Judge Pakatan Harapan in 5 years, Dr. Rais Hussin


August 17, 2018

Judge Pakatan Harapan in 100 days, maybe too soon, but in 5 years definitely too late, Dr. Rais Hussin

Shocking  Admission

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The Pakatan Harapan Manifesto was launched in March 2018. It is now more than 100 days. How much more time do our new  Yang Berhormat Menteris and Timbalan Menteris need to read and understand their own pledges? What a shame.–Din Merican

Pakatan Harapan ministers and deputy ministers must take the time to read the coalition’s election manifesto, said Bersatu policy and strategy bureau chief Rais Hussin, who was part of the Harapan manifesto committee.

–www.malaysiakini.com

Interview with Dr. Rais Hussin, Pakatan Harapan’s Top  Spinner

by http://www.malaysiakini.com

100 DAYS | Pakatan Harapan ministers and deputy ministers must take the time to read the coalition’s election manifesto, said Bersatu policy and strategy bureau chief Rais Hussin, who was part of the Harapan manifesto committee.

“It is an observation but even ministers and deputy ministers have not read the manifesto.

“So, my first request is that the people, who are supposed to chaperone and deliver the promises, must read the manifesto,” he told Malaysiakini in an interview conducted in conjunction with Harapan’s 100 days in government.

Rais said this should also be expanded to chief secretaries and top civil servants.

“All those implementers, they also need to read this manifesto. It is important for them to read because this is the policy and main points of the Harapan administration – therefore they should be in the know,” he said.

Harapan had made 10 pledges for its first 100 days, but moving on, its longer-term promises will comprise 60 items.

However, Harapan was only able to fully fulfil two of the 10 promises within the first 100 days, namely the abolition of the Goods and Services Tax (GST), and the review of mega projects.

Rais stressed that this was not a case of promises being broken, pointing out that the ministers were hard at work to try to fulfil them, albeit with a delayed timeline.

He reiterated that Harapan’s manifesto was drafted based on public information and without details that have now become available after the coalition became the government, particularly on the debt level.

“But we believe that given some time and recalibration of our plans, all these promises can be fulfilled,” Rais said.

Instead of finding excuses to justify failing to deliver on promises, he added, he believed in looking for solutions.

Post-GE attention on manifesto ‘unprecedented’

He added that the fact that Harapan’s manifesto is being talked about on a daily basis after the 14th general election was an achievement in itself.

“In the last 13 general elections, manifestos were only discussed before a general election but not afterwards.But after the 14th general election, everyone is talking about the manifesto every day. There is a new intensity in participatory democracy… people have become more sensitive,” he said.

Rais was also asked about Prime Minister Dr Mahathir Mohamad downplaying the manifesto, such as his statement that it was “not a Bible” or that it was too “thick“.

“If someone comes and say that it is not a ‘kitab suci’ (holy scripture) and all that, I leave it up to that person. Maybe it is to build a narrative to soften the blow or pressure on the ministers.

“In managing the country, you can’t write a thin manifesto. You need a thick manifesto, especially when it covers all walks of society.

 

“What is important is that what is contained, regardless if the manifesto is thin or thick, is the deliverables. We should not focus on excuses but on how to deliver,” he said.

Rais, who had previously said on May 14 that a manifesto monitoring committee would be formed, said he did raise the subject with the government.

‘Judge us in five years’

However, he said the government decided to have the committee within the cabinet and that the committee is chaired by Mahathir himself.

“If I was the Prime Minister, I would have an external person to audit (the manifest) because there’ll be an independent perspective – you can’t audit your own work.

“But it is his wisdom to have it at the cabinet level – to show its significance,” he said.

He stressed the promises in the manifesto were not arbitrarily drafted, and had gone through a rigorous process.

He said the pledges were derived from public consultation, research firms and party consultation before being approved by the leadership of the respective parties as well as the Harapan presidential council.

“I think with the capable ministers that we have now, under the very capable stewardship of Mahathir and his Deputy Wan Azizah Wan Ismail, I think this is doable.

“If we set our mind and focus towards fulfilling the promises rather than being defensive, I think it’ll be better for us.“At the end of the day, end of the fifth year, assess us then. We should be able to fulfil most of it,” he said.

This interview was jointly conducted by NIGEL AW, NORMAN GOH and ZIKRI KAMARULZAMAN.

RELATED REPORTS

What’s the progress of Harapan’s 100-day pledges?

