President Barack H. Obama’s Message of Hope to America


January 11, 2017

President Barack H. Obama’s Message of Hope to America

Farewell Mr. President and thank you for keeping your fellow Americans and  we citizens of the world free from  major conflicts over the last 8 years. Your legacy is intact and your administration is a difficult act to follow. May God Bless you, Mrs. Michelle Obama and family. Welcome to the 45th POTUS, Donald J. Trump. Dr. Kamsiah Haider and Din Merican

The text of President Barack Obama’s farewell speech Tuesday night (US time) in Chicago, as prepared for delivery.

Barack Obama: America–Land the Brave and The Free–is Exceptional

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It’s good to be home. My fellow Americans, Michelle and I have been so touched by all the well-wishes we’ve received over the past few weeks. But tonight it’s my turn to say thanks. Whether we’ve seen eye-to-eye or rarely agreed at all, my conversations with you, the American people – in living rooms and schools; at farms and on factory floors; at diners and on distant outposts – are what have kept me honest, kept me inspired, and kept me going. Every day, I learned from you. You made me a better President, and you made me a better man.

I first came to Chicago when I was in my early twenties, still trying to figure out who I was; still searching for a purpose to my life. It was in neighbourhoods not far from here where I began working with church groups in the shadows of closed steel mills. It was on these streets where I witnessed the power of faith, and the quiet dignity of working people in the face of struggle and loss.

 This is where I learned that change only happens when ordinary people get involved, get engaged, and come together to demand it.

After eight years as your President, I still believe that. And it’s not just my belief. It’s the beating heart of our American idea – our bold experiment in self-government.

It’s the conviction that we are all created equal, endowed by our Creator with certain unalienable rights, among them life, liberty, and the pursuit of happiness.

It’s the insistence that these rights, while self-evident, have never been self-executing; that We, the People, through the instrument of our democracy, can form a more perfect union.

This is the great gift our Founders gave us. The freedom to chase our individual dreams through our sweat, toil, and imagination – and the imperative to strive together as well, to achieve a greater good.

For 240 years, our nation’s call to citizenship has given work and purpose to each new generation. It’s what led patriots to choose republic over tyranny, pioneers to trek west, slaves to brave that makeshift railroad to freedom. It’s what pulled immigrants and refugees across oceans and the Rio Grande, pushed women to reach for the ballot, powered workers to organise. It’s why GIs gave their lives at Omaha Beach and Iwo Jima; Iraq and Afghanistan – and why men and women from Selma to Stonewall were prepared to give theirs as well.

So that’s what we mean when we say America is exceptional. Not that our nation has been flawless from the start, but that we have shown the capacity to change, and make life better for those who follow.

Yes, our progress has been uneven. The work of democracy has always been hard, contentious and sometimes bloody. For every two steps forward, it often feels we take one step back. But the long sweep of America has been defined by forward motion, a constant widening of our founding creed to embrace all, and not just some.

If I had told you eight years ago that America would reverse a great recession, reboot our auto industry, and unleash the longest stretch of job creation in our history . if I had told you that we would open up a new chapter with the Cuban people, shut down Iran’s nuclear weapons program without firing a shot, and take out the mastermind of 9/11 . if I had told you that we would win marriage equality, and secure the right to health insurance for another 20 million of our fellow citizens – you might have said our sights were set a little too high.

But that’s what we did. That’s what you did. You were the change. You answered people’s hopes, and because of you, by almost every measure, America is a better, stronger place than it was when we started.

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In ten days, the world will witness a hallmark of our democracy: the peaceful transfer of power from one freely-elected president to the next. I committed to President-Elect Trump that my administration would ensure the smoothest possible transition, just as President Bush did for me. Because it’s up to all of us to make sure our government can help us meet the many challenges we still face.

We have what we need to do so. After all, we remain the wealthiest, most powerful, and most respected nation on Earth. Our youth and drive, our diversity and openness, our boundless capacity for risk and reinvention mean that the future should be ours.

But that potential will be realized only if our democracy works. Only if our politics reflects the decency of the people. Only if all of us, regardless of our party affiliation or particular interest, help restore the sense of common purpose that we so badly need right now.

That’s what I want to focus on tonight – the state of our democracy.

Understand, democracy does not require uniformity. Our founders quarrelled and compromised, and expected us to do the same. But they knew that democracy does require a basic sense of solidarity – the idea that for all our outward differences, we are all in this together; that we rise or fall as one.

There have been moments throughout our history that threatened to rupture that solidarity. The beginning of this century has been one of those times. A shrinking world, growing inequality; demographic change and the spectre of terrorism – these forces haven’t just tested our security and prosperity, but our democracy as well. And how we meet these challenges to our democracy will determine our ability to educate our kids, and create good jobs, and protect our homeland.

In other words, it will determine our future.

“Our democracy won’t work without a sense that everyone has economic opportunity”.

Our democracy won’t work without a sense that everyone has economic opportunity. Today, the economy is growing again; wages, incomes, home values, and retirement accounts are rising again; poverty is falling again. The wealthy are paying a fairer share of taxes even as the stock market shatters records. The unemployment rate is near a ten-year low. The uninsured rate has never, ever been lower. Health care costs are rising at the slowest rate in fifty years. And if anyone can put together a plan that is demonstrably better than the improvements we’ve made to our health care system – that covers as many people at less cost – I will publicly support it.

That, after all, is why we serve – to make people’s lives better, not worse.

But for all the real progress we’ve made, we know it’s not enough. Our economy doesn’t work as well or grow as fast when a few prosper at the expense of a growing middle class. But stark inequality is also corrosive to our democratic principles. While the top one per cent has amassed a bigger share of wealth and income, too many families, in inner cities and rural counties, have been left behind – the laid-off factory worker; the waitress and health care worker who struggle to pay the bills – convinced that the game is fixed against them, that their government only serves the interests of the powerful – a recipe for more cynicism and polarisation in our politics.

