Islamic Diplomacy and the Search for Human Security

May 20, 2013

The Keynote Address at the Peace and Security Forum 2013 at the Institute of Diplomacy and Foreign Relations, Ministry of Foreign Affairs, Kuala Lumpur on May 16,2013.

by  HRH Dr. Raja Nazrin Shah

I WARMLY commend the organisers of this conference for shining a spotlight upon one of the most pressing challenges confronting the Muslim world.

The violent conflicts that afflict some Muslim countries are discussed in many conferences. They feature in the global media every day. In fact, they feature in the global media virtually every hour of every day, and in my view rightly so, for almost every day Muslim lives are lost, Muslims’ limbs are maimed and Muslim land and property destroyed.

But few international forums — and far less the global media — look at the problems the Muslim world is encountering in a way that is more profound and comprehensive, as that of a paucity of human security.

Fewer still approach the subject of human security in the Muslim world from the standpoint of the role that Islam and diplomacy can play in promoting it. The theme of this conference is, therefore, both novel and welcome.

Before I proceed, I should like to take a moment to place the problem of human security, as I see it, in perspective. It is interesting to note that the concept of human security first came into international vogue as a result of the work of a Muslim economist, Dr Mahbub ul Haq. He conceived both the concepts of human development as well as human security that have been so central to the UNDP (United Nations Development Programme) approach to developmental issues since the 1990s.

Unlike the Human Development Index of the UNDP — which has now been widely accepted and adopted — an index of human security is still very early work-in-progress. Even an understanding of what human security means and what it encompasses is the subject of debate and discussion.

Until the dust settles on this subject, I should like to be guided essentially by the initial concept as outlined by the UNDP in 1994 and developed further in Version 2 of the Human Security Index.

I must stress, however, that the Human Security Index probably cannot yet be regarded as a sufficiently robust measure of the real state of human security among different countries. But it does give some general picture of the situation. Its importance at this stage lies more in its ability to depict the relative gravity of conditions in different countries based on the criteria employed.

In my view, briefly expressed, human security centres on the security of the human person and the community. This is unlike the conventional notions of national security which pivot around the security of the state.

Human security includes traditional national security concerns such as security from external aggression, security from external intervention, security from foreign occupation as well as security from internal strife; but it also embraces much more.

It includes the security of livelihood provided by steady jobs and meaningful employment; the security from disease that is provided by good and widely accessible health facilities; food security; protection from crime and domestic violence; freedom from political repression; the right to practice one’s religion freely; and the right to clean air, safe water and a sustainable and healthy environment.

Human development as postulated by the UNDP is thus closely correlated with human security. The former seeks to develop the human person; the latter to protect him or her from threats to that development.

Human security facilitates human development, while human development releases more resources to improve human security.

Human security tends to be better assured in peaceful countries that rank high in human development, but it can also lag behind.The United States, for instance, ranks No. 3 in the latest Human Development Index; yet its composite Human Security Index ranking is 147 out of 232 countries and dependencies.

The ranking reflects very poor scores in several areas, including very high incarceration rates and wide disparities in income and wealth.

Thus understood, human security, or human insecurity, knows no nationality. It knows no religion. And it knows no race or ethnicity.

Although the peoples of the developed nations of Europe and North America are less vulnerable, human insecurity also tends to recognise no geography.

Unemployment in the European Union, for instance, is expected to reach an average of 12.2 per cent this year. That is four times the unemployment rate of Malaysia. In Spain and Greece, every fourth person in the workforce is unlikely to have a job.

Human security, whether in the Muslim world or elsewhere, is something that is complex in the sense that it cannot be advanced by just the one tool of diplomacy.

Diplomacy, indeed, is perhaps not even the most important instrument. Much of the hard work must be done at home in each country, through sound and equitable political, economic and social policies.

The primary actor and driver may indeed be the state, but there are a host of other important domestic and external players that make an impact upon human security in every individual locale.

The mix of political, economic, social and security factors that affect human security differ markedly among countries and communities, Muslim as well as non-Muslim.

I will elaborate on some of these general points presently, but let me turn now to the quest for human security in the Muslim world.

As we know, Muslim communities are found virtually everywhere on the globe and amidst differing conditions of human security.

Like many non-Muslim majority countries, Muslim countries and Muslim-majority countries often fare worse in the Human Security Index than they do in the Human Development Index.

This reflects their relatively poorer performance in areas such as political freedoms, income distribution, access to information and personal security compared to indicators such as per capita GDP (Gross Domestic Product).

Whereas at least ten Muslim-majority countries make it to the top 70 in the Human Development Index ranking, none are in the top 70 in the Human Security Index ranking. Seven countries managed to be ranked between 80 and 100. As in the case of the Human Development Index, many Muslim countries are ranked in the bottom third of the Human Security Index table.

The picture that emerges shows that the comprehensive well-being of the people in a number of Muslim-majority countries leaves much to be desired.

Many millions of Muslims do enjoy high levels of material security as minorities in affluent Western countries and as majorities in high income and peaceful Muslim countries like Malaysia, Brunei, Turkey, Qatar, the United Arab Emirates and Saudi Arabia.

But when factors like extensive poverty, unemployment, income inequality, poor education opportunities, inequitable access to healthcare, violent conflict, political repression, abuse of rights, lack of information empowerment, and the position of women are factored in, about a billion Muslims in a majority of the Muslim countries, or two-thirds of the total global Muslim population, are at risk.

The tragic human security conditions in conflict-ridden and occupied Afghanistan, Iraq, Palestine, and war-torn Syria, Somalia, Sudan and South Sudan — the last four are occupied, but, only by themselves — are only too painfully evident to us all.

But there are also hundreds of millions of Muslims who live in vulnerable communities or areas in India, Pakistan, Bangladesh, Myanmar, Indonesia, Yemen, Nigeria, Niger, Ethiopia, Sierra Leone, Benin, Chad and Senegal.

Put bluntly, the Muslim world is home to a disproportionate share of all the seven areas of human insecurity identified by the UNDP.

Vulnerabilities to aggression, foreign intervention and occupation, sectarian, tribal and ethnic strife, joblessness, poverty and severe income disparities, disease, crime, undemocratic regimes, political repression and violation of rights, discrimination against and abuse of women, and even natural and environmental disasters are all too common and even pervasive in large parts of the Muslim world.

In the Arab world, including the imploding crucible that is Syria today, as well as in Afghanistan, the destruction that Muslims have managed to inflict upon themselves has been colossal. This has been aggravated by some countries that have colluded with foreign powers and involved themselves in the affairs of fellow Arab and Muslim nations.

The Sunni-Shia fault line that runs through the Arab crescent and the Persian Gulf has been a major destabilising factor. It pits Muslim against Muslim not only within countries but between countries as well.

Together with historical tribal enmities, it underlies much of the unrest in the Arab world today. The confrontation between Arabs and Persians, for example, is an age-old enmity that has further embroiled West Asian nations in intra-Muslim struggle and conflict.

The Sunni-Shia sectarianism, tribal animosities and Arab-Persian power plays have undermined not just the national resilience of Muslim countries in West Asia and North Africa. They have also rendered the countries even more vulnerable to the machinations, military intervention and occupation by foreign powers and weakened their capacity to present a collective response to Israel.

Next to war and violence, nothing degrades human security and human dignity more than extreme poverty and widespread unemployment, for their effects are often hunger, malnutrition, starvation, illiteracy, disease and crime.

Such conditions also contribute to a highly combustible political environment.In this regard, poverty and unemployment levels are unacceptably high in much of the Muslim world. No less than 40 to 65 per cent of the population live below the national poverty line in nearly a third of all Muslim countries or those with a sizeable Muslim component, for which there is reliable information.

Democratic governance, protection of human rights and support for gender equality are also key attributes of human security and human development that are in short supply in many of those countries.

Taken together then, the human security landscape of the Muslim world is a grim and dismal one. However, this situation has nothing to do with Islam. It is, in fact, the very antithesis of all that Islam stands for.

Instead, the problems have more to do with factors such as sectarian, tribal and class rivalries; the consequences of colonisation including borders drawn without regard to the glue that natural demographic patterns would have yielded; the strategic location and resources of the Gulf region that make them perennial targets of predatory powers; the insecurity of small states that seek alliance with foreign powers; the dislocation that the imposition of the state of Israel created and the half century of violence that has followed in the absence of a political solution; the grip of unhealthy tribal traditions and customs that distort religious interpretation and inhibit human development; and the absolute lack of resources in some sub-Saharan countries.

As I observed earlier, the improvement of human security, as also in the case of human development, is a task mainly to be done at home. Indeed, diplomacy is one of the means which can be used for that purpose. It normally comes into prominence, however, only when a country is at war or is under military threat, or when there is foreign intervention in internal conflicts.

For those Muslim countries and their peoples that are in this unfortunate situation, like Afghanistan, Iraq, Syria, Palestine, Sudan (and thus South Sudan), diplomacy becomes a crucial instrument.

But good diplomacy — I am using “diplomacy” here interchangeably with foreign policy — can also be important for alleviating other aspects of the human security conditions that prevail in many Muslim communities.

Diplomacy has become indispensable in this globalised age when the politics, economics and security of nations and communities are becoming increasingly enmeshed.

Although domestic policies are primary, human security and human development are impossible to pursue without engagement with the outside world and without interaction with other important actors.

This is especially the case for the less developed nations with scarce or limited resources that make up a large proportion of the Muslim world.

If diplomacy — that is diplomacy as in foreign policy — is important in the pursuit of human security, what has Islam to offer to the endeavour? How can Islam affect diplomacy so as to provide better human security in the Muslim world and beyond?

When I surveyed the literature on Islam and diplomacy, the work that stood out was the Rusul al-Muluk, or Messengers of Kings. Written in the tenth century, or about 300 years after the demise of the beloved Prophet Muhammad (PBUH), it describes the diplomacy that was practised by the Arabs and Muslims from pre-Islamic days to its own time.

It also presents and makes use of examples of Arab diplomatic practice drawn from the Quran and other sources used by Muslim scholars.

The work examines extensively the use of emissaries, diplomatic exchanges, the types of treaties and agreements that the Prophet and other Muslim leaders entered into with Muslim and non-Muslim tribes and empires, the principles of diplomatic negotiations, the codes that guided war and peaceful settlement, the granting of asylum, and the treatment of prisoners, refugees and minorities.–Part I (May 18, 2013)

MUCH of the diplomacy that is described in the book Rusul al-Muluk, or Messengers of Kings, existed before Islam, and it also continued to be practised by non-Muslim nations after the revelation of Islam.

From translations of ancient writings such as Letters from Early Mesopotamia and the Amarna Letters, we learn that there was a thriving culture of diplomacy that had been practised as far back as the 3rd millennium BC, in the very region we now call West Asia and North Africa.

The diplomacy depicted in that literature, practised by the ancient kingdoms and empires of Mesopotamia, Babylonia, Assyria and Egypt, among others, included diplomatic codes of conduct, exchange of emissaries, arbitration and mediation, negotiation of treaties and treatment of political fugitives.

Diplomacy in somewhat less ancient times developed in similar modes in the great civilisations of China and India. For example, the “realist theory” of International Relations can be traced back to Sun Tzu in 6th century BC China and Kautilya in 3rd century BC India. The Persian, and the Roman and then the Byzantine Empires, of course, were famous for their diplomatic endeavours.

The revelation of Islam, however, brought a sea-change in the conduct of foreign policy and the practice of diplomacy as Muslim political sway expanded in West Asia and beyond.

Islam’s conception of humanity, the Ummah, its world view and its ethos and values were infused into foreign policy and diplomatic practice. The personal character of the Prophet (PBUH), guided by the principles and teachings of Islam, also left its imprint.

The Rusul al-Muluk, the Islamic work which I referred to earlier, is not an ordinary manual on diplomacy; rather, it is a work that boldly argues for a very modern theory of International Relations, by rejecting warlike policies in favour of low-key but firm diplomacy with the pragmatic outlook of constructive realpolitik — all done with the aim and intention of securing the common goal of human security among all mankind.

The ultimate purpose of Islam is the well-being and salvation of all humankind, irrespective of national, ethnic or even religious identity. Islam’s horizon is the Universe: it does not stop with the Muslim Ummah.

This is the bedrock upon which universal human well-being (including what is now called “human security”) is to be built, both domestically and abroad, across nations.

Development, peace, security, justice and human dignity are for all peoples regardless of race or gender or even faith. Human beings are created by God to fulfil the dual role of the person as a servant of God (al-’Abd) and as His representative (al-Khalifah) on Earth.

The goals of Islam that have a bearing upon the prevailing ideas of human security – as well as human development – are founded on two concepts. One is that of human well-being: Sa’adah, which can also mean success, happiness, prosperity or felicity.

The second is the Muslim concept of the good life in this world and in the next world: Hayatun Tayyibah. The balanced fulfilment of both the material and spiritual needs of all human beings will lead to human well-being and the good life that fulfils human security needs.

A fundamental core of human security is the freedom from want, and this is best assured by education and knowledge, which can help secure jobs and a better livelihood. In Islam the pursuit of knowledge, both spiritual and material, is nothing short of a religious obligation. Acquisition of knowledge is considered a form of worship and will bring a Muslim closer to God.

Islam also enjoins ethical action (‘Amal Salih), morality (Akhlak), justice and fairness (‘Adl), moderation (‘Iffah), integrity (Amanah), and provision for the poor and the disadvantaged.

The payment of zakat, or charity, by the rich for the poor is obligatory. Islam’s principle of Tawhid further demands that there be no exploitation among human beings. All these teachings point to a basic concern with what we call “human security”.

In the field of foreign policy, diplomacy and war, the Islamic tradition privileges negotiations and peaceful resolution of disputes over war. It further specifically forbids the taking of innocent life and damage to property.

It also enjoins humane treatment of prisoners and due protection for refugees. Our tradition counsels just peace, when the circumstances allow.

The Islamic faith, thereby, provides a unique religious, normative and legal reference for the formulation and implementation of foreign as well as domestic policies to protect and promote human security.

So what roles can Islam play in the contemporary diplomacy of Muslim countries in their pursuit of human security? I can think of at least three.

FIRST the great achievement of the Prophet (PBUH) in bringing peace and reconciliation to the warring tribes and communities of Arabia can be invoked to inspire and reinforce efforts to reduce enmity among Muslim countries and communities and make their relations harmonious.

There is no more necessary and important effort than the active pursuit of reconciliation for healing the wounds caused by conflicts, bloodshed and violence.

This is especially pressing for the conflicts in West Asia and North Africa, where Sunni-Shia sectarianism and tribal conflicts are tearing nations apart and bringing them into conflict with one another.

What is happening in Syria, Iraq and Afghanistan with the involvement of other Muslim countries as well as outside powers is producing the very antithesis of the peaceful aims and teachings of Islam. It strikes at the very core of the human security concerns of the affected multitudes, which include millions of displaced persons and refugees.

SECOND Islam is all about human dignity, human development and human security. Yet in so many countries of the Muslim world, it is these very things that are in shortest supply.

The values and teachings of Islam can be more effectively mobilised to spur greater efforts by Muslim countries, acting individually as well as collectively, through such institutions as the Organisation of Islamic Cooperation (OIC) and the Islamic Development Bank (IDB), to bring more and better development.

These efforts could embrace marginalised minority communities, such as the Rohingyas in Myanmar and the Muslims in southern Thailand and southern Philippines.

Among the programmes that should be highest in priority are those aimed at improving education and health facilities, reducing income inequities, bringing greater protection and emancipation for women, strengthening representative government, and enhancing standards of governance.

These, in fact, are some of the causes that are already being championed by organisations such as the Islamic Development Bank, but progress will continue to be slow unless there is greater commitment from many member countries.

THIRD the non-governmental infrastructure for human development and human security greatly needs to be developed in many Muslim countries. Organisations in civil society and the private sector have a vital role to play and an important contribution to make.

 In areas such as education, healthcare, welfare activities, protection of women and children, crime prevention and environmental conservation the participation of voluntary organisations is necessary and invaluable, especially when they are supported by the business sector and the state.

