula for economic development mentioned above, into some non-optimal channels resulting in massive wastage. Our planners channelled land development mainly to the Malays. We made development plans for sectarian, not for national interests.

In this way the Malays gain comparatively easy access to scarce capital they cannot fruitfully use because of their lack in entrepreneurial skill and spirit. Their lack in education and knowledge have rendered their productivity level below that of their non-Malay counterparts.

I am aware of course that this resource misallocation was for a special reason and thereby meant to be implemented only for twenty years. But when this time was up the authorities would merely forget this proviso.

As events turn out, such allocations have proven to be below optimum level; even wasteful of scarce resources. External observers have noted that the NEP wasted several hundred billion US dollars!

Favouring race over economics

When the leaders saw that the Malays could not cope and the non-Malays restive they use race and religion to both spur the Malay on and to push away any non-Malay disgruntlement. In other words the leaders dismissed the traditional economic factors of national asset creation in favour of Malay racism and cultural hegemony under the banner of Ketuanan Melayu; and of Islam.

I might be out of academics but I have never known racism and religion to substitute economic factors in any country's asset creation efforts. Surely the planners have not forgotten that this new formula was experimental in nature and to last only for twenty years.

In any case, here we see the early unintended results of the NEP. On the part of the Malays we see a community of people developing a false sense of confidence that they have progressed ahead on the platform of race and religion; whereas in actuality they have not.

On the part of the non-Malays they see the wastefulness of the country's allocation of scarce resources in the interest of racism and religion as the sure way towards non-sustainability and regression.

And yet the authorities would prevent the citizens to even debate the issue.

No post mortem conducted

Come 1990 and the NEP report card had shown the recklessness of this development programme. Malay achievements were nowhere in sight.

Would there be some form of post-mortem analysis to see the good and bad points? To see whether the country should progress ahead in the same race-and-religion principles?

There has been no such effort, not to my knowledge anyway. It has been more of the same: more racism, more religion. And here we see the continuation of a string of failed development programmes.

Dr Mahathir Mohamad (left) announced the Vision 2020 stating that the country would join advanced nations by this magical year. It was well-intended perhaps, but with the economic principles remaining unchanged, that is in favour not of the country but of the Malays, the country began its slide downwards.

When Abdullah Ahmad Badawi took the reins of power, many people had thought that he might just do the right thing to put the country back on the right track again. But he used religious motives (remember Islam Hadhari) to lead the people forward – there was no change there either.

Now we have Najib Razak leading the nation out of the dangerous zone of falling into the steep precipice of a failed state. He has his own plans of course, and its called 1Malaysia: people first, performance now. Will he make any headway?

I just say this to him for whatever it is worth. Go ahead with your development plans based on the proven factors of production as mentioned severally above.

But do not be distracted by sectarian interests, nor for religious considerations. Go for optimum scarce resource allocation and economic sustainability.

AB SULAIMAN is an observer of human traits and foibles, especially within the context of religion and culture. As a liberal, he marvels at the way orthodoxy fights to maintain its credibility in a devilishly fast-changing world. He hopes to provide some understanding to the issues at hand and wherever possible, suggest some solutions. He holds a Bachelor in Social Sciences (Leicester, UK) and a Diploma in Public Administration, Universiti Malaya.