There are no quick fixes to this long-term trend. I agree that our trade should be fair and not just free. But the next wave of economic dislocation won’t come from overseas. It will come from the relentless pace of automation that makes many good, middle-class jobs obsolete.

And so we must forge a new social compact – to guarantee all our kids the education they need; to give workers the power to unionise for better wages; to update the social safety net to reflect the way we live now and make more reforms to the tax code so corporations and individuals who reap the most from the new economy don’t avoid their obligations to the country that’s made their success possible. We can argue about how to best achieve these goals. But we can’t be complacent about the goals themselves. For if we don’t create opportunity for all people, the disaffection and division that has stalled our progress will only sharpen in years to come.

There’s a second threat to our democracy – one as old as our nation itself. After my election, there was talk of a post-racial America. Such a vision, however well-intended, was never realistic. For race remains a potent and often divisive force in our society. I’ve lived long enough to know that race relations are better than they were ten, or twenty, or thirty years ago – you can see it not just in statistics, but in the attitudes of young Americans across the political spectrum.

But we’re not where we need to be. All of us have more work to do. After all, if every economic issue is framed as a struggle between a hardworking white middle class and undeserving minorities, then workers of all shades will be left fighting for scraps while the wealthy withdraw further into their private enclaves. If we decline to invest in the children of immigrants, just because they don’t look like us, we diminish the prospects of our own children – because those brown kids will represent a larger share of America’s workforce. And our economy doesn’t have to be a zero-sum game. Last year, incomes rose for all races, all age groups, for men and for women.

Going forward, we must uphold laws against discrimination – in hiring, in housing, in education and the criminal justice system. That’s what our Constitution and highest ideals require. But laws alone won’t be enough. Hearts must change. If our democracy is to work in this increasingly diverse nation, each one of us must try to heed the advice of one of the great characters in American fiction, Atticus Finch, who said “You never really understand a person until you consider things from his point of view.until you climb into his skin and walk around in it.”

For blacks and other minorities, it means tying our own struggles for justice to the challenges that a lot of people in this country face – the refugee, the immigrant, the rural poor, the transgender American, and also the middle-aged white man who from the outside may seem like he’s got all the advantages, but who’s seen his world upended by economic, cultural, and technological change.

For white Americans, it means acknowledging that the effects of slavery and Jim Crow didn’t suddenly vanish in the ’60s; that when minority groups voice discontent, they’re not just engaging in reverse racism or practising political correctness; that when they wage peaceful protest, they’re not demanding special treatment, but the equal treatment our Founders promised.

For native-born Americans, it means reminding ourselves that the stereotypes about immigrants today were said, almost word for word, about the Irish, Italians, and Poles. America wasn’t weakened by the presence of these newcomers; they embraced this nation’s creed, and it was strengthened.

So regardless of the station we occupy; we have to try harder; to start with the premise that each of our fellow citizens loves this country just as much as we do; that they value hard work and family like we do; that their children are just as curious and hopeful and worthy of love as our own.

None of this is easy. For too many of us, it’s become safer to retreat into our own bubbles, whether in our neighbourhoods or college campuses or places of worship or our social media feeds, surrounded by people who look like us and share the same political outlook and never challenge our assumptions. The rise of naked partisanship, increasing economic and regional stratification, the splintering of our media into a channel for every taste – all this makes this great sorting seem natural, even inevitable. And increasingly, we become so secure in our bubbles that we accept only information, whether true or not, that fits our opinions, instead of basing our opinions on the evidence that’s out there.

Politics is a battle of ideas

This trend represents a third threat to our democracy. Politics is a battle of ideas; in the course of a healthy debate, we’ll prioritise different goals, and the different means of reaching them. But without some common baseline of facts; without a willingness to admit new information, and concede that your opponent is making a fair point, and that science and reason matter, we’ll keep talking past each other, making common ground and compromise impossible.

Isn’t that part of what makes politics so dispiriting? How can elected officials rage about deficits when we propose to spend money on preschool for kids, but not when we’re cutting taxes for corporations? How do we excuse ethical lapses in our own party, but pounce when the other party does the same thing? It’s not just dishonest, this selective sorting of the facts; it’s self-defeating. Because as my mother used to tell me, reality has a way of catching up with you.

Take the challenge of climate change. In just eight years, we’ve halved our dependence on foreign oil, doubled our renewable energy, and led the world to an agreement that has the promise to save this planet. But without bolder action, our children won’t have time to debate the existence of climate change; they’ll be busy dealing with its effects: environmental disasters, economic disruptions, and waves of climate refugees seeking sanctuary.

Now, we can and should argue about the best approach to the problem. But to simply deny the problem not only betrays future generations; it betrays the essential spirit of innovation and practical problem-solving that guided our Founders.

It’s that spirit, born of the Enlightenment, that made us an economic powerhouse – the spirit that took flight at Kitty Hawk and Cape Canaveral; the spirit that cures disease and put a computer in every pocket.

“a faith in reason, and enterprise, and the primacy of right over might”.

Image result for obama as commander in chief“To all who serve, it has been the honor of my lifetime to be your Commander-in-Chief.

It’s that spirit – a faith in reason, and enterprise, and the primacy of right over might, that allowed us to resist the lure of fascism and tyranny during the Great Depression, and build a post-World War II order with other democracies, an order based not just on military power or national affiliations but on principles – the rule of law, human rights, freedoms of religion, speech, assembly, and an independent press.