Muslim nations, again, individually as well as collectively, can do much to foster and strengthen the infrastructure within their own countries and sometimes even in others.

If we take our humanity seriously, and are motivated by the guidance conveyed in our sacred traditions, then we should expand our conception of security to embrace its human dimensions.

A foremost requirement for promoting human security is the recognition of diversity and differences in our global context, as well as within the boundaries of individual nations.

To this end we should cultivate awareness and understanding of the worldview of others, and learn to respect their various traditions.

This is why inter-cultural competence and training for understanding other religions and worldviews is important – both for non-Muslims to appreciate Islam, and for Muslims to appreciate cultures and peoples belonging to other traditions.

Indeed the search for human security is the gateway to the future of a reformed global order.The combined experiences of human societies in the modern era in the economic, political, social and cultural domains of life are pushing towards recovering the basis of security reflected in basic human needs and hopes.

Peace will only be achieved between nations, and among the diverse peoples within nations, when security is understood in these terms. (Part II-May 20, 2013)

http://www.nst.com.my

GE-13 is Neither Free nor Fair

May 17, 2013

Bishop Paul Tan and I agree: GE-13 is Neither Free nor Fair

Bishop Paul Tan and I  have no problem in agreeing that GE-13 is “anything but free and fair”. We are not in the business of political hedging, preferring to state our views as clearly we can. No mincing of words for fear of incurring the displeasure of the powers that be.In fact, we owe it to our government to tell them the truth, however unpleasant that maybe.

As Malaysians who are concerned about freedom, democracy, and justice, we support BERSIH. We are with Ambiga and her civil society friends and are very pro-electoral reform. BERSIH must continue its work.

Having stated my position on free and fair election, I accept the appointment of Prime Minister Najib and his Cabinet by our beloved King. His Majesty has acted in the best interest of our country by accepting the election results. Consequently, countries with whom we have diplomatic relations have accepted the new Government.

The Opposition, however, is free to contest the election results in our country’s courts. In the meantime, the business of government must begin in earnest since uncertainty is bad for our economy and our morale.

The new Najib Government should deal the following issues with a great sense of urgency:

• Fight Corruption and racism.
• Free the media.
• Manage the economy and deal with the serious budget deficit and the mounting national debt.
• Promote a merit based system of government.
• Restore Judicial Independence.
• Revamp the Education System.

– Din Merican

Bishop: Polls anything but free and fair

RK Anand | http://www.freemalaysiatoday.com

Bishop Paul Tan explains that while he abstains from partisan politics, he supports electoral watchdog Bersih in its cause for free and fair polls.

INTERVIEW

PETALING JAYA: An outspoken Catholic cleric has cast aspersion on the 13th general election with regard to the battle for Putrajaya being clean and fair.

Bishop Paul Tan said this in reference to the report of the Institute of Democracy and Economic Affairs (IDEAS) and Centre for Public Policy Studies (CPPS).

“IDEAS and CPPS have done an interim report. In it, there is this conclusion: ‘GE13 was only partially free and not fair’. I find it difficult to believe that the report could conclude this…

“But when it concluded ‘only partially free’ for the three reasons given that

Malaysians want a competent and efficient institutions.

are fraught with irregularities as reported in the said report, the people involved are not objective,” he said.

“From the multiple examples of irregularities arrived in the report, permit me to use a stronger phrase than that of IDEAS and CPPS: GE13 is anything but transparently ‘free and fair’,” he added.

The Bishop, who heads the Malacca and Johor diocese, conceded that he could be wrong but stressed that he was morally obliged to speak out at this time because of the immorality practiced before and during GE13.

“If I didn’t speak up, I would have to answer to my God and my Church,” he said.

Tan said while he obeyed the Catholic Church’s teaching that clerics must not take sides in partisan politics, he noted that the church also taught that clerics must speak out against immoralities and against all that go against human rights.

“As a religious person in my role as bishop, I am in a dilemma vis-a-vis to what extent should I allow a certain degree of immorality or infringement against human rights to go on unpunished before denouncing them publicly,” he added.

For a long time, Tan said, there had not been sufficient action taken against immorality in its widest sense, especially corruption.

“Some attempts have been made by related government departments to deal with the matter. In ‘grosso modo’, it has not been effective. Only a few small fish have been caught, the big fish was left untouched.

“The consequence of this ‘laissez faire’ lifestyle is that it has produced massive corruption, cheating and immoral manipulation of the people to garner votes for one’s political party. Unfortunately, this cuts across the boundaries of all parties. The degree lies in the extent of corruption,” he added.

‘Are we not ashamed?’

The Bishop also noted that the most obvious example was the lavish manner in which the Najib administration threw cash to get votes.

“Where is our country going? Are cheating and corruption condoned as part of our Malaysian culture? Are we not ashamed of our country being an immoral society? We must all reflect and examine our consciences. What sort of nation do we want our country to be, moral or immoral? Undoubtedly, all will want a ‘moral country’.But what sort of morality do we want? It is here that the degree of permissiveness comes into play. To what extent can we tolerate it before stringent action is taken to punish the unscrupulous?” he said.

Condemning money politics, Tan said even if it was considered “legalised corruption”, it does not exonerate the guilt of the ones involved.

“Corruption is corruption, even if one was to dress it up like a queen. A toilet remains a toilet, even if one gives it the beautiful terms of ‘comfort room’ or ‘powder room’,” he added.

The Bishop explained that while he abstained from partisan politics, he supported electoral watchdog BERSIH in its cause for free and fair polls.“Any rational and moral person will support it,” he said.

GE-13: An Election that puts an end to business as usual

May 4, 2013

GE-13: An Election that puts an end to business as usual (Mahathirism?)

by Jahabar Sadiq@http://www.themalaysianinsider.com

“No government can now simply implement a top-down decision without being questioned by the people or told in no uncertain terms how unpopular some ideas are…Ideas are being shared and shaped through the Internet, people, young and old, are coming together and ahead of politicians whose mindsets belong to the trunks of their forefathers who traveled in the previous century.”

No matter which coalition makes the government in the early morning of May 6, one thing is certain — Malaysia has changed and it is business unusual for the new administration.

With the respected Merdeka Center for Opinion Research’s latest survey showing a dead heat between both Barisan Nasional (BN) or Pakatan Rakyat (PR), the winner’s first job is to respond to a populace that questions and demands more from its government.

Forget the docile and subservient citizenry that thought government always knew best. That worked for some 55 years but this is a new Malaysia where the people are more advanced and ambitious in thought than their politicians.

A population where pensioners and the bloated civil service are no longer a sure vote bank, where racial barriers have collapsed and people are one as Bangsa Malaysia — concerned more about the economy than the personal lives of politicians.

This single-mindedness and unity comes despite the overt racist tones in the campaign since Nomination Day on April 20 or the fear-mongering being played out by certain political parties.

The results of the latest Merdeka Center poll — 42 per cent of the voters agreeing that PR could govern the country against 41 per cent who felt only BN should rule Malaysia — reflect how far the country has come from elections where politicians just pleaded to be a strong opposition.

“Change happens all the time and in the same way that none of us can ever imagine Malaysia regressing to an age where women are not allowed access to education, we cannot ever imagine going back to a politics that is simplistic, patronising, top-down and unchallenged.

“Even the former Opposition parties have learned, over the past five years, what it is really like to be in power and having to be accountable to NGOs and public opinion. It’s been a learning experience for all of us, and I believe we have grown a little wiser too,” well-known academic Dr Farish A. Noor wrote in an essay today.

That wisdom has meant that no government can now simply implement a top-down decision without being questioned by the people or told in no uncertain terms how unpopular some ideas are.

Ideas are being shared and shaped through the Internet, people, young and old, are coming together and ahead of politicians whose mindsets belong to the trunks of their forefathers who travelled in the previous century.

The old must make way for the new, just like party-owned newspapers that will be held accountable for their reportage. The days of being the only source of credible news is over for the likes of the New Straits Times, The Star, Berita Harian or Utusan Malaysia.

There is now a proliferation of news portals and growing rise of video clips that tell a story better and faster than any propagandist can. The new media has become the standard way of creating and consuming news and information, leaving in its wake shrinking audiences for newspapers and state broadcasters that refuse to step into the 21st century.

Why? Because there are more young people now than ever before. More of who want a say in their country Malaysia. More who will come to vote tomorrow as eagerly as those Malaysians abroad last Sunday.

We have changed as Malaysians. We are no longer bystanders and an audience of a national narrative written by politicians. We are the active participants shaping Malaysia’s direction and discourse, looking askance at politicians who think nothing of shifting thousands of voters across the country before the polls.

This is the new Malaysia that will vote tomorrow for a better Malaysia for all who proudly call themselves Malaysians. The Malaysia that keeps its government on its toes for fear of losing its job.

This May 6 the new government will be one that learns more from the people than it can teach the people unlike the past 55 years.

* Jahabar Sadiq runs The Malaysian Insider.

Malaysian government-linked corporations crowd out private investment

May 1, 2013

April 25, 2013

by Jayant Menon, ADB and ANU, and Thiam Hee Ng, ADB

Private investment in Malaysia never fully recovered from the impact of the Asian financial crisis.

Foreigners have continued to shun Malaysia, but it now seems that even domestic investors are fleeing, with Malaysia becoming a net exporter of capital since 2005. One explanation for the sluggish performance of domestic private investment relates to the crowding-out effect of the growing dominance of government-linked corporations (GLCs) in many sectors. The influence of GLCs, however measured, is both widespread and pervasive.

The GLC share of operating revenue is approximately one-third in the aggregate, and they control more than half the industry share in utilities, transportation, warehousing, agriculture, banking, information communications and retail trade. GLCs employ around 5 per cent of the national workforce and account for approximately 36 per cent and 54 per cent, respectively, of the market capitalisation of Bursa Malaysia and the benchmark Kuala Lumpur Composite Index.

The pervasiveness of GLCs suggests they may present a formidable barrier to both competition and the entry of new private firms. This is also evident in their ability to exercise significant market power and use their special access to government and regulatory agencies to their advantage. Provisions in the government’s affirmative action program, the New Economic Policy (NEP) and its more recent incarnations also tend to favour GLCs, such as through government procurement restrictions.

Indeed, many GLCs were spawned as vehicles to achieve the redistributive objectives of the NEP. Since a key target was to increase the Bumiputera (Malay and indigenous peoples) share of wealth, rather than income, to 30 per cent, GLCs seemed the perfect instrument. While this target has yet to be met, the wealth share of Malays has increased at the same time that income inequality within the Malay community has worsened considerably. Many point to the rise of GLC-centred crony capitalism and a culture of corruption and patronage as contributing to this rise in inequality.

Recognising the problems with GLCs, and in a bid to improve the investment climate, the government launched its 10-year Transformation Programme in May 2004, with divestment of GLCs a key objective. With the deadline looming, progress has been lacklustre — of the 33 GLCs up for divestment, only 15 had been completed as of February 2013. Worse still, this limited divestment has been offset by new investments, with a spate of acquisitions by GLCs in private sector finance and property development for instance, making it more of a diversification than a divestment program.

So, are GLCs really crowding out private investment? For the first time, we provide empirical evidence on this relationship using a detailed dataset of 443 publicly listed firms covering the period 2007 to 2011 from Oriana. After accounting for the other determinants of investment, it is clear that a stronger GLC presence generally has a discernible negative impact on private investment. Also in question is whether there is a threshold effect when it comes to the share of GLC presence in an industry; that is, whether private firms tend to invest less to begin with if the share of GLC revenue in an industry is particularly large.

It would seem that when GLCs account for a dominant share of revenues in an industry, investment by private firms in that industry is significantly negatively impacted. Conversely, when GLCs do not dominate an industry, the impact on private investment is not significant. Even by varying the threshold by 10 percentage points in both directions, this change does not affect the original finding of a significant negative relationship between GLC share and private investment.

To revive private investment in Malaysia, the government must not only redress its growing fiscal deficit, but also expedite its program of divestment. While a growing fiscal deficit and the rising dominance of GLCs may both be crowding out private investment, a genuine privatisation program designed to reduce the role of GLCs would also address the fiscal constraint, providing a further boost to the investment climate. An improvement in overall governance and transparency would be an important, indirect, plus.

Jayant Menon is Lead Economist at the Office of Regional Economic Integration, Asian Development Bank, and Adjunct Fellow at the Arndt-Corden Department of Economics, the Australian National University.

Thiam Hee Ng is Senior Economist at the Office of Regional Economic Integration, Asian Development Bank.

The views expressed in this paper are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank, or its Board of Governors or the governments they represent.

http://www.eastasiaforum.org/2013/04/25/malaysian-government-linked-corporations-crowd-out-private-investment/

Governments should be colour-blind

May 1, 2013

Social Policies

Time to scrap affirmative action

Governments should be colour-blind

Apr 27th 2013 |From the print edition

ABOVE the entrance to America’s Supreme Court four words are carved: “Equal justice under law”. The court is pondering whether affirmative action breaks that promise. The justices recently accepted a case concerning a vote in Michigan that banned it, and will soon rule on whether the University of Texas’s race-conscious admissions policies are lawful. The question in both cases is as simple as it is divisive: should government be colour-blind?

America is one of many countries where the state gives a leg-up to members of certain racial, ethnic, or other groups by holding them to different standards. The details vary. In some countries, the policy applies only to areas under direct state control, such as public-works contracts or admission to public universities. In others, private firms are also obliged to take account of the race of their employees, contractors and even owners. But the effects are strikingly similar around the world (see article).

The burden of history

Many of these policies were put in place with the best of intentions: to atone for past injustices and ameliorate their legacy. No one can deny that, for example, blacks in America or dalits in India (members of the caste once branded “untouchable”) have suffered grievous wrongs, and continue to suffer discrimination. Favouring members of these groups seems like a quick and effective way of making society fairer.

Most of these groups have made great progress. But establishing how much credit affirmative action can take is hard, when growth also brings progress and some of the good—for example the confidence-boosting effect of creating prominent role models for a benighted group—is intangible. And it is impossible to know how a targeted group would have got on without this special treatment. Malays are three times richer in Singapore, where they do not get preferences, than in next-door Malaysia, where they do. At the same time, the downside of affirmative action has become all too apparent.

Awarding university places to black students with lower test scores than whites sounds reasonable, given the legacy of segregation. But a study found that at some American universities, black applicants who scored 450 points (out of 1,600) worse than Asians on entrance tests were equally likely to win a place. That is neither fair on Asians, nor an incentive to blacks to study in high school. In their book “Mismatch”, Richard Sander and Stuart Taylor produce evidence that suggests affirmative action reduces the number of blacks who qualify as lawyers by placing black students in law schools for which they are ill-prepared, causing many to drop out. Had they attended less demanding schools, they might have graduated.

Although the groups covered by affirmative action tend to be poorer than their neighbours, the individuals who benefit are often not. One American federal-contracting programme favours businesses owned by “socially and economically disadvantaged” people. Such people can be 87 times richer than the average American family and still be deemed “disadvantaged” if their skin is the right colour. One beneficiary of South Africa’s programme of “Black Economic Empowerment” is worth an estimated $675m; he is also the deputy president of the ruling party. Letting members of certain groups charge more and still win public contracts is nice for the few who own construction firms; less so for the many who rely on public services. The same goes for civil-service quotas. When jobs are dished out for reasons other than competence, the state grows less competent, as anyone who has wrestled with Indian or Nigerian officialdom can attest. Moreover, rules favouring businesses owned by members of particular groups are easy to game. Malaysians talk of “Ali-Baba” firms, where Ali (an ethnic Malay) lends his name, for a fee, to Baba (a Chinese businessman) to win a government contract.

Although these policies tend to start with the intention of favouring narrow groups, they spread as others clamour to be included. That American federal programme began by awarding no-bid contracts to firms owned by blacks, Hispanics and Native Americans; now it covers people with ancestry from at least 33 countries. In India 60% of the population are eligible for privileges as members of scheduled castes, tribes or “other backward classes”. Such policies poison democracy by encouraging divisions along lines drawn by discriminatory rules. The anger thus stoked has helped stir bloody conflicts in India, Rwanda and Sri Lanka. And such rules, once in place, are almost impossible to get rid of. In 1949 India’s constitution said quotas should be phased out in ten years, but they are now more widespread than ever. America’s policies have survived decades of legal pushback, though not unscathed.

