Najib’s slow death on Myanmar Times

February 21, 2018

Najib’s slow death

Living under the tawdry and sinking regime of Prime Minister Najib Razak must seem to Malaysians like death by treacle.

They are drowning in a gluey black sea of venality the likes of which has not been seen in this region since the days of President Ferdinand Marcos in the Philippines.

The mounting litany of shameful episodes that have riven that nation all appear to be traceable to the hapless PM, who is also the head of the dominant political party, the United Malays National Organisation.

Things are so bad that last week the UMNO-owned newspaper, Utusan Malaysia, carried an outrageous editorial that tried to exonerate Najib and shift the blame elsewhere. It failed, of course, because it was arguing against facts that indicate to all Malaysians that Najib is steadily sinking into the treacly pit of corruption and maladministration into which he has plunged his country.

If you think this is over the top, just consider a few of the more damning indictments against the PM and his band of gangsters, cheats and philanderers.

First, there are the missing billions of taxpayers’ money. It is hard to truly comprehend the full magnitude of this gigantic, nepotistic malfeasance, and even the illustrious New York Times took three pages to try to do it.

Suffice to say that Najib’s stepson, Riza Aziz, the offspring of the PM’s second wife Rosmah, is the man apparently responsible for most of the woes brought about by this debacle – otherwise known as 1MDB.

The initials stand for 1Malaysia Development Berhad, a sovereign wealth fund that has lost billions due to corruption and mismanagement, and is still weighed down by massive nonperforming loans.

The fund appears to be almost entirely controlled by Najib, Aziz and a flamboyant Penang Chinese conman called Jho Low – no relation to Jennifer Lopez, though he mixes with Paris Hilton and other Hollywood starlets.

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Why and how? There is no clear answer, except to recall that Najib is under the sway of Rosmah Mansor, a shopaholic wrecking ball, who shrugs off ridicule and ignores how her actions thwart her husband’s premiership.

In truth, the personal damage to Najib is piffling compared to the disastrous effect the huge 1MDB losses are having on the already fragile Malaysian economy.

An opposition MP has called the fund fiasco “the mother of the mother of the mother of all scandals in the history of Malaysia”. He may be right. Certainly, there are already worries that if and when 1MDB collapses, the nation’s financial system may take a hit that will dwarf the effect of the Asian Financial Crisis in 1997.

And bear in mind that Malaysia’s resource-dependent economy is already in trouble due to the depressed price of its key exports, petroleum oil and palm oil.

Last month, Najib announced US$1.5 billion in spending cuts and said Malaysia’s economic growth would fall from 6 percent to between 4.5pc and 5.5pc this year.The economic woes have been compounded by diminishing political support at home.

In the last general election two years ago, Najib vowed to reverse the drop in votes that his UMNO-led coalition had witnessed under his predecessor, PM Abdullah Badawi.

It did not happen. His government ceded even more seats and lost four state assemblies and the overall popular vote to the opposition People’s Alliance, led by Anwar Ibrahim.

Since that chastening experience, Najib has clung onto the UMNO leadership by appeasing his key support base, the nation’s Malay-Muslim majority, and marginalising the minority Chinese and Indian communities.

This shocking move was his only option, or else he would have faced the same fate as Abdullah, who was elbowed out after his election failure by UMNO party men.

Concurrently, Najib has reversed his promise to dump the colonial-era Sedition Act, and instead applied it with increasing frequency against oppositionists, lawyers, journalists and academics.

Most recently, Anwar has been jailed for five years after a dubious sodomy conviction, while one of the nation’s popular cartoonists has been detained for drawing caricatures that lampoon the farcical Anwar trial.

Not only do these actions signal a premier running scared – as would be expected after the 1MDB catastrophe and his election setback – but they are grotesquely hypocritical.

Tarring Anwar with sodomy conveniently distracts attention from the fact that Najib, a notorious philanderer in his early days like most UMNO leaders, may be complicit in the murder of a Mongolian model.

The demise of this woman, the lover of the PM’s closest adviser and many Malaysians suspect also Najib’s mistress, is under investigation due to a $155 million kickback in an intertwined submarine deal negotiated when Najib was defence minister.