That order is now being challenged – first by violent fanatics who claim to speak for Islam; more recently by autocrats in foreign capitals who see free markets, open democracies, and civil society itself as a threat to their power. The peril each poses to our democracy is more far-reaching than a car bomb or a missile. It represents the fear of change; the fear of people who look or speak or pray differently; a contempt for the rule of law that holds leaders accountable; an intolerance of dissent and free thought; a belief that the sword or the gun or the bomb or propaganda machine is the ultimate arbiter of what’s true and what’s right.

Because of the extraordinary courage of our men and women in uniform, and the intelligence officers, law enforcement, and diplomats who support them, no foreign terrorist organisation has successfully planned and executed an attack on our homeland these past eight years; and although Boston and Orlando remind us of how dangerous radicalisation can be, our law enforcement agencies are more effective and vigilant than ever. We’ve taken out tens of thousands of terrorists – including Osama bin Laden. The global coalition we’re leading against ISIL has taken out their leaders, and taken away about half their territory. ISIL will be destroyed, and no one who threatens America will ever be safe. To all who serve, it has been the honor of my lifetime to be your Commander-in-Chief.

But protecting our way of life requires more than our military. Democracy can buckle when we give in to fear. So just as we, as citizens, must remain vigilant against external aggression, we must guard against a weakening of the values that make us who we are. That’s why, for the past eight years, I’ve worked to put the fight against terrorism on a firm legal footing. That’s why we’ve ended torture, worked to close Gitmo, and reform our laws governing surveillance to protect privacy and civil liberties. That’s why I reject discrimination against Muslim Americans. That’s why we cannot withdraw from global fights – to expand democracy, and human rights, women’s rights, and LGBT rights – no matter how imperfect our efforts, no matter how expedient ignoring such values may seem. For the fight against extremism and intolerance and sectarianism are of a piece with the fight against authoritarianism and nationalist aggression. If the scope of freedom and respect for the rule of law shrinks around the world, the likelihood of war within and between nations increases, and our own freedoms will eventually be threatened.

“So let’s be vigilant, but not afraid.”

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So let’s be vigilant, but not afraid. ISIL will try to kill innocent people. But they cannot defeat America unless we betray our Constitution and our principles in the fight. Rivals like Russia or China cannot match our influence around the world – unless we give up what we stand for, and turn ourselves into just another big country that bullies smaller neighbours.

“our democracy is threatened whenever we take it for granted.”

Which brings me to my final point – our democracy is threatened whenever we take it for granted. All of us, regardless of party, should throw ourselves into the task of rebuilding our democratic institutions. When voting rates are some of the lowest among advanced democracies, we should make it easier, not harder, to vote. When trust in our institutions is low, we should reduce the corrosive influence of money in our politics, and insist on the principles of transparency and ethics in public service. When Congress is dysfunctional, we should draw our districts to encourage politicians to cater to common sense and not rigid extremes.

And all of this depends on our participation; on each of us accepting the responsibility of citizenship, regardless of which way the pendulum of power swings.

Our Constitution is a remarkable, beautiful gift. But it’s really just a piece of parchment. It has no power on its own. We, the people, give it power – with our participation, and the choices we make. Whether or not we stand up for our freedoms. Whether or not we respect and enforce the rule of law. America is no fragile thing. But the gains of our long journey to freedom are not assured.

In his own farewell address, George Washington wrote that self-government is the underpinning of our safety, prosperity, and liberty, but “from different causes and from different quarters much pains will be taken.to weaken in your minds the conviction of this truth;” that we should preserve it with “jealous anxiety;” that we should reject “the first dawning of every attempt to alienate any portion of our country from the rest or to enfeeble the sacred ties” that make us one.

We weaken those ties when we allow our political dialogue to become so corrosive that people of good character are turned off from public service; so coarse with rancour that Americans with whom we disagree are not just misguided, but somehow malevolent. We weaken those ties when we define some of us as more American than others; when we write off the whole system as inevitably corrupt, and blame the leaders we elect without examining our own role in electing them.

It falls to each of us to be those anxious, jealous guardians of our democracy; to embrace the joyous task we’ve been given to continually try to improve this great nation of ours. Because for all our outward differences, we all share the same proud title: Citizen.

Ultimately, that’s what our democracy demands. It needs you. Not just when there’s an election, not just when your own narrow interest is at stake, but over the full span of a lifetime. If you’re tired of arguing with strangers on the internet, try to talk with one in real life. If something needs fixing, lace up your shoes and do some organising. If you’re disappointed by your elected officials, grab a clipboard, get some signatures, and run for office yourself. Show up. Dive in. Persevere. Sometimes you’ll win. Sometimes you’ll lose. Presuming a reservoir of goodness in others can be a risk, and there will be times when the process disappoints you. But for those of us fortunate enough to have been a part of this work, to see it up close, let me tell you, it can energise and inspire. And more often than not, your faith in America – and in Americans – will be confirmed.

Mine sure has been. Over the course of these eight years, I’ve seen the hopeful faces of young graduates and our newest military officers. I’ve mourned with grieving families searching for answers, and found grace in Charleston church. I’ve seen our scientists help a paralysed man regain his sense of touch, and our wounded warriors walk again. I’ve seen our doctors and volunteers rebuild after earthquakes and stop pandemics in their tracks. I’ve seen the youngest of children remind us of our obligations to care for refugees, to work in peace, and above all to look out for each other.

That faith I placed all those years ago, not far from here, in the power of ordinary Americans to bring about change – that faith has been rewarded in ways I couldn’t possibly have imagined. I hope yours has, too. Some of you here tonight or watching at home were there with us in 2004, in 2008, in 2012 – and maybe you still can’t believe we pulled this whole thing off.