The content of their character

The University of Texas (UT) justifies discriminating in favour of black people not on the ground that society owes it to them, but because, it claims, a diverse university offers a better education to all its students. That is a reasonable argument—some companies benefit from understanding a variety of customers, for instance, and the police probably keep order better if enough of them share a culture with the neighbourhood they patrol—but it does not wash for most institutions. In UT’s case, although colleges benefit from a diversity of ideas, to use skin colour as a proxy for this implies that all black people and all Chinese people view the world in a similar way. That suggests a bleak view of the human imagination.

Universities that want to improve their selection procedures by identifying talented people (of any colour or creed) from disadvantaged backgrounds should be encouraged. But selection on the basis of race is neither a fair nor an efficient way of doing so. Affirmative action replaced old injustices with new ones: it divides society rather than unites it. Governments should tackle disadvantage directly, without reference to race. If a school is bad, fix it. If there are barriers to opportunity, remove them. And if Barack Obama’s daughters apply to a university, judge them on their academic prowess, not the colour of their skin.

From the print edition: Leaders

___________________

Malaysia

A Never Ending Policy

Elections in May could mark a turning point

Apr 27th 2013 | KUALA LUMPUR |From the print edition

To see the Video [click]  http://econ.st/ZkVObv

THE policies which favour ethnic Malays and other indigenes at the expense of Malaysia’s ethnic Chinese and Indian citizens are an oddity in the realm of state discrimination. It is not unusual that they favour a majority, the two-thirds of the population known as the bumiputra, or sons of the soil. But it is peculiar that their Chinese and Indian targets have never ruled Malaysia.

Their presence in the country, though, was encouraged under British colonial rule without the consent of native Malays. After independence this became a source of grievance, one exacerbated by the minorities’ wealth. In 1969 mobs burned Chinese shops, killing hundreds. The government responded with a “New Economic Policy” (NEP) aimed at improving the lot of the bumiputra with preferences in university admissions and for civil-service jobs. Billed in 1971 as a temporary measure, the NEP has become central to a system of corrupt patronage.

Attacking that system is the main plank of the opposition’s campaign in the election to be held on May 5th—the first since independence in which it has a real, if small, chance of beating the ruling Barisan Nasional coalition, dominated by the United Malays National Organisation. Both government and opposition agree that the system of discrimination should be dismantled, but the government fears alienating the hardline Malay vote.

Provisions that require a certain proportion of the shares of any publicly quoted company to be in bumiputra hands, and that favour bumiputra-owned firms for various government contracts, undoubtedly enrich a few well-connected Malays. And the policies seem good for bumiputra civil servants: the civil service is now 85% Malay, if one excludes teachers. But they do little for the rest. “There has been little or no trickle-down effect, and I think more bumiputra know this today,” says Wong Chen of Pakatan Rakyat, the main opposition party. The increasing wealth of ethnic Malays in past decades echoes rising fortunes across South-East Asia, casting doubt on the idea that affirmative action has been a particular help.

Malaysia’s Chinese and Indian citizens chafe at being second-class citizens. Quotas in university admissions are particularly resented. Most universities in Malaysia reserve 70% or more of their places for bumiputras. Chinese and Indian students flock instead to private and foreign ones. Those who leave often stay away. A World Bank study in 2011 found that about 1m Malaysians had by that stage left the country, which has a total population of 29m. Most were ethnic Chinese, and many were highly educated. Some 60% of skilled emigrants cited “social injustice” as an important reason for leaving Malaysia. This exodus makes it a less attractive place to invest in.

Supporters of the NEP argue that, without such assistance, Malays will not catch up economically or academically. Critics worry that it dulls their incentives to excel. There is evidence of a skills gap. Nearly half the managers at Malaysian manufacturing firms surveyed by the World Bank said that the ability of local skilled workers to handle information technology was either “poor” or “very poor”. Mahathir Mohamad, a former Prime Minister who in his time extended the reach of the NEP, lamented in 2002 that bumiputras too often treat university places as “a matter of right”, neglecting their studies.

A survey in 2008 found that 71% of Malaysians agreed that “race-based affirmative action” was “obsolete” and should be replaced with a “merit-based policy”. The ruling coalition pays lip service to such ideas and has tinkered with the racial preferences—lowering, for example, the fraction of a company’s shares that has to be in bumiputra hands when a service company goes public. The opposition argues for “colour-blind” affirmative action—that is, policies that favour the poor in general, rather than the bumiputra specifically. But are enough of the sons of the soil ready to make the change?

From the print edition: Briefing

http://www.economist.com/news/briefing/21576654-elections-may-could-mark-turning-point-never-ending-policy

GE-13: A Hung Parliament Is Not Necessarily Bad

April 29, 2013

GE-13: A Hung Parliament Is Not Necessarily Bad (Last of Four Parts)

 by Dr.M.Bakri Musa, Morgan-Hill, California

Many fear a hung parliament as they think that would lead to chaos and uncertainty. Yes, there may be both but neither is inevitable. On the contrary I see many potentially redeeming aspects that could benefit citizens, the permanent establishment, and yes, even those politicians.

For citizens, seeing these freshly-victorious politicians brazenly jockeying for positions would be both instructive and revealing. It would be quite a sight to watch them behave worse than hookers. At least hookers are consumed with satisfying their present customers first, and would solicit new ones only after they have done that. More importantly, they do both discreetly.

Those politicians on the other hand would be openly and lustily auctioning themselves to the highest bidder without even a promise of satisfactory performance to their current customers – citizens who had only recently voted for them. Those politicians would whore themselves brazenly. What matters to them would only be the price their new customers would be willing to pay, regardless how filthy and disease-ridden they are. Damn the consequences, for them or the nation

The jockeying would be intense, shameless and endlessly shifting, threatening both Barisan and Pakatan. It would not be below MCA for example, to align itself with DAP and throw their weight behind Pakatan, demanding an outrageous price in return. Or MCA could demand a stiff price for remaining in Barisan. Not to be outdone, as alluded earlier, PAS could bolt Pakatan and align itself with UMNO in an ugly chauvinistic attempt at reviving Ketuanan Melayu.

UMNO would sell its soul to get PAS support, and PAS in turn would readily sign a pact with the devil given the right price. There would be only one certainty; our politicians would finally be exposed for all their corruptness and hideousness. In the end unfortunately, citizens and Malaysia would be paying the terrible price.

Perhaps the nation needs such a sordid spectacle to jolt it into realizing that elections have consequences, and that the politicians and leaders we have today are far different from the earlier generation that brought us merdeka.On the other hand, our politicians may well surprise us.

Without being unnecessarily Pollyannaish, a few might discover that politics is after all a noble profession, and at its best and essence, a fine exercise in the art of compromise in order to get things done for the good of all.

At the very least a hung parliament would prompt us to be more prudent on our voting and not be so casual with this important exercise of democracy. If that would also encourage otherwise thoughtful Malaysians to offer themselves as candidates, then the whole exercise would not have been futile.

A hung parliament would also have a salutary effect on the permanent establishment.The last time there was a similar debacle, in Perak following the 2008 elections, the permanent establishment including the sultan, did not acquit themselves well.

Who could forget the spectacle of the Speaker being hauled out of the Assembly desperately clinging on to his chair, or the Raja Muda, the Sultan’s representative, being forced to cool his heels in an adjacent room while waiting out the mayhem? It was not pretty. The stench stained all, and stayed to this day.

You can be certain that this time, with the real possibility of Barisan being toppled, members of the permanent establishment would be more circumspect for their own selfish reasons. Thus I do not expect blatant displays of partisanship as we saw in Perak. To add flavor to that, the King today, DYMM Sultan Abdul Halim, was the Sultan of Kedah when PAS took over from UMNO. Thus working with a non-UMNO chief executive would not be a novelty for him.

Once we have established this fact at the Federal level, all the other Sultans at the state level would follow suit. They would, out of concern for their own survival, no longer be so blatantly partisan. That can only be good for them and the country.

A hung parliament is nothing to fear; it is just another though less clear-cut expression of a Barisan defeat. Stated differently, a hung parliament is a not-so-pretty Pakatan victory.

Malaysia Needs to Get Off the Road to Mediocrity

April 24, 2013

By William Pesek Apr 23, 2013 10:00 AM GMT+0800

In his bid for re-election, Malaysian Prime Minister Najib Razak has dispensed with all shame. Vote for me, he has essentially declared, or Malaysia will suffer “catastrophic ruin” and an “Arab Winter” of the kind that has undone economies from Egypt to Libya.

Both warnings are ludicrous — signs of how worried Najib’s National Front coalition is of losing power for the first time since 1957. They speak to the desperation of a government that has come to serve itself, not Malaysia’s 29 million people. And they are emblematic of a leader whose talk of bold change hasn’t been matched by action.

Najib’s claim is this: Giving the Opposition, led by former Deputy Prime Minister and Finance Minister Anwar Ibrahim, a chance to lead on May 5 would reverse all the gains Malaysia has made since the 2008 financial crisis. The economy would crater, stocks and the currency would plunge, and chaos would reign.

Change through the ballot box in a democracy should never be disruptive or chaotic, and rhetoric suggesting otherwise is disingenuous. Najib likes to say: “The time has come for Malaysians to make a decision.” Actually, the time has come for Malaysia’s government to grow up.

Najib’s scaremongering, some of which came out of an April 17 Bloomberg News interview, smacks of the re-election campaign run almost a decade ago by then U.S. President George W. Bush. Instead of this vote-for-me-or-you’re-in-danger appeal, Najib should scare up some headline-grabbing reforms that leave Malaysia better off in the future.

Developing Complacency

The country’s biggest problem is complacency. Malaysia Inc. can be a slow-moving, change-resistant animal in a very dynamic neighborhood. Nations as diverse as China, Indonesia, the Philippines, Thailand and Vietnam are evolving in ways that have enabled them to leapfrog peers in a few years. They are all competing for the same infrastructure dollars, factory projects, bond deals and stock issues. Singapore, meanwhile, has become the beneficiary of many of Malaysia’s best and brightest, who have emigrated in search of a more merit-based economy.

Malaysia is a resource-rich nation with huge potential. But it remains shackled to a four-decade-old affirmative-action program — favoring ethnic Malays — that turns off foreign investors and undermines national productivity. This so-called New Economic Policy was devised by Najib’s father, Abdul Razak Hussein, the country’s second Prime Minister.

Najib, 59, has indeed rolled back some of those preferences to encourage investment. He did away with a requirement that foreign companies investing in Malaysia and locally listed businesses set aside 30 percent of their equity for ethnic Malays and indigenous peoples known as “bumiputera.” It’s time to go much further and dismantle all race-based policies.

Little Difference

When, for example, can more ethnic Chinese expect to start winning the really big government contracts? Here, Najib’s real quarrel may be with his own government. Anwar is pro-markets and pro-investment, too. When you look at the core of what Najib is promising voters — less corruption and higher living standards — it’s not wildly different from the opposition’s message. The trouble is, Najib is navigating a 13-party coalition whose interests are as entrenched as any in the world. His partners are pushing back quite assertively, afraid of losing the Malay vote they could once take for granted.

Money Politics

The Opposition has gained traction with its claims that Malay-run companies, from power producers to toll-road operators, unfairly benefit from their ties to the government. Najib’s pledges to clamp down on crony capitalism and to instill greater transparency have been undercut by measures such as the ban on street protests that passed on his watch. Now, many voters hope to wipe the slate clean.

When he’s not trying to frighten voters, Najib is touting Malaysia’s 6.4 percent growth as proof he is a radical-change agent. In fact, much of Southeast Asia also is booming, and the government is helping to artificially fuel growth with populist handouts.

Even more than the $444 billion of private sector-led projects ranging from oil storage to a mass-transit railway that Najib has championed, the country needs reforms that will revitalize the system as a whole. The government should be encouraging more startup companies, widening the tax base and hacking away at subsidies that institutionalize complacency.

All too often, rapid gross-domestic-product growth is used as a smoke screen to hide underlying cracks in an economy’s long-run potential. In Malaysia’s case, the numbers mask a government too focused on staying in power to do its job. If anything should be scaring Malaysian voters, it’s that.

(William Pesek is a Bloomberg View columnist. The opinions expressed are his own.)To contact the writer of this article: William Pesek in Tokyo at wpesek@bloomberg.net

To contact the editor responsible for this article: Nisid Hajari at nhajari@bloomberg.net

http://www.bloomberg.com/news/2013-04-23/malaysia-needs-to-get-off-the-road-to-mediocrity.html

Providing Balanced Development for ALL

April 17, 2013

by Datuk Dr Zakri Abdul Hamid@http://www.nst.com.my

FULFILLING THE TRUST: Najib had inherited the legacy of championing the rural downtrodden from his father, and has been pursuing it with gusto

ONE of the striking similarities between the second Prime Minister and the sixth is their unwavering commitment towards alleviating poverty among the rural folks, a subject of considerable research by Royal Professor Ungku Aziz in the 1960s.

In seeking a fresh new mandate from the rakyat, Prime Minister Datuk Seri Najib Razak recalled his father’s words: “Your duty to the nation is to fulfil the trust of the people to the best of your ability.”

It is an arduous and challenging responsibility but Tun Abdul Razak Hussein, fondly remembered as Malaysia’s “Father of Development”, had delivered this trust magnificently. This had been attested by foreign scholars.

Dr Colin Barlow, an Australian agricultural economist who used to work at the Rubber Research Institute of Malaya, lauded Tun Razak for his vision in promoting land development schemes and improving smallholdings in Malaysia in the 1960s.

“Tun Abdul Razak was a personal hero of mine,” Barlow told the 18th biennial conference of the Asian Studies Association of Australia at the University of Adelaide in South Australia in 2010. He was “the architect of giving practical application to popular desires”.

“Tun Razak engineered major improvements to rural education and health, along with roads and other infrastructures, proceeding in the 1970s to pioneer wider national transformation through the New Economic Policy,” he said.

One outcome was the establishment of the Federal Land Development Authority (Felda), which was fashioned after difficult beginnings into a highly successful body.

Felda’s success in poverty alleviation in Malaysia was even acknowledged by eminent economist Prof Jeffrey Sachs of Columbia University, a member of Najib’s Global Science and Innovation Advisory Council (GSIAC).

Now the legacy of championing the rural downtrodden has been inherited by Najib, and over the last four years he has been pursuing it with gusto.

From 2010 to this year, a sum of RM18.7 billion was allocated for rural infrastructure development. This year alone, the government has committed to construct 441km of rural and village link roads to benefit 220,000 villagers.

During this year too, an additional 24,000 houses will benefit from water supply and 19,000 houses from electricity supply.

Najib has pledged that “it is the responsibility of the government to change the lives of the people in the rural areas so that we can provide a balanced development for all”.

Recently he introduced the Rural Transformation Programme to ensure that equal emphasis is given to development in the rural areas. A Rural Transformation Centre was set up in Gopeng, Perak and another in Wakaf Che Yeh, Kelantan to provide integrated business services.

Given the opportunity, the following are some of the road infrastructures that he plans to develop in the rural areas in the next five years:

BUILDING a 2,300km Pan Borneo Highway stretching from Sematan, Sarawak to Serudung, Sabah;

EXTENDING the East Coast Highway from Kuala Krai to Kota Baru and Gambang to Segamat;

CONSTRUCTING a West Coast Highway from Banting to Taiping; and,

BUILDING another 6,300km of paved roads in Peninsular Malaysia, 2,500km in Sabah and 2,800km in Sarawak to benefit an estimated 3.3 million people.

Building roads and highways is one sure way of uplifting the socio-economic level of the rural folk and eventually contributing to national prosperity.

A well-known case study is the building of the Interstate Highway System in the United States initiated by Dwight Eisenhower when he became president in 1953.