New M’sia, 100 days later: A look back at Harapan’s first 100 days in power

100 days under Harapan – whither the national economy?

10 promises in 100 days – monitoring Pakatan Harapan’s manifesto pledges

KJ: After 100 days, time for BN to stop harping on the manifesto

Mustafa defends Harapan ‘failure’ in fulfilling 100-day promises

 

 

Finance: Partying like it’s 1998


August 16, 2018

Partying like it’s 1998

by Paul Krugman

And now for something completely similar.

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Dr Paul Krugman in the United States
“How it works: stop the explosion of the debt ratio with some combination of temporary capital controls, to place a curfew on panicked capital flight, and possibly the repudiation of some foreign-currency debt. Meanwhile, get things in place for a fiscally sustainable regime once the crisis is over. If all goes well, confidence will gradually return, and you’ll eventually be able to remove the capital controls.
Malaysia did this in 1998; South Korea, with U.S. aid, effectively did something like it at the same time, by pressuring banks into maintaining their short-term credit lines.”–Dr Paul Krugman

For a while, those of us who devoted a lot of time to understanding the Asian financial crisis two decades ago were wondering whether Turkey was going to stage a re-enactment. Sure enough, that’s what seems to be happening.

Here’s the script: start with a country that, for whatever reason, became a favorite of foreign lenders, and experienced a large inflow of foreign capital over a number of years. Crucially, the debt thus incurred is denominated in foreign currency, not domestic (which is why the U.S., also a recipient of large inflows in the past, isn’t similarly vulnerable — we borrow in dollars).

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Dr. Jomo Kwame Sundaram in Malaysia

At some point, however, the party comes to an end. It doesn’t matter much what causes a “sudden stop” in foreign lending: it could be domestic events, like appointing your son-in-law to oversee economic policy, it could be a rise in U.S. interest rates, it could be a crisis in another country investors see as being similar to you.

Whatever the shock, the crucial thing is that foreign debt has made your economy vulnerable to a death spiral. Loss of confidence causes your currency to drop; this makes it harder to repay debts in foreign currency; this hurts the real economy and further reduces confidence, leading to a further decline in your currency; and so on.

The result is that foreign debt explodes as a share of GDP. Indonesia came into the ’90s financial crisis with foreign debt less than 60 percent of GDP, roughly comparable to Turkey early this year. By 1998 a plunging rupiah had sent that debt to almost 170 percent of GDP.

How does such a crisis end? If there is no effective policy response, what happens is that the currency drops and debt measured in domestic currency balloons until everyone who can go bankrupt, does. At that point the weak currency fuels an export boom, and the economy starts a recovery built around huge trade surpluses. (This may come as a surprise to Donald Trump, who appears to be levying punitive tariffs on Turkey as punishment for its weak currency.)

Is there any way to short-circuit this doom loop? Yes, but it’s tricky. What you need to reduce the costs of crisis is a combination of short-run heterodoxy and credible assurances of a longer-run return to orthodoxy.

How it works: stop the explosion of the debt ratio with some combination of temporary capital controls, to place a curfew on panicked capital flight, and possibly the repudiation of some foreign-currency debt. Meanwhile, get things in place for a fiscally sustainable regime once the crisis is over. If all goes well, confidence will gradually return, and you’ll eventually be able to remove the capital controls.

Malaysia did this in 1998; South Korea, with U.S. aid, effectively did something like it at the same time, by pressuring banks into maintaining their short-term credit lines. A decade later, Iceland did very well with a combination of capital controls and debt repudiation (strictly speaking, refusing to take public responsibility for the debts run up by private bankers).

Argentina also did quite well with heterodox policies in 2002 and for a few years after, effectively repudiating 2/3 of its debt. But the Kirchner regime didn’t know when to stop and turn orthodox again, setting the stage for the country’s return to crisis.

And maybe that example shows how hard dealing with this kind of crisis is. You need a government that is both flexible and responsible, not to mention technically competent enough to implement special measures and honest enough to carry out that implementation without massive corruption.

That, unfortunately, doesn’t sound like Erdogan’s Turkey. Of course, it doesn’t sound like Trump’s America, either. So it’s a good thing our debts are in dollars.

Dr Kua Kia Soong hits out at PH ‘flip-flops’ ahead of 100-day milestone


August 15, 2018

Dr Kua Kia Soong hits out at PH ‘flip-flops’ ahead of 100-day milestone

Suaram Adviser Kua Kia Soong also says Putrajaya appears more interested in playing the blame game than getting down to business.

