“Look East” to Japan –MAKE Agriculture exciting and profitable for an ageing Malaysia

November 20, 2018

“Look East” to  Japan –MAKE Agriculture  exciting and profitable for an ageing Malaysia –FIMA Group 2.0

Opinion

by Phar Kim Beng

http://www.malaysiakini.com

COMMENT | Between 1990 and 2020, the size of the Malaysian population increased by 80 percent. But in the same period, the number of people who aged also increased by a whopping 210 percent.

By 2050, 23.5 percent of the total population of Malaysia will be above 65 years of age. By then, Malaysia will be an aged society. But Malaysia could be there even sooner. By 2030, 15 percent of the Malaysian population will be above 60 years of age.

An ageing society is one where up to seven percent of its population is above the age of 65; whereas an aged society is one which has 15 percent of its population above this age range. Currently, Malaysia is moving towards being an ageing society by 2030, then an aged society by 2040. Time is of the essence given the size, and speed, of this problem.

Based on the statistics of 1990-2020, those above the age of 65, in other words, have increased at almost three times the rate of youths in Malaysia.

While it took France 115 years to become an aged society, Malaysia will experience it in 24 years. Invariably, learning from Japan is not an option now but a strategic necessity. Between 2019-2025, Japan will be in need of 500,000 skilled and semi-skilled workers a year.

This labour shortage is caused by ageing effects which Malaysia will continue to face in 2030 and 2050 respectively. Therefore, it is important to learn from Japan now, especially when switching to robotics./technology and knowledge

Indeed, Japan has long passed the stage of being an aged society as defined by the UN. By 2045, its total population will further shrink from 130 million to 90 million people. But is ageing affecting the agriculture and fishing industry in Japan? Not quite. Malaysia should learn from this Japanese experience.

Research has shown that in 2016, the average age of Japanese farmers was already at 66 years. Those in the fishing industries are aged between 60 and 65.

But Japanese agriculture has increasingly used robotics and mechanisation to make up for the shortfall of labour. The top five Japanese fishing companies are Maruha Nichiro, Nihon Suisan, Toyo Suisan and Kyokuyo.

Each of them is doing well and will continue to do well with strong support from the Japanese government.

Aquaponics, for example, can produce three times a higher yield than natural methods of farming. A greenhouse that uses robotics, and an automatic system of water sprinklers, can produce 30,000 to 50,000 tonnes of cabbage a day as opposed to 21,000 tonnes a day with just human labour

The Ministry of Agriculture and Agro-based Industries in Malaysia may often be overlooked by the national planners. It received the lowest budget allocation last month. This is wrong and must be reversed if Malaysia wants to be the top food producer country in Asia.

Adapting to ageing

This ministry, however, can reverse the process of benevolent neglect especially if it begins to take the Look East initiative as a powerful policy compass. Looking East, it can learn from Japan on how to attenuate the problems of ageing and agro-farming and fishing in the long run.

To be sure, while Malaysia does not show it, the country will become an aged society in 15 years, when fifteen percent of its population will be above the age of 65.

Thus, it is incumbent upon Malaysia, especially the Agriculture and Agro-based Industries Ministry to Look East in order to understand how Japan adapts to the process of becoming an ageing society.

There is no silver bullet solution to all of the above. But a strong and confident ministry should not be ruled out as a potential national saviour; this provided it can set up a unit to learn from the aged population of Japan even as Malaysia is ageing. Why is this important?

What about FIMA2.0?

First of all, the contribution of agriculture to the GDP of Malaysia has always remained between 8-11 per cent between 1957-2018. Japan has faced the same dilemma before and overcome it.

Agriculture in Malaysia is coming from a low base and contributes close to RM3.5 billion to the GDP every year. But this is also how and why the agricultural economy can grow further, according to the Agriculture and Agro-based Industries Minister. All one needs is tenacity, a concerted effort of modernisation and mechanisation, all of which are possessed by Japan in abundance.

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Furthermore, the establishment of AirAsia, a low-cost carrier, has expanded the reach of Malaysia to half of the world’s population within a span of six hours. The latter is critical. What was originally an impediment – a large Asian geography – is now a strategic opportunity.

If anything, it is important to learn from Japan in terms of how fast it can deliver its exotic fruits and food to almost half of Asia. Indeed how? Even with a low population farmer base of fewer than two million farmers in Japan in 2017, Japan has become adept at combining robotics, aquaponics and the use of farmland banks to improve its exports.

Nevertheless, farming and fishing are two planks of the industry that require careful planning at all stages. Malaysia is no exception. This is why it is better to learn from Japan now.

If the Agriculture and Agro-based Industries Ministry seems to feel that Malaysian agriculture might be facing the same problems in terms of an ageing society, shortage of labour and high migration to urban centres, it is high time that it has a Look East policy that draws from the inspiration of Japan.

In this sense, in an interview with Johan Jaffar in Sinar Harian last week, Salahuddin Ayub was right in affirming the importance of Look East, not just in focusing on the revival of Malaysian agriculture but also learning on other matters from Japan.