With a network of 75,000km crisscrossing the entire country, the extensive highway system that was built from the 1950s to the 1970s at a cost of US$300 billion (RM912 billion) had transformed the rural landscape and spawned the mushrooming of new towns and economic activities in areas adjacent to the highways.

There was, however, negative side-effects which we should also take into cognizance such as environmental degradation that invariably accompanies the opening up of rural land and air pollution arising from the increased use of motorcars.

One “Blue Ocean Strategy” that Najib is championing is the implementation of the 21st Century Village concept to spur rural transformation and bring the rural community into the mainstream of development. This is a new initiative under the National Key Result Areas (NKRAs). The first full-fledged project is under way in Tanjung Besar, Kuala Lipis.

“We want the modern way of life brought to rural areas. These efforts should not merely be physical development, but something more comprehensive which will bring 21st century development into rural areas,” Najib said during the launch of the Rimbunan Kaseh smart village in Tanjung Besar last month.

So far, 71 poor families have been relocated to the village, which was jointly developed by the federal and Pahang state government together with IRIS Corporation Bhd.

The Prime Minister’s Department’s Implementation Coordinating Unit oversees the project.

The villagers’ livelihood is sustained with high-tech integrated farming activities, which includes the rearing of tilapia and jade perch fish, golden melon, butterhead lettuce, misai kuching and free-range chicken. These activities are supported by systematic and dynamic marketing methods.

Villagers also enjoy amenities such as a multipurpose hall, surau and ICT centre for children. The 71 settlers, who used to earn below the poverty level, are now earning between RM1,000 and RM1,500 and the Prime Minister hopes that they would be earning more in time to come.

The concept of “smart villages” is one of Najib’s ideas that has earned the endorsement of the GSIAC, a stellar group of 30 world leaders in academia and business that advises him on cutting-edge developments in science, technology and innovation.

The GSIAC Secretariat is jointly manned by the New York Academy of Sciences and the Malaysian Industry-Government Group for High Technology (MIGHT).

Our development record is second to none. In an assessment of the progress made by the developing countries in achieving the Millennium Development Goals, the United Nations Development Programme has acknowledged that Malaysia has accomplished almost all of the eight goals ahead of its target date of 2015, an achievement that has been accomplished by only a few countries.

At the pinnacle of all these successes is the hallmark of a champion of the rakyat — a trait almost embedded in the DNA of our current national leadership.

Why we are lagging behind!

April 14, 2013

by Koon Yew Yin@http://www.themalaysianinsider.com

My objective in writing this is to support Professor Datuk Dr Woo Wing Thye’s lecture on April 12 at the Syuen Hotel, Ipoh. In his lecture he listed 5 root causes for our poor performance in comparison with South Korea and Taiwan.

Woo (left), possibly because of the election fever, tried to be politically correct and made little mention of the New Economic Policy in our failure to keep up with our neighbours. In fact, it is not only Woo who is silent on the NEP; most analysts appear to have sidelined this policy in the election debate to date.

This is a mistake as the real policy culprit explaining our failure to develop as quickly as our neighbours is the New Economic Policy (NEP) and the abuse of power in the BN government’s implementation. As a result, our neighbours are doing much better than us in spite of the fact that they all did not have the natural resources such as oil and gas.

The culture of corruption in this country is systemic and built into the policy framework of the NEP. Over the years, this ethnic-based policy has been abused to benefit only a select group of Bumiputera, although the policy was originally targeted at helping the larger community of poorer Bumiputera.

Despite the government’s strong defence of the NEP and its attempt to demonise those who are critical of it, no less an authoritative source than the government appointed National Economic Advisory Council has admitted that although ethnic-based economic policies have worked by reducing poverty and addressing interethnic economic imbalances, its “implementation has also increasingly and inadvertently raised the cost of doing business due to rent-seeking, patronage and often opaque government procurement,” which “has engendered corruption.”

This analysis is the same as the one that I have been making in my public writings and speeches. In the profession in which I have worked for many years, a system where contractors get jobs because of their ethnicity will invariably breed a culture of ethnic-based cronyism and inefficiency.

For example, IJM Corporation Bhd, of which I was a founder, did most of their highway contracts as sub-contractors to some Bumiputera Concessionaires. Yet IJM could win a few highways toll concessions on open competitive tenders in India. It is ironic for IJM, with a market capitalisation of more than RM7 billion, to work primarily as a sub-contractor in our own country.

The same applies in the procurement policies of PETRONAS. Because of this race-based requirement, contracts and concessions were awarded to Bumiputeras who do not have the expertise to carry out and complete the projects. As a result project costs balloon due to the number of layers of sub-contractors required to complete the job.

The percentage of mark-ups imposed by each layer is, in essence, a leakage in itself. This has created an underground economy of rent-seekers, which the government has finally acknowledged. However, it still refuses to discuss this matter in an open and transparent manner or seek solutions to it.

Hence, it is not surprising that the culture of corruption has become the norm rather than the exception. Malaysians are accustomed to the culture of having to pay a sum of money (or in kind) to complete a certain transaction, whether in business or in other sectors.

Large-scale corruption as mentioned above is rarely caught by the authorities. The Malaysian Anti- Corruption Commission (MACC) prefers to target lower-level corruption and harass opposition members instead of going after the big fishes who enjoy immunity because of their political affiliation with the ruling elite.

It is frustrating for many Malaysians that the BN government has not learnt from the past mistakes and persist in making decisions that bleed the nation of increasingly scarce resources.

Hopefully the Pakatan Rakyat will do better. For them to get the country out if its deep hole, they must recognise that the NEP is a crucial road block in our road map to development that must be redressed immediately.

We cannot become a fully developed nation by even the 22nd century let alone 2020 if the NEP remains the main policy framework , corruption continues on the same scale and if corrupt leaders keep abusing their powers for self-gain.

BRICS challenge the World Bank and the IMF in Development Finance

April 2, 2013

by Bunn Nagara (03-31-13)@http://www.thestar.com.my

A prospective new financial architecture promises to reform and improve development finance for the world.

FIVE countries came together during the week to grab international headlines over how they might, as a group, change the world: Brazil, Russia, India, China and South Africa (BRICS).

And they would do so in the most tried-and-tested way imaginable: financially, as a single economic entity. As a bloc BRICS may effect change on a global scale, but the grouping would still do so in the traditional way of flexing economic muscle.

The annual BRICS summit held during the week in Durban, South Africa, focused on what that muscle can do – challenge the World Bank and the International Monetary Fund in the way development finance is conducted, as well as the Western dominance that has prevailed in both Bretton Woods institutions.

Those institutions were never meant to be that way, of course, as a reading of their founding texts would show. But any initial magnanimity soon gave way to self-interest: US and European dominance of the World Bank and the IMF respectively was to be a Western “consensus” imposed on the world like a global neo-colonial regime.

Interestingly, the original BRIC as both a term and a grouping originated not in any of the initial four countries or the developing world, but in the US itself.

None other than Goldman Sachs’ Asset Management Chairman Jim O’Neill coined the term in 2001 for those countries he believed would outpace the US in total GDP by 2020.

At the turn of the century Brazil, Russia, India and China were merely regarded by some as emerging economies developing under their own steam.

After O’Neill’s coinage they held their first summit in 2009 and invited South Africa to join them a year later, and BRICS was born.

Since then, BRICS as both concept and entity has had vigorous growth and a vibrant youth. It compares favourably with the IMF and the World Bank, both pushing 70 years and weighed down by limiting conditionalities and outmoded economic ideology.

Both institutions typically adopt a cold, mechanistic approach to development that prioritises market interests over human needs. Their Western bias is also a throwback in a 21st-century world of shared global interests and aspirations, and a world in which Western economies themselves are in trouble.

In contrast, BRICS as a bloc of emerging economies serves as a bridge between the developing Third World and the developed First World. It seeks to narrow that yawning chasm by focusing on reviving global growth and ensuring macroeconomic stability.

Those virtues that had once been the preserve of the West have become its elusive goals. The “developed” and the “emerging” (mostly, once “developing”) economies have traded places.

The new global bank that BFICS wants to establish is expected to emphasise infrastructure development and trade. The first represents solid investment in development for the future, and the second works as an economic multiplier for further growth.

On paper, BRICS countries account for almost half the world’s population and just over a quarter of world trade. But more important than these bare figures is how Brics economies have been driving global growth for years, as acknowledged by the World Bank itself.

The idea for a new global bank arose only last year. So how the measured progress at the Durban summit is perceived depends at least as much on the observer: is the glass half-full or half-empty?

Some of the most difficult decisions, such as financing modes, remain unresolved. Its primary purposes like the operation of funds in project financing and a contingency fund as crisis buffer will take more time to work out.

Pessimists may cite how the absence of agreement on even the quantum of fund contribution from each country bodes ill for BRICS. Basing the contribution on economic capacity makes sense, but concerns were expressed over how that would inevitably make a hulking China dominant.

A standard sum of US$10bil (RM31bil) from each country as seed capital was then considered, following a Russian proposal, but the final decision was left until later.

Optimists would say that far from weak indecision, this showed an openness about not wanting any country to dominate, with agreement on equality with a fair and manageable quantum for all.

However, realists may say that in such financial matters China would still eventually dominate. To that, it can be said that dominance by a single country was never a problem before, given the prominent US role and influence in the World Bank and the IMF.

At this point some may say it was precisely because of single-power dominance that had compromised the work of the Bretton Woods institutions. It might then be observed that a new global bank dominated by China would only balance the World Bank (and the IMF), which it would complement rather than replace.

Some observers may see crippling incompatibility in the different political systems within BRICS.But such diversity need not be an obstacle, particularly when all countries now work within a global capitalist system.

President Vladimir Putin, often cited in Western circles as a modern incarnation of the Soviet bear, even insisted that a new global bank “must work on market principles only.” And “communist” China is not only a major and enthusiastic player in global markets, but – to former British foreign minister David Miliband – has even acted as a saviour of Western capitalism.

What worries fans of the IMF and World Bank is not how a new global bank as competitor will “steal their business,” but how it may force both to be more democratic and more sympathetic to the developing world. Who else but those currently dominating them in Washington and Brussels would object?

Japan as an emerging economy itself decades ago had its chance to forge a new alternative in international finance with the Asian Development Bank, but blew it.

The former coloniser in Asia seeking to make good in its post-war period, with US partnership, soon settled into establishment mode alongside its Bretton Woods equivalents. A new global bank established by BRICS will be a welcome addition to the existing financial institutions.

Its continental and political diversity would also make a slide into betraying its noble purpose more difficult.

Late last year, Brazil suggested that the proposed bank should be modelled on ASEAN’s Chiang Mai initiative.This is a time for a sharing of experiences when each can learn from the rest, not of jealous exclusion and unfounded fears of rivalry.

In time, perhaps even the World Bank and the IMF can find it in themselves to accommodate and welcome new financial institutions operating on their “turf”.At least that would help them return to their initial noble calling.

Decentralization for Democracy and Good Governance

April 1, 2013

by Francis Loh@aliran.com

The GE13 is around the corner. Regardless of who takes over Putrajaya, a critical and urgent issue is decentralisation. On account of over-centralisation of our political system, we read and hear of differences and conflicts between the Federal authorities and the state and local governments. Invariably, the rakyat is always the loser.

Federal vs state

For example, there is the problem of water treatment and supply which pits the Selangor state government against SYABAS, the consortium which holds the concession to the water services of Selangor (Kuala Lumpur and Putrajaya). In their wisdom, the federal authorities during the Mahathir era decided to transfer the control of the supply and treatment of water from the state governments throughout the Peninsula to the federal authority.

Ultimately, water services were privatised to concessionaires like SYABAS while the regulation of these concessionaires came under the federal authority.

Not only this, solid waste collection and maintenance, which used to come under the purview of the state authorities was also taken over by the Federal authorities and privatised to three consortiums namely: Env Idaman, Alam Flora Sdn Bhd and Southern Waste Management Sdn Bhd. The Federal government’s Solid Waste Management and Public Cleansing Authority (PPSPA) now acts as the overall regulatory authority. Only the state governments of Penang, Selangor and Perak have resisted this takeover.

In Penang, we continue to hear complaints of how public transport, in particular the licensing and even the routing of buses in George Town, falls under the control of the Commercial Vehicles Licensing Board (CVLB), a federal agency, and that the hands of the Penang state government and the Municipal Councils are tied when it comes to resolving the transportation problems in the state. Apart from widening existing roads and proposing to build new highways (which have incurred the wrath of many Penangites), the Penang government has also launched free bus services (which do not need to be licensed by CVLB) as a stop-gap measure to reduce Penang’s traffic congestion.

Of course, the issue is a political one. Not surprisingly, the Penang Barisan Nasional has taken out full-page advertisements announcing that it would build a monorail system in Penang should it take over the state in the coming elections. Presumably, Federal funds will be forthcoming for such a project, assuming that the BN returns to power in Putrajaya; and assuming that the rakyatdesire such a solution. But what if…?

As well, there is the dispute between the Federal government and the Penang state government over the control and management of the Penang Port. In the latest version of this dispute, the Penang state government has offered to take over control of the ferry services which is currently under the control of Penang Port Sdn Bhd which is a subsidiary of the Penang Port Commission, a federal authority.

In late 2012, it had been announced that the federal cabinet was in advanced negotiations with Seaport Terminal, owned by tycoon Syed Mokhtar Al-Bukhary, to privatise Penang Port to Seaport. The Penang state government called upon the federal cabinet to privatise the Port to the state government instead, apparently to no avail.

Not forgetting, there had also occurred a dispute between the Pakatan-led Kedah state government and Universiti Utara Malaysia, which had not settled quit rent payments for the extensive UUM campus for about a decade.

Apparently, when the Kedah state government was under the BN before 2008, this non-payment had not been an issue. But the rakyat suffered a loss in revenue.

And of course, there is the ongoing dispute between the Pas-led Kelantan state government and the BN federal government over the payment of oil royalties to the state which has now ended in the Courts.

This list could go on and on.The point is that there has been a centralisation of the Malaysian political system during these past 55 years since Independence. Yes, the Executive has assumed greater powers over Parliament and the Judiciary, the other two branches of our government. Yes, the Executive has also penetrated deep into the sinews of our Malaysian society so that many aspects of our everyday lives have come under the control of those in power in Putrajaya.

However, too little attention has been given to how the federal government has also been accumulating and centralising powers at the expense of the state and local governments — to the detriment of our society and economy.

Yet another sector that has fallen under the virtual monopoly of the federal authority (unlike in most under federal countries) is our education system. The Ministry of Education employs an estimated half a million teachers and administrators. In this day and age, can any organisation of such behemoth proportion function efficiently and effectively? Can it ever be world-class? No wonder there are so many complaints and criticisms of our educational system.

Alas, too much criticism might have been focused on how the national-type and mission schools have been marginalised, how teachers are burdened with administrative chores rather than teaching, how the teaching of History and Moral Studies curriculum overemphasises Islamic concerns and the role of Umno leaders while non-UMNO leaders and non-Islamic matters are largely neglected, etc. All these points are true. But perhaps the most important shortcoming of the educational system is its over-centralisation!

We must reverse this process. Decentralisation must be put on the agenda again, whoever takes over Putrajaya. Otherwise, our development goals, democracy and good governance will be compromised.

Global turn towards decentralisation

Previously, in post-colonial societies, the focus of attention of politicians and researchers was on consolidating the centre to enhance national unity, national sovereignty and national development. Not surprisingly, the Centre ended up dominating the states or provinces, regions and local governments. Consequently, these lower levels of administration became dependent on the Centre. In some countries, for expediency, some measure of ‘deconcentration’ of functions, already decided upon by the Centre, was carried out by the lower level authorities, without any transfer of decision making powers to the lower level authorities.

However, since the 1990s, the focus of attention of politicians and researchers has changed. For a process of decentralisation involving a devolution of decision-making powers to lower level authorities has occurred in many countries throughout the globe — from South Africa, Ethiopia, Sudan, Southern Sudan and even in war-torn Iraq, to Mexico, Argentina and Brazil, to India, Pakistan, Indonesia, Philippines, Thailand and even post-conflict Cambodia and Nepal.