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Dr Kua Kia Soong, prominent activist,former Isa detainee, and prolific analyst, today accused the Pakatan Harapan (PH) government of flip-flopping on a number of issues, just days before the administration led by Dr Mahathir Mohamad marks its first 100 days in power.

Giving the example of the Unified Examination Certificate (UEC), Kua Kia Soong asked why it would take five years to recognise it when PH had stated in its manifesto that it was ready to accept it. He said other issues included the oil royalty promised to East Malaysia and the abolition of highway tolls.

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In July, Mahathir announced in Parliament that Putrajaya would honour its promise to provide 20% royalty to petroleum-producing states. But he later clarified the statement, saying the 20% payment would be based on profit instead of royalty.

The Suaram Adviser said it was also unacceptable that local elections could only be held after three years. “Delaying reforms in unacceptable. A really important reform we want to see concerns the redistribution of wealth,” he added.

Dr. Kua was speaking at Suaram’s presentation of its report card for PH’s first 100 days in government.He said following the election, Putrajaya seemed more interested in playing the blame game than getting down to business.

“We read news of the missing goods and services tax (GST) money, yet there has been no movement. Have the Police or Attorney-General acted on it? We should be told what happened to the money within a week,” he said.

He also took issue with Tabung Harapan Malaysia, a fund established to help settle the country’s RM1 trillion debt, saying he could not accept “sob stories” related to the initiative.

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“It’s about the management of the economy to plug the leaks, not the piggy banks of little boys,” he said, referring to the story of a youth who donated his savings to the fund.

As for the government’s war on kleptocracy, Kua asked why authorities had yet to zoom in on former Sarawak chief minister Taib Mahmud, who was accused of corruption in the past.

“And why haven’t Mahathir and his children declared their assets?”

Demonizing State-Owned Enterprises


August 14, 2018

Demonizing State-Owned Enterprises

 

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Historically, the private sector has been unable or unwilling to affordably provide needed services. Hence, meeting such needs could not be left to the market or private interests. Thus, state-owned enterprises (SOEs) emerged, often under colonial rule, due to such ‘market failure’ as the private sector could not meet the needs of colonial capitalist expansion.

Thus, the establishment of government departments, statutory bodies or even government-owned private companies were deemed essential for maintaining the status quo and to advance state and private, particularly powerful and influential commercial interests.

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SOEs have also been established to advance national public policy priorities. Again, these emerged owing to ‘market failures’ to those who believe that markets would serve the national interest or purpose.However, neoliberal or libertarian economists do not recognize the existence of national or public interests, characterizing all associated policies as mere subterfuges for advancing particular interests under such guises.

Nevertheless, regardless of their original rationale or intent, many SOEs have undoubtedly become problematic and often inefficient. Yet, privatization is not, and has never been a universal panacea for the myriad problems faced by SOEs.

Causes of inefficiency

Undoubtedly, the track records of SOEs are very mixed and often vary by sector, activity and performance, with different governance and accountability arrangements. While many SOEs may have been quite inefficient, it is crucial to recognize the causes of and address such inefficiencies, rather than simply expect improvements from privatization.

First, SOEs often suffer from unclear, or sometimes even contradictory objectives. Some SOEs may be expected to deliver services to the entire population or to reduce geographical imbalances. Other SOEs may be expected to enhance growth, promote technological progress or generate jobs. Over-regulation may worsen such problems by imposing contradictory rules.

Privatization has never been a universal panacea. One has to understand the specific nature of a problem; sustainable solutions can only come from careful understanding of the specific problems to be addressed. To be sure, unclear and contradictory objectives – e.g., to simultaneously maximize sales revenue, address disparities and generate employment — often mean ambiguous performance criteria, open to abuse.

Typically, SOE failure by one criterion (such as cost efficiency) could be excused by citing fulfillment of other objectives (such as employment generation). Importantly, such ambiguity of objectives is not due to public or state ownership per se.

Second, performance criteria for evaluating SOEs — and privatization — are often ambiguous. SOE inefficiencies have often been justified by public policy objectives, such as employment generation, industrial or agricultural development, accelerating technological progress, regional development, affirmative action, or other considerations.

Ineffective monitoring, poor transparency and ambiguous accountability typically compromise SOE performance. Inadequate accountability requirements were a major problem as some public sectors grew rapidly, with policy objectives very loosely and broadly interpreted.