You’re not the only ones. Michelle – for the past twenty-five years, you’ve been not only my wife and mother of my children, but my best friend. You took on a role you didn’t ask for and made it your own with grace and grit and style and good humour. You made the White House a place that belongs to everybody. And a new generation sets its sights higher because it has you as a role model. You’ve made me proud. You’ve made the country proud.

Malia and Sasha, under the strangest of circumstances, you have become two amazing young women, smart and beautiful, but more importantly, kind and thoughtful and full of passion. You wore the burden of years in the spotlight so easily. Of all that I’ve done in my life, I’m most proud to be your dad.

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” To Joe Biden, you were the first choice I made as a nominee, and the best. Not just because you have been a great Vice President, but because in the bargain, I gained a brother. “

To Joe Biden, the scrappy kid from Scranton who became Delaware’s favorite son: you were the first choice I made as a nominee, and the best. Not just because you have been a great Vice President, but because in the bargain, I gained a brother. We love you and Jill like family, and your friendship has been one of the great joys of our life.

To my remarkable staff: For eight years – and for some of you, a whole lot more – I’ve drawn from your energy, and tried to reflect back what you displayed every day: heart, and character, and idealism. I’ve watched you grow up, get married, have kids, and start incredible new journeys of your own. Even when times got tough and frustrating, you never let Washington get the better of you. The only thing that makes me prouder than all the good we’ve done is the thought of all the remarkable things you’ll achieve from here.

And to all of you out there – every organiser who moved to an unfamiliar town and kind family who welcomed them in, every volunteer who knocked on doors, every young person who cast a ballot for the first time, every American who lived and breathed the hard work of change – you are the best supporters and organisers anyone could hope for, and I will forever be grateful. Because yes, you changed the world.

That’s why I leave this stage tonight even more optimistic about this country than I was when we started. Because I know our work has not only helped so many Americans; it has inspired so many Americans – especially so many young people out there – to believe you can make a difference; to hitch your wagon to something bigger than yourselves. This generation coming up – unselfish, altruistic, creative, patriotic – I’ve seen you in every corner of the country. You believe in a fair, just, inclusive America; you know that constant change has been America’s hallmark, something not to fear but to embrace, and you are willing to carry this hard work of democracy forward. You’ll soon outnumber any of us, and I believe as a result that the future is in good hands.

“My fellow Americans, it has been the honor of my life to serve you.”

My fellow Americans, it has been the honor of my life to serve you. I won’t stop; in fact, I will be right there with you, as a citizen, for all my days that remain. For now, whether you’re young or young at heart, I do have one final ask of you as your President – the same thing I asked when you took a chance on me eight years ago.

I am asking you to believe. Not in my ability to bring about change – but in yours.

I am asking you to hold fast to that faith written into our founding documents; that idea whispered by slaves and abolitionists; that spirit sung by immigrants and homesteaders and those who marched for justice; that creed reaffirmed by those who planted flags from foreign battlefields to the surface of the moon; a creed at the core of every American whose story is not yet written:

Yes We Can.

Yes We Did.

Yes We Can.

Thank you. God bless you. And may God continue to bless the United States of America.

-AP

Malaysians no longer trust Najib Razak


December 29, 2016

S.E.A. View

Malaysians  no longer trust  Najib Razak

http://www.straitstimes.com/opinion/what-price-malaysias-trust-deficit

The lack of excitement over massive infrastructure projects and ringgit’s plunge are signs of market and ground sentiments

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Malaysia’s Prime Minister Najib Razak and Big Momma Rosmah Mansor

The last weeks of December have been busy ones for Malaysian Prime Minister Najib Razak. On December 13, Datuk Seri Najib signed the much awaited High Speed Rail (HSR) agreement with Prime Minister Lee Hsien Loong that will link Kuala Lumpur and Singapore.

That same week, he officiated at the opening of Malaysia’s Mass Rapid Transit (MRT), a project that started in 2011. Days later, on December 18, Mr Najib launched the 1.4km-long Batang Sadong Bridge in Sarawak, a huge connectivity leap for Sarawakians, who previously had to rely on ferry crossings. The bridge is one of several projects the government has in store for Sarawak, the others being the massive 2,000km-long Pan Borneo Highway that will link Sarawak and Sabah and a coastal highway that will connect towns in Sarawak.

Soon after the Sarawak trip, Mr Najib was in Sabah to launch eight projects linked to the Pan-Borneo Highway. The recent launches came weeks after Mr Najib’s trip to China, one that saw the Malaysian economy potentially receiving a thumping US$33 billion (S$48 billion) of Chinese investment. A major part of the investment deal was Malaysia agreeing to build a 640km-long East Coast Rail Line(ECRL) with Chinese financing. Once completed, the ECRL will link the northernmost town in the east coast state of Kelantan to Port Klang, which fronts the busy Straits of Malacca on the west coast. Needless to say, these infrastructural investments are major game changers that are set to alter Malaysia’s landscape in a fundamental way, unleashing the country’s huge economic potential.

Such long-term growth commitment should excite the public, but not so in Malaysia. As for China’s massive investment, Mr Najib’s critics see it as a sell-out to China’s interest. They were also quick to contest that the US$13 billion ECRL project was overpriced – never mind that the proposed line needs to negotiate the Titiwangsa ridge, difficult geographical terrain that has for a long time kept the east coast of the peninsular relatively underdeveloped compared with the west coast.