Indeed, in neighbouring Thailand, Philippines, Indonesia and Cambodia, great strides have been taken towards decentralisation by introducing new laws to devolve decision-making powers to lower levels of government; reintroducing local government elections; and sharing revenues and resources with the regional and local governments.

This decentralisation process can take various forms. When the power-sharing arrangement between the Centre, regional and local is clarified in the Constitution, we call it a federal system.

Federalism

Federalism is practised in some 25 countries, accounting for 40 per cent of the global population. Among these federal countries are India, Canada, Australia, USA, Brazil, Argentina, Switzerland, Germany, Austria, Nigeria, South Africa, Sudan, South Sudan and Malaysia.

Three major features characterise federalism:

1. The Constitution recognises at least two levels of government. It is not the Centre that empowers the constituent unit (CU).

2. The Constitution also defines the scope of relations between the Centre and the CU; again, this is not determined by the Centre. In this regard, the distribution of financial resources between the Centre and the regional and local governments is a critical consideration. If the CUs are not accorded enough financial resources via revenue collection, fiscal inequality results; and the CU ends up being financially dependent on the Centre — which jeopardises its ability to make decisions at the local level and to provide services.

3. And in disputes between the Centre and CU, it is not the Centre but an independent arbiter – the Judiciary, Constitutional Court, Upper House, etc — that decides.

Invariably, some federalisms are more decentralised ( eg. Canada, Australia, Germany, Switzerland, India after 1990), while others are more centralised (Malaysia and India before 1990). Democratisation and the resultant changing political culture can effect a redefinition of the relationships between the Centre and the CU as in the case of India, which since 1990 has evolved from a centralised to a decentralised federalism.

Why decentralisation?

First, beginning from the 1980s onwards, country after country in the former Soviet Empire, then Latin America and southern Africa, East and Southeast Asia, and most recently in the Middle East, began to democratise. Elected constitutional governments replaced one-person, one-party or military rule.

This phenomenon has been described as the so-called ‘Third Wave of Democratisation’. For example, ordinary citizens in East and Southeast Asia, whom many researchers and political leaders had previously described as seemingly uninterested in politics (because they are Asians, not Westerners — sic) began to stand up. Not only are they interested in elections to determine who should be their political leaders via elections; they are also interested in shaping policies to ensure they are pro-people, not pro-elite. They even monitor those leaders and policies to ensure accountability.

Often, this ‘awakening’ of the people is related to rapid economic growth and the rise of the educated middle-class, and growing awareness among ordinary people of what was happening in the world politically, all these processes hastened by globalisation.

Second, insofar as most countries are multiethnic and/or multireligious, the minority populations in these plural societies also began to stand up. These minority populations were particularly attracted to political decentralisation, especially federalism. An important book entitled Federalism: An Introduction, published by Forum of Federation, an international grouping of federal countries explains that federalism is a mode of governance that seeks to ‘combine self-rule for regions and minority interests’ with ‘shared rule for general and common purposes’.

India, which has practised parliamentary democracy almost uninterruptedly since Independence in1947, and experienced rapid economic growth for about two decades, has emerged as a ‘showcase’ for how the interests of the centre, regions and minority groups can be addressed purposively, without compromising economic development or democracy. As a result of redrawing the boundaries, the sub-continent now comprises 28 states and territories, and recognises 22 official languages (including Hindi and English). Many of these states have been held by Opposition parties, and many affairs of the states, including the educational systems, are conducted in the languages of the regions, apart from English and Hindi.

Contrary to the claims of authoritarian rulers usually associated with the majority groups which dominate the central governments, devolution of powers or granting autonomy for minorities in the regions does not lead to secession. Rather, it is when power is not shared or autonomy denied that minority groups — like the Eritreans in the eastern part of the old Ethiopia; the African Christians in the southern part of Muslim-dominated Sudan; the Tamils in the Jaffna peninsula in Sri Lanka; the Malay-Muslims of Patani in Buddhist-dominated Thailand, or the Moros in southern Philippines dominated by a Catholic majority — resort to secession, often violently.

Third, it is also easier for ordinary citizens to identify with local and state/regional governments than with Central governments located further away. Focus on lower levels of government offered not only more opportunities for participation, but more accountable and responsive governments too. Consequently, local and state/regional government elections have gained prominence and attention.

And fourth, decentralisation also gained ground because it fosters good governance. It is obvious that the state-level, even more so local-level governments, are more aware of local complaints and problems and often more responsive to local needs. Social scientists call this ‘local knowledge’. Hence the planning and delivery of goods and services can also be more easily attuned to local needs. On the other hand, it is difficult to make the central government more accountable and responsive. Not least, they might not be aware, let alone understand local needs. Chances are, the central governments, will also be more easily subjected to elite capture, domination and the cronyism that accompanies such domination.

Principle of ‘subsidiarity’

The above fourth point is consistent with the principle of ‘subsidiarity’ which underscores any notion of good governance. Plainly put, ‘subsidiarity’ is the practice of disallowing the central government from taking over or monopolising a particular task — say, delivering water supply or electricity, running public transportation services or even schools and universities, if the task can be performed efficiently and economically by a lower level of government.

Accordingly, in many mature democracies which believe in decentralisation, these utilities and services are performed by the local municipality or state authority, rather than by the central government. Because decision-making is localised, often involving local politicians, there develops community involvement in planning, monitoring and implementation because the community can identify with the policy and decision-makers. Not surprisingly, the practice of subsidiarity enhances local government elections which allow the community to participate in, if not take possession of the government machinery, at least at the lower levels.

Whither Malaysia’s Federalism?

Unfortunately, Malaysia’s experience has been one towards greater centralisation, contrary to the global decentralisation trend.

Ironically, Malaysia used to be more decentralised than its Southeast and East Asian neighbours. During the 1950s and 1960s, the state and local governments used to have greater autonomy and were involved in a wide range of activities and services including public transport, operating ports, public sanitation, sewerage, water treatment and supply, building low-cost housing, clinics, markets, etc.

Local authority elections were also conducted, from the municipal councils to the town councils down to the local councils in the New Villages. In fact, the holding of elections to these local authorities preceded the introduction of elections at the federal and state levels.

As is well known, a turning point occurred in the mid-1960s when local government elections were suspended and then abolished in the early 1970s. The introduction of the New Economic Policy, which was planned, implemented and monitored by the federal authorities was another turning point. Hence although a decentralisation process set in, in other parts of the globe, the federal government in Malaysia began to centralise more and more powers and functions under its wings to the detriment of the local authorities and state governments.

It is only now, after the 2008 general elections, which saw the Pakatan Rakyat coming to power in five states, that this centralisation process has been questioned. Over these past five years, not only the PR-led governments but also civil society has been pushing for the restoration of local government elections and a restructuring of federal-state elections.

As we approach GE13, listen to what the two coalitions are saying. One of the buzzwords of this election must be decentralisation.Decentralisation ultimately means decreasing the size and scope of activities and budgets of the central government and increasing the size, scope and budgets of local and state governments. The goal is deepening our democracy and moving towards good governance.

Vote the coalition that promises a decentralisation that will restore our democracy and good governance. And make sure that they do what they promise, after GE13. — aliran.com

 

To Dr Chandra Muzaffar from Choo Sing Chye

March 18, 2013

http://www.malaysiakini.com

Once your heart was  filled with egalitarian ideals which copiously propagated into the pages of  your books and Aliran Monthly.  I admired your courage to say these forbidden ideals which in the eyes of the UMNO kingpins were seditious.

I believed that you had the passion then, to offer solace for the poor without fear of offending the BN elites of the day. You didn’t speak for the Opposition, nor the BN government, but you spoke up eloquently for the poor and injustices.

In your heart you felt the anguish, despair, misery and wretchedness of the poor. But today I see a different you.

You have unmistakably  soaked up  the best tradition of the 5th Century Greek Sophist, Thrasymachus where he expounded his theory that “justice is simply whatever is to the interest of the stronger party.” (1)

Today’s reality and challenges are the same as to the day you wrote this book in 1989, Challenges and Choices in Malaysian Politics and Society. Below are some of the quotes from your book which are still as relevant as today’s woes:

“The instability within Barisan parties, the cliques and factions that have emerged in some of them, the fierce and ferocious competition for power among groups and individuals, the buying and selling of votes even in divisional and branch elections, and indeed the foul filth that oozes out of every pore of Barisan Nasional politics…

“Perhaps most of all, it is the growing gap between word and deed, promise and performance that has disenchanted the people.

“One talks all the while of trust and integrity and yet there is no determined, concerted endeavour to unravel the truth about the shameful, scandalous BMF affair.

“One talks all the while of the danger of corruption and money politics and yet corruption through cronyism and the politics of money are allowed to flourish.

“One talks all the while of clean, healthy business practices and yet small but powerful cliques and coteries have entrenched themselves in the world of commerce and industry.

“One talks all the while of thrift and austerity and yet there is lavish spending on prestige projects, tourist complexes, exclusive clubs, expensive mansions, grand celebrations, extravagant ceremonies, and costly trips and travels abroad.

“One talks all the while of how important national unity is and yet one does not cease to divide the people by racialising issues.

“One talks all the while of how liberal the administration is and yet one imposes the severest curbs upon ceramahs and publications.

“One talks all the while of hard work and yet whenever the apostle of hard work visits a state or district everyone stops working!

Crisis of credibility

“It is these blatant contradictions between what is said and what is done which has now led to a serious crisis of credibility. When a government’s credibility is at stake, it must know that it is in trouble. For the crisis of credibility is the stage that precedes the crisis of legitimacy. Once a government faces a crisis of legitimacy, it ceases to command any moral authority. It is a sure sign of its downfall. Needless to say, our government is still some distance away from that stage.

“In this sort of situation, it is quite possible that unscrupulous elements among the ruling elites seeing that both their Malay and non-Malay bases of support have been weakened considerably may in desperation try to create ethnic tensions which may lead to ethnic conflicts. They may then use the resulting ethnic breakdown as an excuse to set aside democratic procedures and rule by decree in order to consolidate and expand their power.

“If this happens, it would be a grave blow to the people’s power. It would be a betrayal of the will of the rakyat. This is why though we may never be able to prevent a formal authoritarian regime from establishing itself, we should not do anything that will make it easier for anyone to impose such rule…”

I believe what you had written then was based on egalitarian idealism that was close to your heart and ours too. Gone are days when you speak like an idealist, and today you speak like a BN politician and write like certain columnists in the mainstream media.

Whatever you write now does not matter to us and the poor any more and perhaps to you now the “foul filth that oozes out of every pore of Barisan Nasional politics,” smells like roses.

Reference:

1.  ‘An introduction to Political Philosophy,’ ARM Murray, published by Cohen and West Ltd, London, 1953.

Embrace Change, not Fear It

March 12, 2013

by Anwar Ibrahim@http://www.malaysiakini.com

COMMENT: The present UMNO-BN government of Najib Abdul Razak isliving on borrowed time. It doesn’t want to admit it but its legitimacy is now totally in question because constitutionally, its full term has expired.

The people’s patience is tested to the limit here by the audacity of a government that goes on ruling without a mandate.

A number of bogus analysts and self-appointed doomsday prophets, especially those driven by very personal agendas, have warned that Malaysia will descend into political and economic chaos in the event of a Pakatan Rakyat victory.

On the other hand, the more genuine and independent observers have expressed greater optimism. For instance, the original ‘Dr Doom’, Prof Roubini, says that our economy will stay robust even with a change in government.

We know that a mandate for change is not limited to the political sphere though it is true that without that mandate, economic management itself will be off to a false start.

When Indonesia made that break from military autocracy to constitutional democracy, much of the focus of the free world was on how its economy would weather the transition. And in their case, transition would stretch for years and indeed the fruits of that initial process of political upheaval are for all to see.

In the case of the Arab Spring, the major worry remains the lack of clearly defined policies that would set the road map to economic recovery and growth. They are still finding their way and it won’t be an easy way but that is no excuse for rejecting freedom and democracy.

Certainly, political stability is a key factor, and I might just emphasise the most crucial factor in setting the direction and objectives of economic management.

False logic

But let me stress that this is not to be confused with the argument that, because political stability is so crucial, therefore there should be no change in government.

This is false logic because the test of political stability is in fact the ability of a nation to experience a change of government peacefully through the ballot box. In this regard, no matter what the UMNO-BN propaganda says, we, the Pakatan Rakyat, believe in this peaceful process and we are confident that the people are matured and ready for this change.

Now, the question that needs to be answered first is what are the likely economic consequences of a peaceful political transition? I think the obvious response is that number one, the status quo may be maintained i.e. nothing exciting, the same policies are intact and no one wants to rock the boat.

The economy may worsen or remain stagnant, or it may improve marginally but lacking in lustre.

Or number two, things could head south i.e. go downhill. The new government has no clue how to run the economy and throws caution to the wind. They try to outdo the previous government’s fiscal irresponsibility and take the country down to even greater depths of deficit.

Or finally, a third scenario is possible: the new government seizes the day and carries out the economic policies and reforms it has laid out in its election manifesto.

If things are done properly and with full commitment to achieve broad-based and sustainable growth, we may well see economic transformation.

This is the road we will take. In other words, a mere change of government will not lead to chaos in the economy. Certain conditions precedent must be met of course.

There must be due democratic process and, to my mind, this is best translated as good governance and the rule of law.

Ending rent seeking

No doubt the question of policy clarity takes precedence. Economic management must be based on sound policies -not knee jerk reactions.There must also be continuity but this is subject to a major caveat: only bona fide, above board undertakings, ventures and enterprises will be continued.

Rent seeking and other crony driven schemes will meet their Maker sooner than later.We know that the Najib administration has been taking our economy down the deficit path. And now, as the elections draw nearer, with the kind of money that would have been doled out we would inherit an economy which would be in even greater deficit.

So, efforts must be geared towards arresting this trend with the longer term objective of finally turning it around. There will be no continuity of the UMNO-BN model which has prevented Malaysia from attaining to higher-income status. What we have lost over the years in terms of “strategic advantage” we must strive to gain back.

We are a nation blessed with resourceful people. We must not allow this to drain away. In this process, it is of the greatest importance that there is good governance.

We can talk till the cows come home or till our faces turn dark blue or pay millions to consultants to come up with dazzling charts and models about transformation but, without good governance, that will just be public relations and empty rhetoric.

Failure in governance would include corruption in high office, lack of transparency in government dealings, and breakdown of accountability. There must be meaningful structural reforms that will change the dynamics of how we want the nation’s economic pie to expand.

Investments in new sectors must be encouraged but allowing this to be monopolised by the elite few is a definite ‘no’.  In other words, we will encourage fair competition and the spreading of the economic pie.

We have nothing against big corporations but the priority is job creation and how these corporations fare in the overall scheme of social justice which indeed will be inseparable from the principles of economic management.

Another crucial area of concern is the balance between state-dominated ventures and private investment. We have enough examples of private ventures particularly those in providing basic utilities which act more like oppressors of the people.

Because they are protected by Putrajaya they are not responsive to the people’s call for better service, let alone for more reasonable rates.

Crucial stage

In the international arena, our competitiveness must surely be another key area of focus for economic management not just in the transition period but for long-term sustainable growth.

The list is indeed long as to what we can do and what we must do at this crucial stage of our nation’s destiny.

Suffice it to say that in these deliberations, we are not just looking at pie charts, numbers and data, important as they are, but at the fundamental issues of governance.

In all these, we must remain steadfast in being guided by the safeguards and best practices of a vibrant constitutional democracy. Economic management is not a game of one-upmanship but a duty of the highest calling to be discharged by those of the highest integrity for the well-being of the nation and the welfare of the people.

---

These remarks were made by Opposition Leader ANWAR IBRAHIM at the opening of the forum titled, ‘Economic Management during Political Transition’ held on March 12, 2013 in Kuala Lumpur.