Third, coordination problems have often been exacerbated by inter-ministerial, inter-agency or inter-departmental rivalries. Some consequences included ineffective monitoring, inadequate accountability, or alternatively, over-regulation.

Hazard

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Moral hazard has also been a problem as many SOE managements expected sustained financial support from the government due to weak fiscal discipline or ‘soft budget constraints’. In many former state-socialist countries, such as the Soviet Union and Yugoslavia, SOEs continued to be financed regardless of performance.

Excessive regulation has not helped as it generally proves counter-productive and ultimately ineffective. The powers of SOEs are widely acknowledged to have been abused, but privatization would simply transfer such powers to private hands.

Very often, inadequate managerial and technical skills and experience have weakened SOE performance, especially in developing countries, where the problem has sometimes been exacerbated by efforts to ‘nationalize’ managerial personnel.

Often, SOE managements have lacked adequate or relevant skills, but have also been constrained from addressing them expeditiously. Privatization, however, does not automatically overcome poor managerial capacities and capabilities.

Similarly, the privatization of SOEs which are natural monopolies (such as public utilities) will not overcome inefficiencies due to the monopolistic or monopsonistic nature of the industry or market. The key remaining question is whether privatization is an adequate or appropriate response to address SOE problems.

Throwing baby out with bathwater

SOEs often enjoy monopolistic powers, which can be abused, and hence require appropriate checks and balances. In this regard, there are instances where privatization may well be best. Two examples from Britain and Hungary may be helpful.

The most successful case of privatization in the United Kingdom during the Thatcher period involved National Freight, through a successful Employee Stock Ownership Plan (ESOP). Thus, truck drivers and other staff co-owned National Freight and developed personal stakes in ensuring its success.

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In Hungary, the state became involved in running small stores. Many were poorly run due to over-centralized control. After privatization, most were more successfully run by the new owners who were previously store managers. Hence, there are circumstances when privatization can result in desirable outcomes, but a few such examples do not mean that privatization is the answer to all SOE problems.

Privatization has never been a universal panacea. One has to understand the specific nature of a problem; sustainable solutions can only come from careful understanding of the specific problems to be addressed.

 

Dr. 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.

 

 

NY Times Book Review: Looking Back@Crash of 2008


August 11, 2018

CRASHED

By Dr. Fareed Zakaria

How a Decade of Financial Crises Changed the World
By Adam Tooze
706 pp. Viking. $35.

Steve Bannon can date the start of the Trump “revolution.” When I interviewed him for CNN in May, in Rome, he explained that the origins of Trump’s victory could be found 10 years ago, in the financial crisis of 2008.

“The implosion of those world capital markets has never really been sorted out,” he told me. “The fuse that was lit then that eventually brought the Trump revolution is the same thing that’s happened here in Italy.” (Italy had just held elections in which populist forces had won 50 percent of the vote.)

Adam Tooze would likely agree. An economic historian at Columbia University, he has written a detailed account of the financial shocks and their aftereffects, which, his subtitle asserts, “changed the world.”

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If journalism is the first rough draft of history, Tooze’s book is the second draft. A distinguished scholar with a deep grasp of financial markets, Tooze knows that it is a challenge to gain perspective on events when they have not yet played out. He points out that a 10-year-old history of the crash of 1929 would have been written in 1939, when most of its consequences were ongoing and unresolved. But still he has persisted and produced an intelligent explanation of the mechanisms that produced the crisis and the response to it. We continue to live with the consequences of both today.

CreditTyler Comrie; Photograph courtesy of GSO/Getty Images

As is often the case with financial crashes, markets and experts alike turned out to have been focused on the wrong things, blind to the true problem that was metastasizing. By 2007, many were warning about a dangerous fragility in the system. But they worried about America’s gargantuan government deficits and debt — which had exploded as a result of the Bush administration’s tax cuts and increased spending after 9/11. It was an understandable focus. The previous decade had been littered with collapses when a country borrowed too much and its creditors finally lost faith in it — from Mexico in 1994 to Thailand, Malaysia and South Korea in 1997 to Russia in 1998. In particular, many fretted about the identity of America’s chief foreign creditor — the government of China.

Yet it was not a Chinese sell-off of American debt that triggered the crash, but rather, as Tooze writes, a problem “fully native to Western capitalism — a meltdown on Wall Street driven by toxic securitized subprime mortgages.”Tooze calls it a problem in “Western capitalism” intentionally. It was not just an American problem. When it began, many saw it as such and dumped the blame on Washington.