What is apparent is that Mr Najib’s policies attract sceptics. Malaysians, it seems, are less willing to go along with government policies no matter how attractive the long-term benefits are. An obvious reason is that nagging political issues continue to cloud the many positives of Mr Najib’s policy initiatives. People in Malaysia are not quite done with the 1MDB issue. The international media has also kept turning the spotlight on 1MDB and Mr Najib, reinforcing public scepticism. What is obvious is that Malaysians are stuck in second gear, unwilling to move beyond the 1MDB issue.

Is Malaysia paying a heavy price for its ongoing political crisis? It seems so. The state is suffering from a trust deficit. Trust, between the governed and the government, seems to be in short supply. The 2016 Edelman Trust Barometer found that only 39 per cent of Malaysia’s general population trusts the government

Is Malaysia paying a heavy price for its ongoing political crisis? It seems so. The state is suffering from a trust deficit. Trust, between the governed and the government, seems to be in short supply. The 2016 Edelman Trust Barometer found that only 39 per cent of Malaysia’s general population trusts the government. That needs addressing because a trust deficit prevents the state from garnering policy collaborators. Policy “buy-in” becomes difficult as stakeholders are unwilling to be part of the policy process. Worse, a trust deficit could also see stakeholders subverting what otherwise could be effective policies. Mr Najib’s market-friendly policies, which would have been gladly accepted in the past, are now looked upon with intense scepticism. His decision to lift fuel subsidies, allow 70 per cent foreign ownership in the services sector, sell all the government’s Proton shares and introduce the goods and services tax (GST) to prevent leakage and broaden the tax base are but a few market-friendly policies that, thus far, have not warmed citizens’ hearts. Malaysians are still unwilling to accept the GST even when GST receipts have clearly buffered Malaysia’s huge losses in petroleum revenue in the past year.

Mr Najib launching Malaysia’s MRT on Dec 15. The lack of public trust stands in the way of Malaysia’s long-term goals. PHOTO: AGENCE FRANCE-PRESSE

A trust deficit could potentially lead to more damaging systemic risk. Thinning public trust and greater tendency to talk down the economy could amplify Malaysia’s political, social and economic risks. A self-fulfilling prophecy may set in, creating a case where the public runs down the economy more than it should and triggering a crisis of confidence. An obvious benchmark of confidence is the Malaysian ringgit, Asia’s worst-performing currency. Though there are external factors that have contributed to the weakening of the ringgit – Trumponomics, the attractiveness of US bond yields and weak commodity prices – analysts are also quick to add that the ringgit suffers from domestic risks, the premium of which is anybody’s guess. Some see domestic risk as one contributing factor to the ringgit weakening to a rate of RM4.70 to US$1.

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There are those who think that the ringgit slide is overdone as it does not reflect Malaysia’s fundamentals. But under conditions of low public trust, good economic figures are quickly neutralised by bad economic ones. Going by fundamentals alone, there are reasons not to short the ringgit. The Malaysian economy has shown plenty of resilience despite chaotic domestic politics and severe economic headwinds. Its GDP has averaged 5.3 per cent growth since 2011. This year, the economy is expected to grow at 4.2 per cent. For next year, the IMF predicts the economy to grow at 4.5 per cent on the back of strong domestic consumption. The country is also in better fiscal shape, with Mr Najib keeping to his promise to trim spending. The Budget deficit now stands at 3 per cent of GDP, down from a high of 6 per cent in 2009. Its current account remains positive. In fact the current account saw a sharp increase in the third quarter, the highest since December last year. More importantly, the economy has broken away from its heavy reliance on the oil and gas sector. Petroleum now counts for just 15 per cent of total revenue, a sharp drop from about 30 per cent two years ago. The economic figures, however, do not seem to count when it comes to the sliding ringgit.

Finally, broken trust between the state and the governed is affecting Malaysia’s long-term effort at institutional change. Change is difficult when stakeholders are unwilling to ride on the change agenda. In a low-trust environment, stakeholders are persuaded by partisan concerns, depriving the change agenda of a diversity of views. The Najib administration, for instance, has introduced the “blue ocean” strategy as part of its strategic blueprint. Developed by two INSEAD professors, the strategy rethinks the idea of competition and collaboration and has been behind many of Malaysia’s government and economic transformation programmes. Policy emphasis on the bottom 40 per cent of income- earners, retargeting state subsidies, providing direct transfers to low income earners, collaboration and sharing of resources between government agencies and building a one-stop centre for public services are among the few policy initiatives that seemed to enjoy little public buy-ins.

An exploratory study I carried out between September and October to gauge public receptiveness to the government’s national blue ocean strategy, part of wider research on networked government, found that the public know little or nothing at all of such blueprint. Trust, or the lack of it, has blurred the public’s identification with policies, making them unwilling partners of institutional change.

With a general election expected next year, Mr Najib has his work cut out for him. Restoring public trust is proving to be difficult but the need for it is urgent. Systematic public disengagement from political leadership could well be the most important factor that stands in the way of Malaysia’s long-term goals. In the short-term though, Malaysians should be careful that their attempts at political change do not cripple an otherwise functioning economy.


  • The writer is a visiting research fellow at the Sir Walter Murdoch School of Public Policy, Murdoch University and Assistant Professor at the Tun Abdul Razak School of Government, Universiti Tun Abdul Razak. 

Latest World Bank Report on MALAYSIA


December 23, 2016

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Malaysia’s Finance Minister: He needs a lot of help; in stead as Prime Minister he is a victim of sycophancy

Note: All reports by the IMF, World Bank, Asian Development and other multilateral institutions should be read between the lines to discern what is not said. I am confident my readers will exercise due care when they are presented with reports on Malaysia by these institutions.–Din Merican

Latest World Bank Report on MALAYSIA

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Malaysia Economic Monitor December 2016: The Quest for Productivity Growth

Malaysia’s economic growth has slowed down but remains resilient to external challenges.