What a Good Trans-Pacific Partnership Looks Like

March 12, 2013

What a Good Trans-Pacific Partnership (TPP) Looks Like

By Derek Scissors, Ph.D.
March 8, 2013

Abstract

The proposed Trans-Pacific Partnership (TPP) is a major step toward building a free trade area in the Asia–Pacific. For the U.S. to benefit economically, the TPP must be a high-quality agreement that moves market-oriented liberalization forward on multiple fronts. These should include state-owned enterprises, intellectual property, and services liberalization. A sound TPP will also reinforce American political leadership in the Asia–Pacific and around the world, demonstrating that the U.S. will continue to make the decisions necessary to remain fully engaged in the global economy for the cause of open markets. The Heritage Foundation’s Derek Scissors explains what a sound TPP should look like.

Every day, U.S. policymakers are faced with choices that will determine the future of American leadership in Asia. One such set of choices involves the Trans-Pacific Partnership (TPP) currently being negotiated.

The TPP is a set of trade and investment negotiations among the U.S., Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. It is an attempt by these countries to expand the scope of the 2006 Trans-Pacific Strategic Economic Partnership (P-4) beyond the four members of Brunei, Chile, New Zealand, and Singapore. Once finalized, the TPP is intended to remain open to additional parties—eventually becoming the core of a free trade area for the Asia–Pacific.

One of the challenges the TPP faces is preventing the dilution of its original economic goals for the sake of expansion (or any other reason). In order for the U.S. to benefit economically, the TPP must be a high-quality agreement that moves market-oriented liberalization forward on multiple fronts. A sound TPP will also reinforce American political leadership in the Asia–Pacific and around the world, demonstrating that the U.S. will continue to make the decisions necessary to remain fully engaged in the global economy for the cause of open markets.

What constitutes a sound TPP? The diplomatic environment is such that a TPP will shape the global trade agenda for the next decade. Beyond the new standard reached in the U.S.–South Korea free trade agreement (KORUS), the TPP must aim high for new rules on state-owned enterprises, intellectual property, and various services sectors. It should include reduction of American trade barriers and should avoid backsliding—for example, with regard to rules of origin. Because of the precedent that the TPP will set, two steps forward in one part and one step back in another, could eventually haunt the American and world economies.

The TPP is a game-changer, economically and diplomatically. If it fails, the recent “pivot” to Asia will be seen as military in nature and America’s value as a friend or ally would be high only in case of potential conflict. The U.S. should conclude and implement a high-quality agreement as soon as possible.

Elements of a Good TPP

The number of TPP members makes for complexity that will inhibit assessments of quality. The rationalization of national regulations and existing multilateral arrangements by itself is a daunting challenge, all the more so because the countries involved are at multiple stages of development. Ideal outcomes are not feasible, particularly for a group that hopes to expand. The TPP should be judged on the number of clear steps forward, or backward.

The perfect is also the enemy of the good in another sense—a TPP is overdue. Global trade diplomacy, topped by the World Trade Organization’s (WTO) Doha round, has flagged. A good TPP was needed yesterday. The partnership should include Japan among the initial signatories, and the U.S. should facilitate its entry into negotiations. But Japanese accession does not justify further delay.

There are many important elements of a good TPP. Liberalization should be as broad and as quick as possible, including lower non-tariff barriers and fewer restrictions on investment and government procurement. But a good TPP must offer progress in three comparatively new areas:

1. State-owned enterprises must be restricted to a limited number of sectors;
2. Intellectual property, including trade secrets, must be better protected; and
3. There must be major service-sector liberalization, perhaps focusing on financial services.

To achieve real and considerable progress in these areas, the U.S must be prepared to reduce barriers in agriculture, textiles, and maritime services. Further, the U.S. should avoid actions that clash with the goal of liberalization—for instance, managed trade in autos.

State-Owned Enterprises

The TPP should be an effort to restart global liberalization. The alternative is a global economic order in which the state plays a far more prominent role.[1] Very large state-owned enterprises (SOEs), topped by Chinese firms but including firms from most of the major economies, have become leading global actors. That makes explicit and enforceable limits on SOEs indispensable to the TPP’s ultimate success. The two main barriers to effectively controlling SOEs are related—(1) defining them and (2) the enormous variety of subsidies available to them.

A narrow definition of SOEs may permit firms to escape classification due to superficial changes. These can include selling a small amount of stock on a public bourse, or including discrete, “private” ownership by members of its own board or even government officials.[2] Such a definition would negate any SOE restrictions, regardless of their content.

A broad definition is needed in order for an SOE chapter to have any meaning. Such a definition will be based on competition first and ownership second: For instance, SOEs exist wherever governments have a capital stake in a firm and sharply or repeatedly suppress competition on the behalf of that firm, by any means. This will include multiple entities in the U.S. The growing role of, and threat from, SOEs makes the gain for the U.S. from a broad definition far larger than the costs.[3] American policymakers must realize this trade-off, and overrule internal political objections to a broad definition.

Given a broad definition, it will be far more effective to restrict the presence of SOEs than to restrict the assistance they receive. That is, SOEs should be barred from most industries. Requiring that they simply operate on a more commercial basis will not work. Some governments will claim that they already operate on a commercial basis for extended periods, but this is entirely insufficient. A firm that would have failed a year ago—but was rescued by the government—cannot truly be operating on a commercial basis now since, on a commercial basis, it would no longer be operating at all.

Governments have developed too many means of support for SOEs, featuring a range of financial subsidies not currently bound by the WTO and regulatory exemptions from competition, sometimes justified by vague reference to national security in connection with a “strategic” industry.[4] Identifying these channels for a particular set of countries at a particular time begs for governments to work to circumvent prohibitions, for example, by selectively offering benefits to domestic private players. A prolonged game of cat and mouse, not a substantial rollback of SOEs, will ensue.

Second and more important, the very existence of SOEs should be understood as an effort by governments to limit market competition and increase state control in a particular sector. That is: an effort precisely to retain sector participants which do not operate on a commercial basis. The goal should not be to pretend to commercialize SOEs in opposition to the reason for their existence, but to permit their operation in a minimal number of areas. SOEs should be banned from most sectors of the economy.

Where TPP member states insist on retaining SOEs, their market share should be capped at as low a level as possible, to forestall absurd claims that state firms completely dominate markets due to competitive superiority. This can be done on an annual basis. SOEs should set revenue targets based on total sector revenue from the previous year. Exceeding these revenue targets by a given amount, say 5 percent, would permit legal retaliation from countries whose firms operate in the sector.

Because SOEs represent circumscribed competition at home, their investments overseas can properly be considered by host countries as different from investment by companies that earn commercial profits at home. In turn, though, host countries should not be able to simply bar SOEs or extort concessions in return for market access, but should commit to a clear set of treatment guidelines.[5]

Intellectual Property

Voluntary trade is mutually beneficial—otherwise one side would decline to participate—and following comparative advantage maximizes this mutual benefit. At the national level, the main American comparative advantage is in innovation, both in terms of how the economic system works and in terms of the resources devoted. Violations of intellectual property (IP) cut at the heart of this comparative advantage, reducing trade benefits for the U.S. and eroding public support. It is therefore quite right for American negotiators to place IP at the center of international economic discussions. Protecting IP will also benefit other TPP members, both now and in the future.

IP is a far-ranging issue even with a group at a similar level of development; with the TPP, the countries involved offer very different challenges in protecting IP. There is no chance the IP issues with all these countries can actually be resolved; a reasonable goal is current improvement and conditions for future improvement. A “TRIPS+” approach—expanding the WTO’s “Trade-Related Aspects of Intellectual Property Rights” framework—is appropriate in principle. Such an approach was employed in the KORUS agreement,[6] but the variation among TPP countries means that priorities within TRIPS+ will have to be set, since not all members are capable of all expansions of TRIPS.

When determining priorities, the U.S. should avoid three past mistakes: (1) insisting on criminal punishments for violators that are never enforced; (2) focusing on specific sectors; and (3) believing partners will come to accept the need for IP protection within a fairly short time.[7]

It could be decades before some TPP members, and prospective members, see self-interest in protecting IP that belongs to foreigners. As long as specializing in innovation is not viable, as is true in most of the world, stealing will remain an attractive alternative. The response, though, is not to prioritize criminal punishments everywhere. The rule of law is stronger in some places, such as Singapore, than in others, such as Vietnam. In addition, an emphasis on pharmaceuticals or another sector is likely to prove shortsighted as IP issues shift across sectors and the TPP draws new members.[8]

A good point of emphasis within IP is trade secrets. Many governments, including some TPP members, may be genuinely unable in the near term to enforce IP protection across the whole of society. With trade secrets, though, governments themselves are involved.

Traditionally, theft of trade secrets has meant that IP shared with governments by foreign firms for legal and regulatory reasons is not being protected. This is often connected to SOEs. Some governments reveal trade secrets to enable their own enterprises to compete with multinational corporations; others practice coercive technology transfer.[9] Strong rules limiting government prerogatives with regard to sharing trade secrets and providing compensation when these are lost are more feasibly crafted and enforced than broad IP statutes meant to apply to all.

Further, such obligations could serve as the foundation for an accord concerning the new way governments suborn theft of trade secrets: cyber-espionage. A February 2013 initiative in trade secrets protection from the U.S., inspired by aggressive Chinese behavior, provides initial steps only,[10] inadequate for discouraging predatory behavior. To shape an effective global response, the TPP must do more. One possibility is to treat theft of trade secrets as equivalent to government-imposed illegal trade barriers and permit responses along the lines of WTO cross-retaliation.[11] This would discourage cyber-theft while legalizing and controlling the inevitable retaliation.

Services

Services share several features with intellectual property. Both are areas of American comparative advantage that need to be pressed in the TPP, and then elsewhere, on partners that sometimes want to accord them secondary consideration. Both are also broad in scope. With services, since American comparative advantage will shift over time and this is a newer area of liberalization than goods, there is more than one path to follow that will bring intense benefits. Precedent here is more important than the specific steps.

One route that recent negotiations have taken is expanding the use of negative lists. A negative list specifies the sectors protected from changes, creating a presumption of liberalization. (Its opposite, a positive list, specifies only the areas to which liberalization applies.) In many agreements, a negative list has been applied to services investment—services provided entirely within a country by a subsidiary established there through investment by a foreign entity. Services trade, by contrast, is buying and selling across national borders by independent entities based in different countries. The TPP should apply a short negative list to services trade as well.

Second in priority to use of a negative list is identifying particular areas for enhanced liberalization. An obvious first choice for the U.S. is financial services. These are not treated separately in the original P-4 agreement,[12] but are a mainstay of the American economy. To varying degrees, greater openness in financial sectors will benefit all TPP members. While the extent of liberalization in particular areas of finance will be controversial, the specific results will be less important to long-term U.S. interests than the precedent of including substantial financial services liberalization as part of TPP, as this will be the basis for any expansion of TPP and future agreements with other parties.

American Offers

One argument the U.S. has often made, correctly, to its trade partners is that liberalization is not a concession. Liberalization benefits the implementing country. Independent research has demonstrated again and again that the bulk of the gains from international economic agreements do not stem from greater access to overseas markets, as is commonly argued when approval of the deals is sought. Rather, most gains stem from increased openness and competition at home.[13]

This does not only apply to America’s partners, of course. Because the American market is largely open already, the areas where it remains closed stand out. In particular, the U.S. has comparative advantages in agriculture and services, yet retains protectionist policies in both areas. Combining efficiency and scale, U.S. agriculture is by far the world’s leader. Farmers and the country as a whole would benefit greatly from open global markets.

Yet the U.S. gives its trade partners reason to remain closed by selectively protecting its own market.[14] Just as valuable precedents will be set through the inclusion of financial services in TPP liberalization, the U.S. should reduce tariffs and other barriers—to foreign sugar and dairy, especially. Liberalization in these areas does not have to be completed within the TPP, but it is long past time for it to begin.

Agriculture is the main area for self-defeating American protectionism, but maritime services may see the single most self-defeating U.S. policy. The Merchant Marine Act of 1920 (the Jones Act) requires all goods transported by water between American ports be carried in U.S.-flagged and U.S.-built ships, 75 percent owned and manned by U.S. citizens. It is a restriction of competition that benefits the American shipping industry and costs American consumers, especially as domestic natural gas production soars. It also justifies services markets restrictions by other countries, harming a huge range of U.S. services companies.[15]

Another area of longtime American recalcitrance is textiles. Here, the U.S. is not fighting the last war, it is fighting a war from the 19th century. Textile and apparel imports benefit consumers, especially poorer consumers who are more vulnerable to price increases for these goods.[16]

Moreover, the jobs supported by imports far outweigh remaining production jobs. Textile and apparel production employed about 384,000 people in the U.S. at the end of 2012. American imports of Chinese apparel alone help support close to that number of jobs in offloading, transport, and retail.[17] Apparel imports from China are less than half the total. Liberalization in textiles would help the U.S. while offering considerable benefits to current and prospective future TPP members.

Pitfalls the U.S. Should Avoid

There are also things the U.S. should not do. Rules of origin are a double-edged sword in a multilateral arrangement like the TPP. Unless rules of origin are rationalized among participating countries, companies often ignore the opportunities offered by new trade agreements because complying with the new rules of origin is too complicated.[18] Rationalizing rules of origin is a core element of any successful trade agreement.

What must not occur is the tightening of the rules of origin as the free trade net is cast wider. This would not be trade creation and liberalization, it would be trade diversion and exclusion.[19] It would change the TPP from a group that can be easily expanded and is intended in part to restart global trade progress to a group that hastens the formation of dangerous blocs.

The same caution applies to labor and environment provisions. There is nothing wrong with mutually agreed-upon labor and environment provisions unless they introduce restrictions on trade and investment. These kinds of restriction are inevitably used as precedents to attack open markets.[20] A broad scope for the TPP will be beneficial as long as the chapters on the newly introduced topics do not clash with the goal of liberalization.

Finally, the U.S. should minimize exclusions, such as those granted in KORUS for rice on the Korean side and, essentially, managed trade for autos on the American side.[21] The TPP should be an opportunity to move forward, not backward. In general, as few items as possible should be exempted through these mechanisms or inclusion on negative lists.

Timing

A sound TPP would greatly benefit the U.S. and its partners. The faster it is in place, the sooner the gains would be realized—gains that are especially needed now with chronically weak American and global economies. And there are still more reasons to speed up the TPP process.

The WTO Doha round is all but dead. The U.S. chiefly blames India and China,[22] although the recent American contribution is also suspect. If Indian and Chinese recalcitrance is indeed the major barrier to global liberalization, the TPP is the best available tool to induce cooperation from them. The same is true for Japan, an ally of the U.S. but one that has struggled with trade liberalization. Japanese participation in the TPP should be welcome, when Tokyo can move quickly. If it cannot do so at the moment, then a finished, functioning TPP may speed Japanese action.

For its part, American trade policy has bordered on stagnant for six years. If KORUS had been ratified in late 2007, upon completion, it might have been possible to make considerable progress on the then-embryonic TPP in 2008. Had the Obama Administration not been critical of imports early on,[23] it might have been possible to make more progress on the TPP in 2010. Instead, the U.S. economy has suffered from restrictions on competition here and overseas. Global trade has become effectively less liberal, as other players created regional accords of often dubious quality.[24] A TPP failure risks not only more lost benefits, but the continuing erosion of the U.S.-built post-war economic system.

High Stakes

There are two different ways the TPP process can fail: (1) no agreement or (2) a bad agreement. The first has unpleasant political implications; the second has unpleasant economic implications.

On the economic side, the inclusion of Canada and Mexico makes the TPP a heavyweight. The two countries accounted for 29 percent of American trade in 2012. Singapore and Australia add a few more percentage points. If TPP candidates Japan and Korea are added, the share passes 40 percent of U.S. trade.[25] Even these numbers do not tell the full story, however.