All of this led Utusan to issue its absurd editorial that – wait for it – blamed America for the country’s woes. It even accused Washington, which has criticised Anwar’s jailing, of copying the opposition leader’s behaviour.

According to Utusan, “The US wants to ‘sodomise’ our legal and judicial system, even though the majority of Malaysians agree with the court’s decision.” Well, that is a moot point. Certainly the voting pattern suggests most Malaysians would happily accept Anwar as their next PM.


“Don’t slander Rosmah over jet ride, Dr M told.”

February 20, 2018

Comments of an UMNO serf in a resurgent feudal society-“Don’t slander Rosmah over jet ride, Dr M told.

The UMNO Serf- Rizal Mansor

The Special Officer to the Prime Minister’s wife, Rizal Mansor, said it was regretful that a statesperson such as Dr Mahathir Mohamad would resort to slander Rosmah Mansor.

“How can a statesperson (like Mahathir) listen to and believe in such hearsay? As a statesperson, he should check and research facts before making accusations. “Don’t put political interests above laws and adab (civility) until you create slander,” Rizal said in a statement uploaded onto Umno Online today.

He was referring to a video clip that depicted Mahathir’s speech, where he criticised Rosmah for boarding a private jet, unaccompanied by her husband.

Is her conduct and extravagant lifestyle  not subject to public scrutiny? If she wants to avoid negative comment, she should stay as an ordinary housewife and  not be the First Lady of Malaysia.

Rizal reiterated his previous explanation that Rosmah’s tight schedule necessitated the government having to rent a private jet for her to receive an award in Istanbul on May 25, 2016, and return to Malaysia the next day.

Also used by King and Queen

Rizal also rubbished the claim that the Airbus ACJ319 A6-CJE corporate jet was hired for Rosmah’s use alone, explaining that it is also used by other dignitaries, such as the Yang di-Pertuan Agong and the Raja Permaisuri Agong.

“The jet was rented by the Malaysian government temporarily for the two-month period (May and June 2016) as a replacement for the ACJ320 9M-NAB jet that was being serviced at the time.”

Rizal also slammed Mahathir’s apparent attempt to paint the PM’s wife as “wasteful”, by countering the RM86 million jet rental figure, first brought up by PKR vice-president Rafizi Ramli based on his own calculations.

“The calculation for the RM86.4 million cost is not true at all and is intended to deceive the public. The calculation does not make any sense because Rafizi is taking the flight cost of RM60,000 an hour and multiplying it by 24 hours and 60 days.

“Of course the plane cannot fly 24 hours a day for two months,” he said.

Excess baggage

In his statement, Rizal also repeated his claim that the cargo hold of the government-chartered jet used was full of the Permata Seni group’s performance paraphernalia, and not Rosmah’s own luggage.

Rafizi had disputed this claim at the time, pointing out that Permata Seni’s performance at Istanbul’s Sabiha Gokcen International Airport took place before the jet touched down in the Turkish capital that day.

After using the “Plane Finder” application in 2016, Rafizi had revealed that Rosmah used a private jet for her trip to Istanbul. He took issue with the use of the private jet chartered from the Emirates airline, since she was accepting an award on behalf of the public-funded Permata.

“She has to answer this since she was the one who took the flight, and (Prime Minister) Najib Abdul Razak too has to answer because he has to be responsible for this,” he said at the time.

Rafizi had also questioned the need for the government to charter another private jet when it already has three existing aircraft. He had explained that the government has another ACJ319, the 9M-NAA, which was bought several years earlier, besides the ACJ320 9M-NAB under service that the chartered jet was supposed to replace.

Rafizi also highlighted that the government had announced that the ACJ320 9M-NAB was purchased to replace the BBJ737-700 M53-01 – which he found was still in active use, despite being advertised as being on sale in August 2015.

“I urge Najib, as Minister responsible in managing all of the government’s jets, to explain why BBJ737-700 has yet to be sold and why it is still being used, as this involves the rakyat’s money,” he had said.

2018: Year of Change for Better or Worse?