  • The gross domestic product (GDP) growth rate is projected to reach 4.2% in 2016 and 4.3% in 2017.
  • Private consumption is expected to continue driving economic growth, supported by low unemployment and government income-support measures.
  • Private investment growth is expected to moderate, as commodity prices and global economic activity remain subdued.
  • Fiscal consolidation remains on track despite lower oil-related revenues.
  • Uncertainties around the rebalancing of the Chinese economy, further declines in the world commodities’ prices, and evolving US economic policies on global trade are some of the key sources of risks to Malaysia’s economic outlook.

Productivity is the main driver of Malaysia’s economic development, though productivity growth has slowed over the past decade.

  • Capital and labor have mainly driven Malaysia’s robust economic growth over the past 25 years. While significant, Malaysia’s productivity growth over the past 25 years has been below several global and regional countries.
  • As capital and labor are expected to slow down, rising productivity growth, greater female labor-force participation, and continued investment in physical and human capital will be necessary for Malaysia to achieve high-income status.
  • Malaysia has performed relatively well on key aspects of productivity, such as in the quality of infrastructure, and non-technical innovations.
  • Malaysia’s existing institutional architecture has sustained consistent productivity growth for more than two decades. Challenges in the skills gap, quality of infrastructure, and research and development system need to be addressed in order to refocus attention on productivity growth.
  • Overcoming skill gaps, building innovation capacity, and addressing distortion in markets where firms sell their goods and services, could help accelerate productivity growth further.

LINKs FOR DOWNLOADING THE PRESENTATION AND THE FULL REPORT

http://pubdocs.worldbank.org/en/183141482112459157/MEM-Productivity-Presentation-December-19.pdf

http://documents.worldbank.org/curated/en/773621481895271934/Malaysia-economic-monitor-the-quest-for-productivity-growth

 

 

 

 

 

 

 

 

World Bank Doing Business Report Continues to Mislead


December 16, 2016

More of the Same: World Bank Doing Business Report Continues to Mislead

Anis Chowdhury, a former professor of economics at the University of Western Sydney, held senior United Nations positions during 2008–2015 in New York and Bangkok. Jomo Kwame Sundaram, a former economics professor, was United Nations Assistant Secretary-General for Economic Development, and received the Wassily Leontief Prize for Advancing the Frontiers of Economic Thought in 2007.

Eight of The World Bank's "Doing Business" report 2017’s ‘top 10 improvers’ including  Kenya, Pakistan, the United Arab Emirates and Bahrain have, in fact, worsened workers’ rights, according to the International Trade Union Confederation. Credit: IPS

Eight of The World Bank’s “Doing Business” report 2017’s ‘top 10 improvers’ including Kenya, Pakistan, the United Arab Emirates and Bahrain have, in fact, worsened workers’ rights, according to the International Trade Union Confederation. Credit: IPS

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Malaysia’s Professor Jomo Kwame Sundaram

SYDNEY and KUALA LUMPUR, December 15, 2016 (IPS) – The World Bank’s Doing Business Report 2017, subtitled ‘Equal Opportunity for All’, continues to mislead despite the many criticisms, including from within, levelled against the Bank’s most widely read publication, and Bank management promises of reform for many years.

Its Foreword claims, “Evidence from 175 economies reveals that economies with more stringent entry regulations often experience higher levels of income inequality as measured by the Gini index.” But what is the evidence base for its strong claims, e.g., that “economies with more business-friendly regulations tend to have lower levels of income inequality”?

Closer examination suggests that the “evidence” is actually quite weak, and heavily influenced by countries closer to the ‘frontier’, mainly developed countries, most of which have long introduced egalitarian redistributive reforms reflected in taxation, employment and social welfare measures, and where inequality remains lower than in many developing countries.

The report notes that relations between DB scores and inequality ‘differ by regulatory area’. But it only mentions two, for ‘starting a business’ and for ‘resolving insolvency’. For both, higher DB scores are associated with less inequality, but has nothing to say on other DB indicators.

Other studies — by the OECD, IMF, ADB and the United Nations — negatively correlate inequality and the tax/GDP ratio. Higher taxes enable governments to spend more on public health, education and social protection, and are associated with higher government social expenditure/GDP ratios and lower inequality. The DBR’s total tax rate indicator awards the highest scores to countries with the lowest tax rates and other contributions (such as for social security) required of businesses.

Bias

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The DBR’s bias to deregulation is very clear. First, despite the weak empirical evidence and the fallacy of claiming causation from mere association, it makes a strong general claim that less regulation reduces inequality. Second, in its selective reporting, the DBR fails to report on many correlations not convenient for its purpose, namely advocacy of particular policies in line with its own ideology.

The World Bank had suspended the DBR’s labour indicator in 2009 after objections — by labour, governments and the ILO — to its deployment to pressure countries to weaken worker protections. But its push for labour market deregulation continues. For example, Tanzania’s score is cut in 2017 for introducing a workers’ compensation tariff to be paid by employers while Malta is penalized for increasing the maximum social security contribution to be paid by employers.

New Zealand beat Singapore to take first place in the latest DBR rankings following reforms reducing employers’ contributions to worker accident compensation. Nothing is said about how it has become a prime location for ‘money-laundering’ ‘shell’ companies.

Meanwhile, Kazakhstan, Kenya, Belarus, Serbia, Georgia, Pakistan, the United Arab Emirates and Bahrain — eight of DB 2017’s ‘top 10 improvers’ –– have recorded poor and, in some cases, worsening workers’ rights, according to the International Trade Union Confederation. A DBR 2017 annex claims that labour market regulation can ‘reduce the risk of job loss and support equity and social cohesion’, but devotes far more space to promoting fixed term contracts with minimal benefits and severance pay requirements.