With the new U.S.–EU free trade initiative, the TPP is no longer the only game in town. But it is difficult to imagine a failed or empty TPP being followed by a powerhouse U.S.–EU accord. The political environment for both will be challenging. If the American side is not willing to move forward on genuine liberalization with TPP partners, there is little reason to believe it will do so with the EU. The TPP’s share of American trade may be 30 percent to 40 percent, but it likely represents the whole of American trade policy in terms of whether valuable progress will be made in the next few years. The stagnation at the WTO and in genuine trade liberalization more broadly puts a heavy burden on the TPP to be a strong agreement, not any agreement.

The TPP also affects American leadership. Respective shares of world trade show China making strides in bolstering its claim to economic parity with the U.S. Asserting American leadership in this context requires a powerful response, starting with a sound TPP.

Absent a high-quality TPP, trade development in Asia will be governed by the Regional Comprehensive Economic Partnership (RCEP). RCEP is to be composed of the Association of Southeast Asian Nations (ASEAN) and its current free trade agreement partners—Australia, China, India, Japan, New Zealand, and South Korea.

In terms of economic benefits, the RCEP should be no match for a successful TPP. Like all of ASEAN’s FTAs, the agreement is likely to be far less liberalizing—focused primarily on goods and offering multiple exclusions and differential treatment. Some RCEP countries, such as Thailand, are natural candidates for the TPP in the future. However, a failed or vacuous TPP leaves even the limited RCEP as the only active vehicle for trade and investment liberalization in Asia—and the U.S. on the outside looking in.[26] (The U.S. is not a candidate for the RCEP as it has no FTA with ASEAN and is not likely to have one in the foreseeable future.)

Finally, if the TPP fails outright, the recent American “pivot” to Asia will be seen as purely military in nature. America’s value as a friend and ally would be high only in case of potential conflict, a somewhat self-defeating position. Along these lines, a TPP collapse would allow China to portray itself as leading when it comes to progress in the Asia–Pacific and indicate that the U.S. only leads when the situation deteriorates.

A Good Trans-Pacific Partnership

In order to achieve a sound TPP, the U.S. should:

1. Restrict the operating space of SOEs to specified sectors and cap their market shares there. Trying to govern SOE behavior will not work.
2. Seek to bind governments, rather than entire societies, when it comes to IP. Coercive government acquisition of trade secrets should be subject to legal, structured retaliation.
3. Insist on a negative list approach in services trade. At least one major financial sub-sector should be included in the areas of fresh liberalization.
4. Take clear steps to address the most egregious American trade protections. Dairy and sugar are obvious choices, but textiles and maritime services should also be opened.
5. Conclude and implement a high-quality agreement as quickly as possible. At this point, speed is more important, and the extent of true liberalization far more important, than the number of initial signatories.
6. Keep rules of origin at least as loose as in the KORUS agreement.
7. Minimize the number of exceptional areas, such as autos.

• The TPP must be a high-quality agreement and it is already overdue. A TPP with little economic value-added will harm American interests indefinitely. A sound TPP will strengthen the U.S. economy and ensure American economic and political leadership in Asia into the future. —Derek Scissors, PhD, is Senior Research Fellow in Asia Economic Policy in the Asian Studies Center at The Heritage Foundation.

[1] Wojciech Ostrowski, “State Capitalism: An Emerging Regime,” Polinares Working Paper No. 51, December 2012, http://www.polinares.eu/docs/d4-1/polinares_wp4_chapter1.pdf (accessed March 4, 2013).

[2] Organization for Economic Co-operation and Development (OECD), “Ownership Structures in MENA Countries: Listed Companies, State-Owned, Family Enterprises and Some Policy Implications,” September 13, 2005, pp. 3 and 16, http://www.oecd.org/mena/investment/35402110.pdf (accessed March 4, 2013); Aldo Musacchio and Sergio G. Lazzarini, “Leviathan in Business: Varieties of State Capitalism and their Implications for Economic Performance,” Harvard Business School Working Paper No. 12-108, June 4, 2012, http://www.hbs.edu/faculty/Publication%20Files/12-108.pdf (accessed March 4, 2013); and OECD, “Corporate Governance of State-Owned Enterprises: Change and Reform in OECD Countries since 2005,” September 14, 2011, https://www1.oecd.org/corporate/corporateaffairs/corporategovernanceofstate-ownedenterprises/48512721.pdf (accessed February 10, 2013).

[3] Xi Li, Xuewen Liu, and Yong Wang, “A Model of China’s State Capitalism,” Federal Reserve Bank of Dallas, May 16, 2012, http://www.dallasfed.org/assets/documents/institute/events/2012/linkages_yang1.pdf (accessed March 4, 2013).

[4] Derek Scissors, “The Most Important Chinese Trade Barriers,” Heritage Foundation Testimony, July 20, 2012, http://www.heritage.org/research/testimony/2012/07/the-most-important-chinese-trade-barriers.

[5] Investment Canada Act, “Guidelines–Investment by State-Owned Enterprises–Net Benefit Assessment,” Industry Canada, http://www.ic.gc.ca/eic/site/ica-lic.nsf/eng/lk00064.html#p2 (accessed March 4, 2013), and Matthew Rennie and Fiona Lindsay, “Competitive Neutrality and State-Owned Enterprises in Australia: Review of Practices and Their Relevance for Other Countries,” OECD, August 2011, http://www.oecd.org/daf/corporateaffairs/corporategovernanceofstate-ownedenterprises/48510172.pdf (accessed February 8, 2013).

[6] Office of the United States Trade Representative, “Intellectual Property Rights in the U.S.–South Korea Trade Agreement,” http://www.ustr.gov/uskoreaFTA/IPR (accessed March 4, 2013).

[7] Peter K. Yu, “The U.S.–China Dispute Over TRIPS Enforcement,” Drake University Law School, October 2010, p. 3, http://www.law.drake.edu/academics/ip/docs/ipResearch-op5.pdf (accessed March 4, 2013); Vinod Aggarwal, “Reluctance to Lead: U.S. Trade Policy in Flux,” Business and Politics, Vol. 11, No. 3 (2009), p. 3, http://basc.berkeley.edu/pdf/articles/Relutance%20to%20Lead%20US%20Trade%20Policy%20in%20Flux.pdf (accessed March 4, 2013); and Minxin Pei, “Intellectual Property Rights: A Survey of the Major Issues,” Asia Business Council, September 2005, p. 6, http://www.asiabusinesscouncil.org/docs/IntellectualPropertyRights.pdf (accessed March 4, 2013).

[8] Ian F. Fergusson and Bruce Vaughn, “The Trans-Pacific Partnership Agreement,” Congressional Research Service, January 10, 2011, http://assets.opencrs.com/rpts/R40502_20110110.pdf (accessed March 4, 2013).

[9] 2011 U.S. Intellectual Property Enforcement Coordinator, “Annual Report on Intellectual Property Enforcement,” The White House, March 2012, http://www.whitehouse.gov/sites/default/files/omb/IPEC/ipec_annual_report_mar2012.pdf (accessed March 4, 2013).

[10] “Administration Strategy on Mitigating the Theft of U.S. Trade Secrets,” The White House, February 2013, http://www.whitehouse.gov//sites/default/files/omb/IPEC/admin_strategy_on_mitigating_the_theft_of_u.s._trade_secrets.pdf (accessed March 4, 2013).

[11] International Chamber of Commerce, “Cross-Retaliation Under the WTO Dispute Settlement Mechanism Involving TRIPS Provisions,” June 29, 2012, http://www.wto.org/english/forums_e/ngo_e/cross_retaliation_2012_e.pdf (accessed March 4, 2013).

[12] Trans-Pacific Strategic Economic Partnership Agreement, Main Agreement, pp. 11–19, http://www.mfat.govt.nz/downloads/trade-agreement/transpacific/main-agreement.pdf (accessed March 4, 2013).

[13] Antoine Bouet, “The Expected Benefits of Trade Liberalization for World Income and Development: Opening the ‘Black Box’ of Global Trade Modeling,” International Food Policy Research Institute Food Policy Review No. 8, 2008, http://www.ifpri.org/sites/default/files/publications/pv08.pdf (accessed March 4, 2013), and Gregory Corcos, Massimo Del Gatto, Giordano Mion, and Gianmarco I. P. Ottaviano, “Productivity and Firm Selection: Quantifying the ‘New’ Gains from Trade,” Intangible Assets and Regional Economic Growth Working Paper No. 05/14, March 2009, http://www.iareg.org/fileadmin/iareg/media/papers/wp5-14_Corcos_Del_Gatto_Mion_Ottaviano.pdf (accessed March 4, 2013).

[14] Chris Edwards, “Agricultural Regulations and Trade Barriers,” CATO Institute, June 2009, http://www.downsizinggovernment.org/agriculture/regulations-and-trade-barriers (accessed March 4, 2013).

[15] Merchant Marine Act of 1920, 46 U.S. Code § 27, 2002, p. 6, http://www.upa.pdx.edu/IMS/currentprojects/TAHv3/Content/PDFs/Jones_Act_1920.pdf (accessed March 4, 2013), and Terry Miller and James Jay Carafano, “Lets Pull the Plug on the Jones Act,” Heritage Foundation Commentary, July 3, 2010, http://www.heritage.org/research/commentary/2010/07/lets-pull-the-plug-on-the-jones-act.

[16] Christian Broda and John Romalis, “Inequality and Prices: Does China Benefit the Poor in America?” Banco de Portugal, March 10, 2008, p. 2, http://www.bportugal.pt/en-US/EstudosEconomicos/Conferencias/Documents/2008MonetaryPolicy/John_Romalis.pdf (accessed March 4, 2013).

[17] Bureau of Labor Statistics, “Current Employment Statistics–CES (National), 2012, http://www.bls.gov/web/empsit/ceseeb1a.htm (accessed March 4, 2013), and Derek Scissors, Charlotte Espinoza, and Terry Miller, “Trade Freedom: How Imports Support U.S. Jobs,” Heritage Foundation Backgrounder No. 2725, September 12, 2012, http://www.heritage.org/research/reports/2012/09/trade-freedom-how-imports-support-us-jobs (accessed March 4, 2013).

[18] Paul Brenton, “Notes on Rules of Origin with Implications for Regional Integration on Southeast Asia,” PECC Trade Forum, April 22–23, 2003, http://www.pecc.org/publications/papers/trade-papers/4_ROO/2-brenton.pdf (accessed March 4, 2013); Masahiro Kawai and Ganeshan Wignaraja, “The Asian ‘Noodle Bowl’: Is It Serious for Business?” Asian Development Bank Institute Working Paper No. 136, April 2009, http://www.adbi.org/files/2009.04.14.wp136.asian.noodle.bowl.serious.business.pdf (accessed March 4, 2013); and Carolyn L. Evans, “Bilateralism, Multilateralism, and Trade Rules,” Federal Reserve Bank of San Francisco Economic Letter, January 9, 2012, http://www.frbsf.org/publications/economics/letter/2012/el2012-01.html (accessed March 4, 2013).

[19] “Rules of Origin, Communication from Hong Kong,” GATT Negotiating Group on Non-Tariff Measures, September 15, 1989, http://www.wto.org/gatt_docs/English/SULPDF/92080053.pdf (accessed March 4, 2013).

[20] Byron Dorgan and Sherrod Brown, “How Free Trade Hurts,” The Washington Post, December 23, 2006, http://www.washingtonpost.com/wp-dyn/content/article/2006/12/22/AR2006122201020.html (accessed March 4, 2013).

[21] William H. Cooper et al., “The Proposed U.S.–South Korea Free Trade Agreement (KORUS FTA): Provisions and Implications,” Congressional Research Service, August 9, 2011, http://fpc.state.gov/documents/organization/171373.pdf (accessed March 4, 2013).

[22] Faizel Ismali, “Is the Doha Round Dead? What Is the Way Forward?” University of Manchester Brooks World Poverty Institute Working Paper No. 167, May 2012, http://www.bwpi.manchester.ac.uk/resources/Working-Papers/bwpi-wp-16712.pdf (accessed March 4, 2013), and Alan Beattie, “Negotiators Sift Debris,” Financial Times, July 29, 2008, http://www.ft.com/intl/cms/s/0/dde1e23a-5da0-11dd-8129-000077b07658.html (accessed March 4, 2013).

[23] News release, “Obama Administration Strengthens Enforcement of U.S. Trade Laws in Support of President’s National Export Initiative,” United States Department of Commerce, August 26, 2010, http://www.commerce.gov/news/press-releases/2010/08/26/obama-administration-strengthens-enforcement-us-trade-laws-support-pr (accessed March 4, 2013).

[24] Julia Gray, “Politics and Patronage: The Function of Dysfunctional Regional Trade Agreements,” Princeton University, April 23, 2010, http://www.princeton.edu/~pcglobal/conferences/ptas/Gray_pta_paper.pdf (accessed March 4, 2013); Pascal Mossay and Takatoshi Tabuchi, “Preferential Trade Agreements Harm Third Countries,” University of Reading and University of Tokyo, September 14, 2012, http://ideas.repec.org/p/cor/louvco/2012035.html (accessed March 4, 2013); and Australian Government, “Bilateral and Regional Trade Agreements,” Productivity Commission Research Report, November 2010, http://www.pc.gov.au/__data/assets/pdf_file/0010/104203/trade-agreements-report.pdf (accessed March 4, 2013).

[25] United States Census Bureau, “Top Trading Partners–Total Trade, Exports, Imports, Year-to-Date December 2012,” http://www.census.gov/foreign-trade/statistics/highlights/top/top1212yr.html (accessed March 4, 2013).

[26] Sanchita Basu Das, “RCEP and TPP: Comparisons and Concerns,” Institute of Southeast Asian Studies, January 7, 2013, http://www.iseas.edu.sg/documents/publication/ISEAS%20Perspective%202013_2.pdf (accessed March 4, 2013).

http://www.heritage.org/research/reports/2013/03/what-a-good-trans-pacific-partnership-looks-like

MALAYSIA: IMF Staff Report for 2012

March 12, 2013

MALAYSIA

Staff Report for the 2012 for the ARTICLE IV CONSULTATION

KEY ISSUES

Near-term outlook

Along with a handful of neighboring countries, Malaysia has bucked global trends and posted strong growth in 2012, supported by domestic demand. In the face of weak external demand, this has led to a significant moderation in the current account surplus.

Growth is expected to remain robust in the near term, fueled by resilient domestic demand and a modest uptick in exports.  Inflation should remain restrained. Risks to the outlook are mainly external and tilted to the downside.

General elections, which must be held by June 2013, may add to short-term market volatility. Macroeconomic policies are well calibrated to the current conjuncture, and monetary policy has ample room to respond in a downside scenario. The economy’s external rebalancing is expected tocontinue over the medium term.

Safeguarding financial stability

he 2012 FSAP found that the Malaysian financial system is sound and supported by a strong regulatory and supervisory framework. Risks to financial stability from high household debt or, potentially, from capital flow volatility, should continue to be monitored closely, but are contained by high bank capital buffers, ample international reserves, and sound monetary and financial policies.

Strengthening fiscal sustainability

Malaysia must regain the fiscal space it lost after the global financial crisis. Staff welcomes the authorities’ commitment to medium term fiscal consolidation, which should be underpinned by a concrete and comprehensive plan.

Consolidation must be accompanied by structural reforms to improve the efficiency and equity of fiscal policy: the revenue base must be broadened and diversified away from energy related receipts; universal fuel subsidies must be gradually replaced by targeted social transfers; and public financial management must be strengthened to better deal with risks associated with growing federal government contingent liabilities.

Promoting higher and more inclusive growth

Malaysia’s record of economic development since independence has been impressive. Achieving the authorities’ goal of turning Malaysia into a high income nation by 2020 will require sustained implementation of the wide ranging structural reforms they have identified to boost investment and productivity. The authorities are also committed to enhancing social protection.

A new minimum wage policy has taken effect from January 2013, and other reforms to strengthen social safety nets are being considered. Together, these reforms will help boost growth, support the ongoing rebalancing, and promote inclusiveness.

http://www.imf.org/external/pubs/ft/scr/2013/cr1351.pdf

January 28, 2013

Wawancara Bersama Dr. Bakri Musa (Bahagian 8)

March 11, 2013

http://suaris.wordpress.com

Wawancara Bersama Dr. Bakri Musa (Bahagian 8): Pendidikan untuk Malaysia

Suaris: Dr banyak menulis dan membentangkan kertas kerja mengenai pendidikan yang sebaiknya untuk Malaysia. Adakah dasar dan sistem hari ini mampu membawa orang Melayu mengharungi gelombang masa depan? Apakah yang perlu diperbaiki, diatasi atau diganti?