December 31, 2017

2018: Year of Change for Better or Worse?

by Dr. Lim Teck Ghee

As the year comes to an end the latest press statements from two civil society organizations – the National Association of Patriots ( NPA or Persatuan Patriot Kebangsaan) and G25 – provide renewed hope that the struggle for the freedoms and values of a robust democratic system will continue with key stakeholders providing overdue support.

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With scandals in his bag, Najib Razak needs to retain power and maintain the status quo. Keep praying Mr. Prime Minister.

For too long most Malaysians – outside the political arena who are well positioned to resist the authoritarian political and religious forces seeking to kill off moderate positions on regressive and illiberal socio-economic policies and programs – have remained quiet.

They have been spectators or have stood outside the political process hoping that the long entrenched ruling government is truly committed to building a cohesive and inclusive nation where no ethic, religious, geographical or class grouping is denied their rightful entitlements. They have also expected the BN to be consistent in pursuing a genuine pluralism that can be the foundation stone for peace and progress in our multi-racial society.

Many among our elite have also remained passive in the belief that opportunistic and repressive, and what constitute the more dangerous and real, not imagined, anti-national forces can be countered by institutional stake players located in the executive and legislative branches; as well as by the other constitutional checks and balances.

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That these two organizations – NPA and G25 – whose service and loyalty to the nation is irrefutable and unimpeachable have come out openly on developments which the government is in denial or prefers to draw a curtain of silence over reveals the deep concern and despair of respected armed forces and civil service leaders with current developments; and their lack of faith that the BN leadership is up to the task of steering the nation in the right direction to a better future.

Losers of the NEP and Religious Extremism    

The NPA’s subject of concern is the New Economic Policy and its successor policies, and their impact on the ethnic composition of the armed forces. Calling on the government to increase the recruitment of non-Malays by 10 per cent annually, the NPA statement explained that it was giving its views as truthfully as possible on “some of these issues that are ultra-sensitive.”

In its opinion, a policy favoring Malays in promotion and discriminating against non-Malays has made the latter feel demoralized and marginalized. Coupled with an increasing Islamic culture, this has negatively affected esprit-de-corps and comradeship in multi-racial military units.

According to NPA President Brigadier-General (Rtd) Mohd Arshad Raji Arshad these factors have not only affected the military but also the police force and other public service organizations.

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3 Penyamun Tarbus with medals

BG Arshad noted that “the problems faced today are an outcome of the policies and decisions of our government of the past few decades … The problem is endemic, a cause-and-effect of the ‘unwritten’ rules and regulations of the past.”

He pointed out that “to solve the problem, we have to first recognize the problem. The intention here is not fault finding, rather to fully comprehend the grievances from the perspectives of the non-Malays, and help those in position make decisions for the betterment of our country.”

A critical but balanced and rationally-based independent position can be similarly seen in the statements of G25 on the socio-economic and religious controversies that have beset the nation in the last few years.

In its statement on the latest controversies relating to the influence of political Islamic ideology in the country and the effort by Malaysian Islamic Research Strategic Institute (Iksim), the government-supported Islamic think-tank, to censure and punish University of Malaya Professor Shad Saleem Faruqi  and G25 member, Noor Farida, for their views on religious radicalism,  G25 has noted that while it “recognises the fundamental rights of individuals and Islamic activists to advocate their beliefs of political Islam”, government officials and leaders need to reassure the public that the government does not agree with such views as they are contrary to the intent and purpose of the Constitution and the Rukunegara.

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To G25, it is “when the government leaders keep silent and pretend not to hear that the public gets worried whether the government is using religion for its own politics. It’s the official silence and apparent acquiescence that make locals and foreigners get the idea there is radicalisation of Islam in Malaysia.”

Standing up for all Malaysians

What is especially encouraging about the statements by these two Malay dominated organizations is not simply the commitment to what G25 describes as a “national ideology of tolerance and respect for the diversity and differences among Malaysians”. It is also their willingness to stand up for the rights and freedoms of “other” Malaysians.