In support of its claim of adverse impacts of labour regulations, DBR 2017 cites three World Bank studies from several years ago. Incredibly, it does not mention the extensive review of empirical studies in the Bank’s more recent flagship World Development Report 2013: Jobs, which found that “most estimates of the impacts [of labour regulations] on employment levels tend to be insignificant or modest”.

DBR 2017 adds gender components to its three indicator sets — starting a business, registering property and enforcing contracts — concluding: “For the most part, the formal regulatory environment as measured by Doing Business does not differentiate procedures according to the gender of the business owner. The addition of gender components to three separate indicators has a small impact on each of them and therefore a small impact overall”.

Should anyone be surprised by the DBR’s conclusion? It ignores the fact that the policies promoted by the Bank especially adversely affect women workers who tend to be concentrated in the lowest paid, least unionized jobs, e.g., in garments and apparel production or electronics assembly. The DBR also discourages regulations improving working conditions, e.g., for equal pay and maternity benefits.

Despite its ostensible commitment to ‘equal opportunities for all’, the DBR cannot conceal its intent and bias, giving higher scores to countries that favour corporate profits over citizens’, especially workers’ interests, and national efforts to achieve sustainable development.

Sadly, many developing country governments still bend over backwards to impress the World Bank with reforms to improve their DBR rankings. This obsession with performing well in the Bank’s ‘beauty contest’ has taken a heavy toll on workers, farmers and the world’s poor — the majority of whom are women — who bear the burden of DBR-induced reforms, despite its proclaimed concerns for inequality, gender equity and ‘equal opportunities for all’.

 http://www.ipsnews.net/2016/12/more-of-the-same-world-bank-doing-business-report-continues-to-mislead/

 

Free market alternatives


November 27, 2016

Here is something I wrote in The Phnom Penh Post in 1996, which may still be of interest. Of course, Cambodia has come a long way, having achieved average GDP of over 7 per cent p.a. over the last 20 years. It is enjoying peace and security, thanks to the strong leadership of Prime Minister Samdech Techo Hun Sen.–Din Merican

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Free market alternatives

The Editor,

I read Mr Matthew Grainger’s balanced and interesting report on the recent CDRI International Roundtable on Structural Adjustment Programme in Cambodia (January 26, 1996). I also read Dr Walden Bello’s paper titled “Economic Liberalization in Southeast Asia: Lessons for Cambodia”, and Dr K.P. Kannan’s paper, “Economic Reform, Structural Adjustment and Development: Issues and Implications”.

Dr Bello of Chulalongkorn University’s Social Research Institute in Thailand and Dr Kannan, CDRIs research director, are reminding policy makers in Cambodia that there is an alternative paradigm for Cambodian economic development to the standard IMF/IBRD prescription of market economics.

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The trickle-down theory is attractive in concept, but it has limited relevance in the real world due to market imperfections. Government intervention, as a result, is necessary to ensure equity and development without degradation of the environment.

Growth and equity are two sides of the same coin. For that reason, real GDP growth, in my view, is alone not a good indicator, if we ignore the distributional or equity and environmental aspects of development. One has to look at Thailand and Malaysia to realize that this obsession with GDP growth rates among policy makers results in serious socio-economic imbalances with long-term political consequences.

Malaysia’s realization of this problem is now incorporated in its Second Outline Perspective Plan 1991-2000. Even as of yesterday (Feb 13), Malaysia’s Deputy Prime Minister Dato Seri Anwar Ibrahim was reported to have said that in the next Malaysia Plan, our seventh, the social and related aspects of development will receive greater attention. After nearly 40 years of economic management, Malaysia’s decision to evaluate its strategies and adopt new approaches to achieve more balanced development supports Dr. Bello’s call “to articulate an alternative future” and “to ponder carefully the consequences of fast track capitalism…”

We must remind ourselves what development is all about. Here I would quote Dr Kannan:

“In terms of development, the ultimate objective is that of human development and reducing inequities as between people and regions.”

I am, of course, reminded of great development economists of the sixties like Sir Arthur Lewis, Gunnar Myrdal, Jan Tinbergen and Ragnar Nurkse and my mentors in economics, Clifton Wharton Jr., and Ungku Abdul Aziz (Malaysia), who studied the processes of development and underdevelopment with a socio-cultural perspective.

Development is about bringing about systematic change, and providing meaning to the lives of people so that they have opportunities to progress as far as their abilities can take them. It is about ensuring that scarce resources are used responsibly so that succeeding generations can build on the efforts and achievements of their forebears.

It is about institutions, culture and people. It does not exist in a vacuum, certainly not in econometric models, computer simulations, scenario planning systems or in the air-conditioned offices of the World Bank, IMF and the ADB. Most of all, development is about responsibility and accountability for all stakeholders, not a power game.

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Because it is a grassroots process and culture bound, development must be driven by nationals, in the case of Cambodia by Cambodians, with a shared vision, not by experts who have no stake and who do not have to live with the consequences of their prescriptions. This is not to discount the contributions made by the international community, donor countries and multilateral agencies. But it does emphasize that the granting of technical and financial assistance does not confer on the provider the right to impose their own values, preferences and way of life, or to dictate what is best for the beneficiary.

Cambodian leaders know what they want for their country. They have a clear vision of their country’s future as reflected in their National Programme (NPRD) and this is more than what can be said about some countries in the Third World. They have a strategic purpose which is to create a fair, just and peaceful society and, through strong sustainable economic growth, to raise the living standards for all Cambodians.

Cambodia is committed to a democratic system of government with a Constitutional Monarchy, and free market economic system with the private sector as the engine of growth and government in the role of strategist and manager-mentor.