Dr Bakri: Ternyata dasar dan sistem pendidikan sekarang tidak mampu membawa anak-anak, khasnya anak Melayu, menghadapi masa depan. Rakyat tidak puas hati walaupun berkali-kali kerajaan buat kertas putih dan cetak biru (“blueprint”) untuk “mentransformasikan” sekolah dan universiti kita. Semuanya tidak berkesan. Di sini saya maksudkan aliran awam; pihak swasta cemerlang, tetapi tidak ramai penuntut Melayu di antaranya.

Tanda jelas pendidikan awam kita tidak mengagumkan ialah pertumbuhan cergas sekolah antarabangsa dan kolej serta universiti swasta. Di Alberta, Canada, sekolah dan universiti awam mereka handal. Oleh sebab itu saluran pendidikan swasta tidak laku. Begitu juga di Singapura. Pertumbuhan sekolah dan universiti swasta yang rancak di Malaysia bukan tanda sektor pendidikan kita beres dan subur, tetapi sebaliknya.

Pramoedya Ananta Toer menulis dalam novelnya Bumi Manusia, “seorang terpelajar harus sudah berbuat adil sejak dalam fikiran apalagi dalam perbuatan.” Itulah tujuan pelajaran, untuk mendidik rakyat yang adil. Pendidikan Islam bertujuan membina makhluk yang soleh. Istilah “soleh” saya ertikan “berguna atau memberi manfaat kepada masyarakat.” Rakyat yang adil dan soleh, itu tujuan pendidikan.

Bagi masyarakat berbagai kaum dan budaya seperti Malaysia, saya tambah atau beratkan satu lagi tujuan, iaitu meningkatkan persefahaman antara kaum supaya kita lebih berfikir sebagai satu dan tidak lagi terikat kepada prasangka kaum kita. Tanpa tujuan ini, kita mungkin menjadi saperti penduduk Northern Ireland, berpendidikan tinggi tetapi bermusuhan antara satu dengan lain. Di sana kaum Katholik dan Protestan tidak habis-habis bermusuhan.

Betul pada intinya seorang yang “adil dan soleh” tidak akan membuat demikian, jadi tujuan kedua ini mungkin berulang atau termasuk dalam kandungan “adil dan soleh.” Walaubagaimanapun kita mesti beratkan sudut ini.

Falsafah pendidikan mesti menyifatkan murid sebagai pisau untuk diasah atau tajamkan. Tetapi sekarang kita sifatkan mereka sebagai tong kosong yang mesti disumbat dengan fakta, maklumat, dan propoganda.

Fikirkan, di tangan pakar bedah, pisau tajam ialah alat memyembuh barah; di tangan ahli seni pahat, (untuk) mereka patung kayu yang indah. Sebaliknya, di tangan penyangak pisau menjadi senjata membunuh. Itu mustahaknya tujuan adil dan soleh dalam pendidikan.

Dengan tong yang diisi, apa yang mungkin kita dapatkan balik hanya apa yang telah disumbat. Itu sahaja! Itu pun bukan semuanya sebab banyak yang terlekat atau bocor keluar di bawah.

Munshi Abdullah menulis, di antara mereka yang berguru dan mereka yang meniru, jauh bezanya. Seorang yang berguru, dan berguru cemerlang, tidak terhad pencapaiannya. Mereka yang pandai meniru terhad hanya kepada menghafizkan apa yang diberi atau diajar. Itu sahaja, seumpama burung nuri.

Pendidikan tidak menjamin kita semua menjadi pemimpin, hanya mengajar pemimpin mana yang patut diikuti (education can’t make us all leaders, but it can teach us which leader to follow). Itu (yang disebut) Horace Mann, pendidik Amerika terkemuka. Dia menambah, tidak ada ciptaan insan yang lebih hebat lagi untuk menyamakan keadaan manusia (education … beyond all other devices of human origin, is a great equalizer of the conditions of men ..)

Di dunia ini, yang paling bertuah atau beruntung ialah mereka yang fasih dalam dua (atau lebih) bahasa, dan satu daripadanya ialah Bahasa Inggeris (BI). Itu sebabnya Negara China, Jepun dan Korea Selatan berlumba mengajar penuntut mereka BI. Yang paling rugi atau lemah ialah mereka yang hanya tahu satu bahasa sahaja, dan bahasa itu lain daripada BI. (manakala berada) di tengah-tengah terletak mereka yang fasih hanya dalam BI. Mengapa BI dan bukan Mandarin atau Swahili yang penting dalam dunia sekarang saya tidak tahu. Sepatutnya Mandarin sebab bahasa itu yang paling ramai pengunanya. Pada satu masa dahulu, bahasa Latin. Mungkin pada masa depan dengan kehandalan kemajuan negara China, Mandarin akan menjadi bahasa pilihan.

Kebanyakan orang Melayu fasih hanya dalam satu bahasa sahaja, dan bahasa itu bukan BI. Kaum bukan Melayu di Malaysia fasih dalam dua atau tiga bahasa: BI, BM(Bahasa Malaysia) dan bahasa ibunda. Itu sebabnya mereka maju, dan bukan atas alasan keistemewaan budaya atau bangsa mereka. Cina yang fasih dengan Hakka atau Hokkien sahaja terhad ke pasar minggu dan gerai atau kedai. Dengan cara pendidikan yang bijak, murid Melayu pun boleh juga fasih dalam tiga bahasa, BI, BM, dan Bahasa Arab.

Mengikut kajian neuroscience, banyak tambahan keistimewaan otak kepada mereka yang fasih dalam berbagai bahasa, antaranya kebolehan berfikir “luar kotak” dan dari berbagai sudut. Itu sebabnya universiti terkemuka Amerika memestikan mahasiswa mereka fasih dalam dua bahasa.

Selain daripada bertujuan berkebolehan dua (atau tiga) bahasa, sistem pendidikan kita mestilah beralasan kukuh atas sains dan ilmu hisab, serta mengalakkan murid berfikir. Sains membolehkan kita memahami alam di sekitar serta di dalam (diri) kita. Sains ialah kajian “Quran Kedua” yang dimaksudkan oleh Hamka. Ilmu hisab pula, tanpa kemahiran dalam mata pelajaran itu, kita tidak boleh berfikir dengan tepat, hanya agak- agak sahaja. Dan tanpa berkebolehan berfikir sendiri, rakyat akan jadi Pak Turut dan senang dipengaruhi.

Had sekolah patut dipanjangkan selama 13 tahun untuk semua, dengan empat mata pelajaran asas – BI, BM, Sains, dan Ilmu Hisab – dimestikan setiap hari dan setiap tahun. Mata pelajaran lain dipilih oleh sekolah dan pelajar. Saya tidak kira apa bahasa pengantar, sama ada BM, Swahili, atau Mandarin. Di Amerika sekarang sudah jadi kebiasaan untuk semua bersekolah 15 tahun, prasekolah ke darjah 12 (13 tahun) dan dua tahun kolej.

Saya mencadangkan pada tahun 10 hingga 13 (sekolah tinggi) penuntut disalurkan kepada tiga jurusan –akademik (untuk bakal mahasiswa), biasa (untuk bakal askar, kerani dan jururawat), dan vokasional, untuk melatih pembuat perabut, juru mekanik, dan tukang jahit. Murid boleh menukar saluran hanya semasa Tahun 10 dan 11. Ini cara Jerman, tetapi di sana saluran itu dimulai lebih awal lagi, pada tahun lima.

Selain daripada itu saya (cadangkan supaya) tambahkan peruntukan kepada sekolah yang mempunyai (komposisi) murid yang mencerminkan masyarakat Malaysia. Saya tidak memaksa tiap- tiap sekolah mengambil beberapa peratus murid Melayu, Cina dan sebagainya, tetapi sekolah yang berjaya mendapat murid berbilang kaum akan dihadiahkan dengan meningkatkan peruntukan wang, guru dan kelebihan lain, tidak kira apa bahasa pengantarnya. Begitu juga, saya akan melebihkan peruntukan untuk sekolah di mana muridnya terkumpul daripada keluarga miskin, seperti di luar bandar.

Saya tidak hapuskan sekolah terhad kepada satu kaum. Jauh sekali! Hanya sekolah tersebut jangan harap mendapat bantuan satu sen pun dari kerajaan. Tentang agama, itu patut di ajar hanya sebagai satu mata pelajaran sahaja dan bukan memenuhi seluruh masa atau sukatan pelajaran. Sekolah agama mesti mengajar empat mata pelajaran asas yang saya sebutkan dahulu (BI, BM, Sains, dan Ilmu Hisab). Saya tidak kira apa bahasa pengantar sekolah agama, samada Arab, BM, Mandarin (seperti di Negara China), atau B.I (seperti di Amerika). Sekolah agama Kristian di Amerika ramai penuntut bukan Kristian termasuk Islam oleh sebab mutu akademiknya tinggi.

Kalau sekolah agama Malaysia tinggi tarafnya, mungkin ibu bapa bukan Islam akan menghantar anak mereka. Tengoklah dahulu, Tun Razak dan Hussein Onn hantar anak mereka ke sekolah “mission” (satu jenis sekolah agama) Kristian!

Kelemahan yang nyata di antara murid Melayu ialah kemorosotan taraf BI. Saya anak kampung, ibu bapa saya tidak tahu langsung BI, dan bahasa itu jarang digunakan di sekitar alam saya semasa kecil. Tambahan pula saya bersekolah semasa negeri dijajah. Tetapi saya fasih dalam BI. Sepatutnya sekarang kita sudah merdeka, pimpinan negeri dalam tangan Melayu, kemudahan untuk murid Melayu untuk belajar BI semestinya lebih senang bila dibandingkan dengan masa dulu. Tetapi sebaliknya yang berlaku!

Apa sebab? Masyarakat dan pemimpin kita tidak memberatkan hal itu. Mereka menyifatkan mengalakkan BI bermakna kita tidak “memartabatkan” atau cinta bahasa kita. Itu kesilapan terbesar.

Oleh sebab taraf BI di (kalangan) murid kampung sudah jauh merosot, saya cadangkan mengadakan “immersion schools” mengunakan hanya BI selama sekurang kurangnya lima tahun dari prasekolah hingga ke darjah empat atau lima. Bahasa lain termasuk BM tidak diajar. Oleh sebab BM digunakan di sekitar luar sekolah dan di rumah, tidak mungkin murid akan lupa bertutur dalam itu.

Saya mensyaratkan satu sahaja. Iaitu murid dihadkan kepada mereka yang bahasa ibunda ialah BM, bahasa itu biasa digunakan di rumah serta sekitar, atau murid itu sudah fasih bertutur dalam BM.

Kalau seorang murid Cina sudah pandai bertutur dalam BM (seperti Cina Baba misalnya) mereka boleh masuk sekolah “English immersion.” Kita mesti mengadakan Sekolah Jenis Kebangsaan (Inggeris), di mana bahasa penghantar ialah BI, di kawasan kampung Melayu.

Satu cara lagi untuk meninggikan taraf BI antara murid Melayu ialah dengan menubuhkan Sekolah Agama yang menggunakan BI sebagai bahasa pengantar, seperti di Amerika. Sudah tentunya murid di sekolah itu akan fasih dalam BI, BM dan Bahasa Arab!

Itu dengan ringkasnya cadangan saya untuk membaiki, mengatasi atau mengganti sistem pendidikan kita. Saya kembangkan dengan lebih mendalam lagi melalui buku saya, An Education System Worthy of Malaysia (2003).

Untuk menutup (wawancara ini), saya bentangkan tiga unsur asas. Pertama, ibu bapa sahaja yang tahu apa yang baik untuk anak mereka. Maknanya, kita tidak boleh paksa ibu bapa menghantar anak mereka ke sekolah ini atau itu. Pilihan itu semestinya terletak di tangan ibu bapa, dan hanya kepada mereka dan bukan pemimpin politik atau pegawai pendidikan.

Kedua, mengikut kebijakan bekas Canselor German Willy Brandt, hanya satu sahaja bahasa rasmi di dunia ini, iaitu bahasa pelanggan kita. Kata Brandt, kalau saya ingin menjual, saya mesti menggunakan bahasa bakal pembeli.

Kalau saya membeli dari kau, kau mesti gunakan bahasa saya (Jerman)! Kalau kita ingin menjual lebih banyak lagi getah dan kelapa sawit kepada negara China dan Amerika, kita patut belajar bahasa mereka!

Ketiga, dan pandangan ini khas untuk orang Melayu sahaja, kita mesti ingat atas perbezaannya penting antara memajukan Bahasa Melayu dan memarakan Bangsa Melayu. BM boleh maju tetapi itu tidak bermakna Bangsa Melayu akan turut bersama. Tetapi kalau Bangsa Melayu maju, semestinya bahasa kita akan turut bersama.

Lebih penting ialah sebaliknya, iaitu jika Bangsa Melayu bangsat, tidak ramai yang ingin belajar BM. Itu termasuk orang Melayu sendiri. Lima puluh tahun dahulu negara China bangsat; tidak ramai berminat belajar Mandarin. Sekarang Negara China sudah maju, Mandarin ialah bahasa kedua yang sangat diminati oleh pelajar Amerika.

Ex-Army Chief rues lack of clear chain of command

March 6, 2013

Lahad Datu Incursion: Ex-Army  Chief rues lack of clear chain of command

by Hafiz Yatim@http://www.malaysiakini.com

There is no clear chain of command with regard to what is happening in Lahad Datu, says former army chief Gen (Rtd) Md Hashim Hussein.

When you have such a situation, Md Hashim said, there must be a clear command structure. “This is needed to coordinate the operations. Right now, I think it is not there,” he said.

However, Md Hashim (right), who retired in 2002, admitted that a clear assessment of the ground situation was needed.

In contrast, he said, the Sauk incident in Perak was resolved in four days, with the right personnel.

“We managed to resolve it due to a clear command structure, clear orders, clear control, plus we had the right troops for the task,” he said.

The retired general also warned the government against using information war to blackout incidents such as what was going on in Lahad Datu. “As for the information warfare that they use… What a tangled web we weave if we begin to deceive”.

Md Hashim also announced that he has officially joined PKR today and voiced his support for Pakatan Rakyat. Formerly Malaysia’s Ambassador to Pakistan, Md. Hashim said he is attracted to the leadership of Anwar Ibrahim, who was his schoolmate in the Malay College Kuala Kangsar (MCKK).

“He has managed to harmonise Pakatan, all ethnic communities and Malaysia, and this is due to Anwar’s leadership quality,” he said.

“I find the Pakatan leaders have the right leadership qualities and can lead the country. I also verify the claims made by my former number two, Lt-Gen Abdul Ghafir Abdul Hamid, on the wastage and leakages in army spending,” he said.

‘Barracks and facilities in bad shape’

Md Hashim, who was first commander to the Malaysian batallion in Bosnia-Herzogovina, said he had gone to some of the army camps up north to verify the claims made by Abdul Ghafir.  He said he had seen that army conditions are indeed in a bad shape, including their homes, barracks, washroom and also armaments.

“There was a former senior Air Force officer that reminded that there were no proper spare parts for aircraft, however, this person had been admonished by the (BN) politicians,” he claimed.

Md Hashim said he expected to receive brickbats for voicing his support for Pakatan, but assured that he had carefully thought about the matter after discussing with some of his former officers.

The former top army personnel said that the Pakatan leadership had been coercing him to make an appearance, and he thinks that there was a need to strategise his entrance into the party to bring the desired impact.

Over the past few weeks, several former armed forces top guns had voiced their support towards Pakatan. Abdul Ghafir had even pledged, during a Pakatan convention, that the army will ensure a smooth transition should the Opposition come into power after the general election.