One response by a Patriot member to criticism by the Defence Minister of the press statement of BG Arshad provides comfort that even if 2018 turns out badly for moderate and progressive minded Malaysians on the political and religious front, there will always be our true patriots to fall back upon.

This is what Major Mior Rosli wrote in his reply. It provides such a contrast to the saccharin sweet, vacuous and meaningless New Year messages that will soon flood our print media from the PR offices of the country’s political leaders.  His entire note should be required reading for all young Malaysians and those of us who have become cynical about developments in the nation:

“We, the veterans Armed Forces Officers and the ex-senior police officers are the real Patriots. More Patriotic than any of you, “power and kleptocracy” crazy politicians. Don’t ever belittle us. If there is a war to defend the soil, we will be the second or third liners behind the regular forces to defend this country. Please don’t mess us up with your political dreams. (capitals and exclamation marks omitted).”

Jomo: Whither the Malaysian economy ?

October 17, 2017

Jomo: Whither the Malaysian economy under Najib Razak?

Image result for Finance Minister Najib Razak and the National Debt
Malaysia’s Worst Finance Minister Najib Razak–Fiscal Mess, Heavily in Debt and Lowest Reserves in Asia.

This interview with economist Jomo Kwame Sundaram, former Assistant Secretary-General for Economic Development at the United Nations, was conducted in August for publication in the run-up to the country’s next Budget for 2018 due to be announced next Friday.

Developed country status

Question: Malaysia is close to achieving developed country status and is growing at a reasonable pace. Why are you concerned then?

Jomo: Becoming a developed country involves much more than achieving high-income status. But even by reducing ‘developed country’ status to becoming a ‘high-income’ country, we are not quite there unless we resort to statistical manipulation, e.g., by using 2013 exchange rates, or by ignoring about a third of the labour force who are ‘undocumented’ foreign workers.

For example, the ringgit declined from RM3.2 against the US dollar in 2014 to almost RM4.5 before recovering to the current RM4.2! But then we continue to use the old exchange rate or purchasing power parity (PPP) to pretend that we are almost there. The only people we are cheating is ourselves.

Also, if we continue to grossly underestimate the number of foreign workers in the country, then the denominator for calculating per capita income goes down. Similarly, by excluding the lowest paid foreign workers, income inequality has been declining when their inclusion may give a different picture. Thus, we can reach supposed high-income status more quickly if we pretend there are only one or two million foreign workers, when even the minister admitted last year to about 6.7 million!

Seven million, mainly undocumented foreign workers in Malaysia comes to over a third of the country’s total labour force. Many of them work and live in far worse conditions than the worst-off Malaysian workers. We are thus dependent on a huge underclass, largely foreign, whom we are in denial about.

New Economic Model

What do you think of Prime Minister Najib Razak’s New Economic Model?

Jomo: Let us be clear about this. The New Economic Model, or NEM, is really a wish-list of economic reforms desired from an essentially neo-liberal perspective. That does not mean it is all good or all bad. It contains some desirable reforms, long overdue due to the accumulation of excessive, sometimes contradictory regulations and policies.


Although the NEM made many promises and raised expectations, most observers would now agree that it has rung quite hollow in terms of implementation despite its promising rhetoric. As we all know, the NEM was dropped soon after it was announced for political reasons, and has never been the new policy framework it was expected to be.

Turning to actual policy initiatives, to the current administration’s credit, it accepted the minimum wage policy and BR1M (Bantuan Malaysia 1Malaysia) idea, both long demanded by civil society organisations, and supported by many, mainly opposition parties. The minimum wage policy has probably been far more important than BR1M in improving conditions for low-income earners.

Premature deindustrialisation

The contribution of manufacturing to growth and employment has been declining in this century. Yet, you seem to be nostalgic for industrialisation when the leadership wants to move to tertiary activities.

Jomo: Sadly, instead of acknowledging the problem, ‘premature deindustrialisation’ is being cited as proof of Malaysia being developed although services currently account for most job retrenchments.

Indeed, Malaysia has been deindustrialising far too early, even before developing diverse serious industrial capacities and capabilities beyond refining palm oil and so on. We have abandoned the past emphasis on industrialisation, but have not progressed sufficiently to more sophisticated, higher value-added industries.