Cambodia is adopting a state-directed economic growth strategy. This approach accepts the price mechanism, and the market in general, as an efficient allocator of resources. It also taps the dynamism of the private sector, but recognizes that government activism is essential in the area of national strategy in a competitive and interdependent world and to tame the excesses of the profit motive and ensure that economic growth is sustainable, balanced and equitable in the long term.

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Their development will be on the back of agriculture which is today the step child of most economies in East Asia. It may not be the “sexy thing” to do, but Cambodia is making its first wise move. Modern agriculture backed by advances in bio-technology, efficient water resource management systems, and strong marketing and distribution networks is a profitable undertaking.

Since the private sector is going to be given a prominent role in the development of the Kingdom, the World Bank and other multilateral agencies should finance a master plan study on small and medium scale industries and businesses and recommend policies and strategies for developing this sector. In many countries in East Asia, this sector is the driver of economic activity with the greatest potential for growth.

It is more refreshing to talk about development than other issues, usually negative ones, about Cambodia. The country has done well since the formation of the Royal Government. The tasks and challenges ahead are daunting. Cambodia needs the understanding and the patient support and cooperation of friends. Credit when it is due should be given. Criticisms, on the other hand, should be constructive.

For democracy to survive in Cambodia, economic development is essential. I have not known of any situation in the world where democracy exists side by side with abject poverty, unemployment, illiteracy and social inequities.

I stand, therefore, to be educated by anyone who has had the privilege of seeing democracy in a symbiotic relationship with the aforementioned phenomena.

I hope your readers – especially those in the IMF, World Bank, ADB and UNDP here in Phnom Penh – will respond with their comments on my letter. If that happens, my purpose in writing this letter as a sort of rejoinder to the Cambodian development debate is well served.

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Din Merican 2016

– Din Merican, Phnom Penh. (Din Merican is an economist with an MBA degree from the United States, who worked for more than 30 years in the Central Bank in Malaysia and in the private banking industry. This letter represents his personal views.)

New World Order under stress


November 16, 2016

New World Order under stress

by Chheang Vannarith

http://www.khemertimes.com

In a result that stunned the whole world, Donald Trump has been elected as the 45th President of the United States, defeating the more favored Democrat nominee Hillary Clinton.

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Mr. Trump’s victory signified rising nationalist populism, not only in the US, but also in other parts of the world. It also challenges the liberal world order based on democratic values, economic openness and the rules-based international economic system.

From Brexit to Mr. Trump’s victory, there is one thing in common, and that is the increasing frustration against the old establishment driven by political elites. Many wish to see a different type of leadership and are hoping for change.

We are living in a highly unpredictable and uncertain world. We need to think the unthinkable and be prepared to adapt to unexpected changes. Those who can grasp the opportunities deriving from a crisis and uncertainty will remain competitive.

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The bipolar world established after World War II was replaced by a unipolar world in which the US played a hegemonic power. However,  US power has been declining since the world economic crisis in 2008. Over the past decade, the rise of others such as China, India and Russia has challenged the global role of the US from economic to security domains.

We are now entering either a multipolar world or zero-polar world. Under the multipolar world, there are multiple actors and stakeholders working together to shape and construct global governance and order.In a zero-polar world, there will be no country taking a global leadership role. The major powers will become more nationalist and inward looking. Selfish national interests and zero-sum games will dominate international politics.

If this happens the world will become fragmented and chaotic. Global uncertainties and risks are going to rise. No country will be willing and able to take a global leadership role to maintain world peace and order.

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The US is great nation largely thanks to democratic pluralism, multiculturalism as well as an open and liberal globalization which has provided tremendous opportunities for Americans. It has successfully integrated itself into and largely benefited from the rest of the world.

Now it is different. Mr. Trump seems to be opting for a more nationalistic, protectionist and inward-looking foreign policy. His populist political rhetoric will adversely affect the liberal order created by the US seven decades ago.

Mr. Trump lacks a robust foreign policy. He seems to mainly focus on populist domestic social and economic issues. Global issues such as climate change will not be addressed effectively without a strong US leadership role.

It is predicted that the US’ global role will further decline, which in turn will create a global power vacuum and a deep hole in global governance.

China, Japan, India and Russia are expected to fill the gap and play a more proactive role in maintaining global peace and order. However, these countries are still struggling with their own domestic issues.

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Obama in Laos

In the Asia-Pacific region, the US has been the hub of regional peace and order. Since 2010, the US has introduced and implemented its “rebalance” or “pivot” to Asia in order to strengthen its alliance system, promote economic integration and deepen people-to-people
ties.

President Barack Obama has had a strong interest in promoting the US’ role in the Asia-Pacific. He has committed to strengthening an ASEAN-led regional architecture.

The US-led Trans-Pacific Partnership is a crucial US external economic policy towards Asia. However, it has an extremely low chance of ratification under the future Trump administration.
Under Mr. Trump’s leadership, the US will be less engaged in Asia.

In such a scenario, China will gain more strategic advantages in leveraging its regional influence.US allies in Asia will be forced to invest more in the defense sector in their collective deterrence strategy. Japan, South Korea and Australia will speed up their defense modernization.

The new world order as well as the Asia-Pacific order will go through critical tests, uncertain power diffusion and transition as well as a severe security environment.

As we live in a world with high uncertainty and risk, leaders need to be equipped with the capacity to think the unthinkable, have the courage to change and create a safe space for institutional innovation and transformative leadership.

It is a wake-up call for world leaders to reconstruct the world economy so it is more inclusive and sustainable. Unless fair and just industrialization, and social justice, are respected, the prospect of global disintegration and fragmentation will continue to haunt the world