In September 2008, as Wall Street burned, the German Finance Minister Peer Steinbruck explained that the collapse was centered in the United States because of America’s “simplistic” and “dangerous” laissez-faire approach. Italy’s finance minister assured the world that its banking system was stable because “it did not speak English.”

 

In fact this was nonsense. One of the great strengths of Tooze’s book is to demonstrate the deeply intertwined nature of the European and American financial systems. In 2006, European banks generated a third of America’s riskiest privately issued mortgage-backed securities. By 2007, two-thirds of commercial paper issued was sponsored by a European financial entity.

The enormous expansion of the global financial system had largely been a trans-Atlantic project, with European banks jumping in as eagerly and greedily to find new sources of profit as American banks. European regulators were as blind to the mounting problems as their American counterparts, which led to problems on a similar scale. “Between 2001 and 2006,” Tooze writes, “Greece, Finland, Sweden, Belgium, Denmark, the U.K., France, Ireland and Spain all experienced real estate booms more severe than those that energized the United States.”

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Credit Sonny Figueroa/The New York Times

 

But while the crisis may have been caused in both America and Europe, it was solved largely by Washington. Partly, this reflected the post-Cold War financial system, in which the dollar had become the hyper-dominant global currency and, as a result, the Federal Reserve had truly become the world’s central bank. But Tooze also convincingly shows that the European Central Bank mismanaged things from the start.

The Fed acted aggressively and also in highly ingenious ways, becoming a guarantor of last resort to the battered balance sheets of American but also European banks. About half the liquidity support the Fed provided during the crisis went to European banks, Tooze observes.

Before the rescue and even in its early stages, the global economy was falling into a bottomless abyss. In the first months after the panic on Wall Street, world trade and industrial production fell at least as fast as they did during the first months of the Great Depression. Global capital flows declined by a staggering 90 percent. The Federal Reserve, with some assistance from other central banks, arrested this decline. The Obama fiscal stimulus also helped to break the fall.

 

Tooze points out that almost all serious analyses of the stimulus conclude that it played a significant positive role. In fact, most experts believe it ended much too soon. He also points out that large parts of the so-called Obama stimulus were the result of automatic government spending, like unemployment insurance, that would have happened no matter who was president. And finally, he notes that China, with its own gigantic stimulus, created an oasis of growth in an otherwise stagnant global economy.

The rescue worked better than almost anyone imagined. It is worth recalling that none of the dangers confidently prophesied by legions of critics took place. There was no run on the dollar or American treasuries, no hyperinflation, no double-dip recession, no China crash.

American banks stabilized and in fact prospered, households began saving again, growth returned slowly but surely. The governing elite did not anticipate the crisis — as few elites have over hundreds of years of capitalism. But once it happened, many of them — particularly in America — acted quickly and intelligently, and as a result another Great Depression was averted. The system worked, as Daniel Drezner notes in his own book of that title.

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A trader on the floor of the New York Stock Exchange in February 2009. CreditJames Estrin/The New York Times

 

But therein lies the unique feature of the crash of 2008. Unlike that of 1929, it was not followed by a Great Depression. It was not so much the crisis as the rescue and its economic, political and social consequences that mattered most. On the left, the entire episode discredited the market-friendly policies of Tony Blair, Bill Clinton and Gerhard Schroeder, disheartening the center-left and emboldening those who want more government intervention in the economy in all kinds of ways. On the right, it became a rallying cry against bailouts and the Fed, buoying an imaginary free-market alternative to government intervention.

Unlike in the 1930s, when the libertarian strategy was tried and only deepened the Depression, in the last 10 years it has been possible for the right to argue against the bailouts, secure in the knowledge that their proposed policies will never actually be implemented.

Bannon is right. The crash brought together many forces that were around anyway — stagnant wages, widening inequality, anger about immigration and, above all, a deep distrust of elites and government — and supercharged them. The result has been a wave of nationalism, protectionism and populism in the West today. A confirmation of this can be found in the one major Western country that did not have a financial crisis and has little populism in its wake — Canada.

The facts remain: No government handled the crisis better than that of the United States, which acted in a surprisingly bipartisan fashion in late 2008 and almost seamlessly coordinated policy between the outgoing Bush and incoming Obama administrations. And yet, the backlash to the bailouts has produced the most consequential result in the United States.

Tooze notes in his concluding chapter that experts are considering the new vulnerabilities of a global economy with many new participants, especially the behemoth in Beijing. But instead of a challenge from an emerging China that began its rise outside the economic and political system, we are confronting a quite different problem — an erratic, unpredictable United States led by a president who seems inclined to redo or even scrap the basic architecture of the system that America has painstakingly built since 1945.