In Japan, South Korea and China, policies to nurture industrialists and other entrepreneurs to become internationally competitive, enabled these countries to grow, industrialise and transform themselves very rapidly.

We are suffering great illusions if we think we can leapfrog the industrial stage and go straight to services. We should not try to emulate Hong Kong because we are a different type of economy. Even Singapore has not gone the Hong Kong way and continues to try to progress up the value chain in terms of industrial technology.

We need to stop blindly following policies espoused by international institutions. GST (Goods and Services Tax) is a variant of value-added taxation, long promoted by the IMF (International Monetary Fund). To accelerate progress, we need to develop better understanding of the Malaysian economy – of its real strengths and potential, rather than assuming that the current mantra in Washington is correct, let alone relevant.

Middle-income trap

According to the World Bank and others, Malaysia is stuck in a middle-income trap. The argument is that the NEM as well as financial services development are needed to get out of it.

Jomo: The idea of a ‘middle-income trap’ is due to Latin American and other countries uncritically following Washington Consensus prescriptions promoted by the Bank and the IMF. The promise is that following their prescriptions would lead to development.

Key elements of our own ‘middle-income trap’ are actually of our own making, e.g., by giving up so quickly on industrialisation. The prescriptions imagine we can somehow leap-frog to accelerate development without making needed reforms.


The NEM and current official development discourse emphasise modern services, especially financial services, for future growth. But why would investors want to come here rather than, say, Singapore? If they want lower costs, there are other locations.

To offer tax breaks or loopholes, or to make Malaysia a tax haven, the question again is why come here rather than Singapore.

And how much has the national economy really benefited from the Labuan International Offshore Financial Centre? Do we need to keep making the same errors?

Looking at other international financial centres, it is not clear that it will be a net plus for the country, and provide the basis for sustainable development suitable for an economy like ours. Remember, we are no Hong Kong.

Historically, we have been heavily dependent on foreign direct investment, not for want of capital, but for access to markets, technology and expertise. To make matters worse, over the last decade, foreign investors have taken a growing share in publicly listed companies, helped by the falling ringgit in recent years.

Arguably, foreign ownership of the Malaysian economy has never been as high since the 1970s. As large corporations are increasingly dominant, they have often crowded out small and medium-sized enterprises (SMEs) and other Malaysian firms.

Macroeconomic management

In his recent book, Dr Bruce Gale (author of ‘Economic Reform In Malaysia: The Contribution Of Najibnomics’) has praised current macroeconomic management.

Jomo: Well, Gale is a political consultant and needs to ‘cari makan’. He is not a serious macroeconomist the last time I checked, but should nonetheless be taken seriously because he reminds us that well-managed ‘public relations’ influence market and public sentiment, including credit and other ratings. He heaps praise on ‘conventional wisdom’ which remains very influential, even if wrong.

Gale’s book reminds us that ‘creative accounting’, involving the transfer of debt and liabilities to state-owned enterprises or government-linked companies, has enabled the government to limit the growth of mainly ringgit-denominated federal government debt by rapidly expanding federal government-guaranteed ‘contingent liabilities’.

His defence and justification for GST ring quite hollow as his premise is that the middle class has been evading income tax, whereas it is mainly the rich who have successfully done so, whether legally or otherwise.

Although he has been writing on Malaysia for over three decades, he appears to have selective amnesia, only giving credit to the prime minister and his late father, whom no one would grudge, while ignoring other prime ministers and finance ministers, in line with the new official narrative.

Malaysians worse off?

Earlier, you acknowledged that Malaysian economic growth has continued, albeit at a lower rate, over the last two decades. Yet, you also argue that Malaysians may have become worse off in recent years. That sounds contradictory.

Jomo: Moderate economic growth has continued since the 1997-1998 financial crisis. More recently, this has been partly due to foreign financial inflows, helped by unconventional monetary policies in OECD economies.

Between 2012 and 2014, most people, especially low-income earners, became better off, thanks to the introduction of the minimum wage, continued ‘full employment’ and higher commodity prices.

Since then, commodity prices have fallen, unemployment has been rising (especially for youth), the GST was introduced, and consumer confidence has fallen lower than during the 1997-1998 or 2008-2009 financial crises.

However, consumer sentiment in Malaysia has been negative for some time according to CLSA and MIER (Malaysian Institute of Economic Research). Indeed, according to Nielsen, the international polling company, it has been poor since 2013, and is now the lowest in Southeast Asia.

Food prices have generally continued rising, as transport charges – for tolls, trains, etc. – have been increasing again, with floating petrol prices. Meanwhile, lower commodity prices and climate change have reduced many farm incomes.

Official unemployment has gone up from 2.9% in 2014 to 3.5% in 2016, still commendably low, although there are concerns about high youth unemployment, especially among the tertiary educated.

Retrenchments have been worst for services, casting doubt on future employment prospects as the authorities rely increasingly on services for growth and jobs. With unemployment low, but rising, wage growth has slowed after the initial introduction of the minimum wage, while real incomes have been hit by higher prices and taxes.

Wage depression

You seem to imply that Malaysian wages have been artificially lowered.

Jomo: Malaysians, in general, have higher incomes now than before. However, official numbers are misleading as we do not account for the massive presence and contribution of foreign labour, especially undocumented immigrant workers.

Their status has also served to depress wages for low-income Malaysian workers. Not surprisingly then, labour’s share of national income has gone down relatively.

This decline is not due to declining labour productivity, even if that may be the case. After all, higher labour productivity does not automatically raise workers’ incomes. Prevailing low wages retard technical change which would, in turn, raise productivity.

Thus, the unofficial low wage policy stands in the way of labour-saving innovation, such as mechanical harvesting, so necessary for development. We need a medium-term development strategy far less reliant on cheap foreign labour.

Consequently, wages and living conditions are too low, especially in agriculture. And even smallholder agriculture has been neglected by officialdom in Malaysia for some time, especially after Pak Lah’s (Abdullah Ahmad Badawi’s administration.

Fighting a jihad against middlemen was not only thinly disguised misinformed and misguided stunt intended to score ‘ethno-populist’ points, but also irrelevant to addressing contemporary challenges.

Shifting tax burden

How have recent tax reforms affected Malaysian households?

Jomo: Following the introduction of the GST in April 2015, tax revenue from households increased from RM42 billion in 2014 to RM67 billion in 2016, with GST more than doubling the contribution of indirect tax from RM17 billion to RM39 billion.

At the same time, income tax revenue has risen modestly from RM24 billion in 2014 to RM28 billion in 2016. On average, Malaysian households paid taxes of RM5,600 each, more than ever before.

Meanwhile, government subsidies and assistance have declined, falling from RM43 billion in 2013 to RM25 billion in 2016, with most food price subsidies removed between 2013 and 2016.

Inflation numbers

Official inflation numbers are low. Why does the public doubt official inflation numbers?

Jomo: There are many reasons why the public doubts official inflation numbers, but perhaps most importantly for the country’s open economy, the ringgit exchange rate dropped from RM3.2/USD to RM4.5/USD before recovering to RM4.2 recently.

People presume that a decline in the international value of the ringgit by about a quarter must surely have inflationary consequences.

The GST of 6% has been imposed since April 2015, directly affecting about half of household spending, with up to a fifth more indirectly affected. Again, this is expected to have affected the cost of living.

Price subsidies for sugar, rice, flour and cooking oil have been removed since 2013, raising prices by 14% to 31%. Meanwhile, transport – including fuel and toll – prices have risen on several fronts.

Hence, you can understand why people are sceptical.

Transformasi Nasional 2050 (TN50)

After announcing and then abandoning the New Economic Model, there is now much ado about an economic transformation agenda for 2050.

Jomo: The TN50 exercise has been broadly consultative, involving young people, which surely is a good thing. Unfortunately, as with BR1M, it has been used to mobilise political support for the regime before the forthcoming elections rather than open up a more inclusive debate about where the country is headed.