How will the world handle this unexpected development? What will be its outcome? This is the current crisis that we will live through and that historians will soon analyze.

Dr. Fareed Zakaria is a CNN anchor, a Washington Post columnist and the author of “The Post American World.”

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A version of this article appears in print on , on Page 1 of the Sunday Book Review with the headline: The Aftershocks.

Cosy Relations with China (PRC) led to Pakatan Harapan’s GE-14 Victory


August 6, 2018

Cosy Relations with China (PRC) led to Pakatan Harapan’s GE-14 Victory

by Dr. Adam Leong Kok Wey

“Domestic voices matter in Malaysia’s foreign policy decision-making. In a world of mass open communication via the internet and wide choices of alternative news and information sources, the Malaysian public are exposed to international affairs as well as the strategic logic behind these issues. The Malaysian election results may signify the end of elite foreign policymaking in Malaysia and augur a new era in which Malaysia’s foreign policy will hopefully be shaped and influenced by domestic views and concerns.”–Dr. Adam Leong

http://www.eastasiaforum.org/2018/07/28/foreign-policy-concerns-swayed-malaysias-voters/

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Malaysia’s recent election on 9 May 2018 saw a dramatic result — the incumbent Barisan Nasional ruling coalition that had ruled Malaysia for 61 years crumbled, and Pakatan Harapan, a coalition of opposition parties, emerged victorious. One of the numerous reasons why the ruling party lost in the elections is that Malaysia’s foreign policy was perceived by a large segment of its people to be too cosy to China.

Malaysia’s foreign policy decision-making has long been the purview of the elite leadership with most final decisions being made by the Prime Minister. As leader of Barisan Nasional, Najib Razak wanted Malaysia’s foreign policy to involve working more closely with China — especially in drawing investment from the country. This resulted in massive Chinese investment in infrastructure and transport projects and large loans by China to Malaysia to co-develop these projects. For its part, China sees Malaysia’s geographical position as an important link in its Belt and Road Initiative, which is key for China to promote its strategic interests and project its power on a global scale.

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One example is the East Coast Rail Line project, which will link Malaysia’s west coast with the east coast at a cost of RM55 billion (US$13.6 billion). In November 2016, Malaysia awarded the contract to build the project to the state-owned China Communications Construction Company with the cost financed by a loan from the same firm. (The project was suspended in July 2018 shortly after Najib’s May election defeat.) Another example is Iskandar Malaysia, a township development project established in November 2006 in Johor where large chunks of property have been bought by Chinese migrants. This has caused much fear and consternation among locals around the influx of foreigners into the state.

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Malaysia’s warm relations with China under Najib had also put Malaysia’s claims and interests in the South China Sea on a back burner. China’s claims in the South China Sea overlap with some maritime areas of Malaysia’s exclusive economic zone and Malaysia’s own territorial claims. Malaysia had been muted on China’s moves in the South China Sea leading to some uneasiness among Malaysians around China’s growing assertiveness in the contested waters, which will have lasting strategic consequences for Malaysia.

These factors created worries among large segments of the Malaysian population — including its ethnic Chinese population — about emerging security and economic risks posed by China. Fears that China will control regional politics as well as Malaysia’s indebtedness to China combined to create strong domestic opposition to the ‘too-warm’ ties with China. An often-cited example of Malaysians’ apprehensions about over-dependence on China is Sri Lanka’s failure to service its debt with China, resulting in the 99-year leasing to China of the Hambantota Port.

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Malaysians decided that foreign policy decision-making had to change. The massive electoral losses incurred by the Barisan Nasional on 9 May plausibly reflect the rejection of Malaysia’s foreign policy by its people and the need to re-orient Malaysia’s future decision-making processes to account for the views of its domestic population.

Domestic voices matter in Malaysia’s foreign policy decision-making. In a world of mass open communication via the internet and wide choices of alternative news and information sources, the Malaysian public are exposed to international affairs as well as the strategic logic behind these issues. The Malaysian election results may signify the end of elite foreign policymaking in Malaysia and augur a new era in which Malaysia’s foreign policy will hopefully be shaped and influenced by domestic views and concerns.

Dr Adam Leong Kok Wey is an Associate Professor in Strategic Studies and the Deputy Director of Research with the Centre for Defence and International Security Studies at the National Defence University of Malaysia.