The conversation should be about where the country should go and how to get there. It is still unclear to what extent we are going beyond the usual feel-good, futuristic sounding clichés, but this should open up an important debate to give serious consideration to actually achieving the transformation.


The country is presently mired in a political crisis that has paralysed effective economic policymaking. Malaysia desperately needs a legitimate and consultative leadership to implement bold measures to take the country forward.

Many people in the country know what ails the economy, but we do not have the open discussion needed to really tackle the challenges the nation faces. For example, a free and independent media will not only improve the quality of public discourse, but also the legitimacy and acceptability of resulting public policy.

Yesterday: Jomo in defence of honest, constructive criticism

Malaysia: 2018 National Budget–Need for Greater Fiscal Discipline

October 5, 2017

Malaysia: 2018 National Budget–Need for Greater Fiscal Discipline

by T K

Image result for Najib as Finance Minister


In a couple of weeks, the 2018 national budget will be revealed and a peek into the options and challenges awaiting us, is in order.

Beware of Off-Budget Agencies

FIRST, the budget is not what it used to be. Increasingly there are expenditures and commitments outside the purview of the budget but their impact may eventually impinge on government finance. These are off-budget agencies of which the revenues, expenditures and debts should be tabulated and presented as addendum to the budget.

Keep Budget Deficits under Control

SECOND, in all likelihood, the 2018 budget will be another year of deficits. This means there will be new borrowings or sales of government assets to finance the deficit. New borrowings mean more accumulated debts and more debt service charges going forward. When more is provided for debt service charges, less will be available for other operating expenditures.

THIRD, most government revenue has almost reached its limits unless income and expenditure continue to grow. In recent times, the government has been relentless in its enforcement efforts to extract the maximum from individuals and business establishments. Similarly, the implementation of the GST is in full swing. It is doubtful that the government will be able to cover more loopholes and tax leakages/avoidance cases or to increase further the GST rates at this stage.

If revenues are limited, the government will not be able to offer new expenditure programmes unless it incurs more borrowing and debt.

FOURTH, most expenditure programmes are “locked in”, stifling the government’s ability to look at the new impetus. The government’s commitments toward BR1M, civil service salaries and benefits, pensions, and debt service charges will continue to grow. This will leave little room for the budget to meet new challenges lurking in the horizon.

Watch the Expenditure Side of Things

FIFTH, the government has looked at the revenue side by introducing new taxes and by enforcing stricter compliance of existing taxes. However, this trend can’t go on forever. It is time to look at the expenditure side of things.

The annual audit report has given more than sufficient information on wastage, inefficiency and abuse of government allocations and expenditures. Sometimes corruption is due to allocations being too lavishly handed out. If government departments and agencies have too much money, the tendency is to be careless with the expenditures.



Who is the de facto Minister of Finance– Najib Razak or Handbag Rosmah Mansor? How did she spend the funds  allocated for her signature project Permata?

Stringent and optimal budget allocations do not have to affect output or service to the people, as was commonly claimed. We only need those responsible to work harder and be more careful with the money.

The National Budget is not a Mundane or routine exercise

I think it would be a big mistake if we continue to look at the budget formulation as a mundane or routine exercise. Some of the trends are obviously unsustainable. Even if we start to reverse or correct the trends now, it may take us many years to restore sustainability.

TK Chua is an FMT reader.

National Unity in Malaysia

August 5, 2017

Between The Lines: National Unity in Malaysia

Channel News Asia

What are the challenges of forging national unity in a post-colonial, multi-ethnic state? From Kuala Lumpur, our panel of Malaysian experts evaluates the country’s progress, and outlines the tasks ahead.


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COMMENT: Today, Malaysia is a divided nation led by a corrupt Prime Minister. Before unity can be restored, Najib Razak and UMNO kleptocrats and their surrogates in Barisan Nasional (namely MCA, MIC and Gerakan) and PAS must be removed via democratic elections. Otherwise, it is all talk, which is at best purely speculative and futile. The country is in a political crisis. Malaysians know that, but they are not willing to openly admit that their country is a dysfunctional state heading towards a financial crisis due to the 1mdb scandal, and high national debt and a weakening economic fundamentals.–Din Merican

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