The sooner this ministry learns from Japan, including Japan’s industry and livestock, the sooner Malaysia will move away from the perpetual fear that the farmlands and industries will collapse.

Indeed, it would be wonderful to see Malaysia’s Agro Bank and farmland banks working side-by-side to make Japan and Malaysia the fruit basket of the whole of Asia ranging from tropical fruits to saltwater fish.

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PHAR KIM BENG is a multiple award-winning head teaching fellow on China and the Cultural Revolution at Harvard University.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.

The 5 Pluses of Japan

November 14, 2018 By Phar Kim Beng http://www.malaysiakini.com

COMMENT | There are three Japanese policies embedded into Malaysia. The Look East Policy is but one. Even then, Look East involves learning from the rapid economic developments of South Korea and China as well.

Thus, the Look East Policy alone, while necessary, is not sufficient to understand what Prime Minister Dr Mahathir Mohamad seems to want to achieve by making three trips to Japan over the last six months.

The other two policies are Malaysian Incorporated, abbreviated as Malaysian Inc, and the policy of sogososha (huge conglomerates).

Second, as a democracy, albeit an Asiatic one, Japan was in a position to explain to the rest of the G7 if the region was heading towards more democracy. To the degree the emphasis was not on democracy but business, Mahathir was hoping that the West and Japan could see Southeast Asia as a location where their foreign direct investments (FDI) could grow. Thus the ritualistic attendance at the Nikkei Asian Conference every June, which Mahathir attends without fail.

Third, Mahathir knows, from watching it intensely from the 1960s onwards, that Japan has capable acts of heroism. While the conversation threads can occasionally veer into “hara-kiri” or ritualistic suicide to atone for one’s shame, it has also headed in the direction of volitional resignation.

When Japan Inc or the government made any mistake, it was adept at either offering a contrite apology, changing its previous behaviour completely or resigning from the positions of responsibility.

Calling the Pacific War a war of necessity rather than a war of Japanese imperial aggression, for example, was enough to make any minister resign within a window of 24 hours. Japan has, and did, learn from the conflicts of the past which is why the Peace Constitution of Japan is something which Mahathir continues to admire, even suggesting as recently as August that it could help Malaysia avoid from being entrapped in any armed conflict.

Fourth, there is a high degree of congruence between the Japan of the past, especially Tokyo Olympics 1964, the first Olympics in Asia, and the impending Tokyo Olympics 2020, which is 18 months away from now. The key point is the Japanese fascination with making things, and the future, better.

Both are events to show case the future of Japanese technology within the context of what Asian technology can achieve. Invariably, this ranges from receiving the athletes at the major metropolises like Tokyo and Osaka to transferring them to other cities for various events. If in 1964 the focus was on bullet trains, in 2020 the key experiment would be driverless cars.

Not brittle nor delicate

Fifth, Japan is not often seen through the optics of strategic balance or to counter to the emergence of China or even North Korea.

When Mahathir became the Seventh Prime Minister in May 2018, he did not block Malaysia from reopening its mission in Pyongyang in North Korea. Yet North Korea, to this day, remains the arch enemy of Japan.

Nor did Mahathir try to pitch Japan against China, another strategic rival to Tokyo. The Mahathir doctrine is about clearing all warships from the South China Sea without fail.

By using Robert Kuok (on left in photo) as a conduit to get to know President Xi Jinping and Vice-President Wang QiShan of China, Mahathir knew he was using a practical “centrist” (and one who is Malaysian, too) to reach out to the top leadership in China.

He wasn’t trying to use someone who believes in transforming Japan into America’s “unsinkable aircraft carrier”, an expression used by former Prime Minister Yasuhiro Nakasone during Mahathir’s first tenure as the fourth Prime Minister of Malaysia (1981-2003).

By obviating the importance of the fifth aspect of the Japanese Malaysian relationship, Mahathir is indeed Looking East without being locked into any conflict with Japan’s nuclear and conventional arms rivals in the Northeast Pacific or the East China Sea.

In the months to come, the Japanese and Malaysian relationship can only strengthen when Anwar Ibrahim, the Prime Minister-in-Waiting, also exercises the same level of energy and pulsating pace to keep the two countries locked in a strategic embrace.

There are no signs to suggest that Anwar won’t keep up the tempo with Japan. First, Anwar is a big believer in the “Asian Renaissance,” a theme he explored in the book which he wrote in the 1990s.

He is also an ardent admirer of the Quranic scholarship and hermeneutics of the late Toshihiko Izutsu , one of the best scholars to have ever emerged from Japan.

 

 

Philosopher Toshihiko Izutsu

Anwar  is also a huge fan of Rabindranath Tagore, the Indian writer who was inspired by Japanese Pan Asianists like Ogawa Shumei and Tenshin Okakura at the start of the 20th century. The trio believed that Pan Asianism could be the ideological glue for the region.

Some of the think tanks of Anwar – such as the Institut Kajian Dasar (IKD) and the Institut Rakyat – have had good relationships with the Sasakawa Peace Foundation and the Nippon Foundation in Tokyo. Such links have been cultivated over the course of the last 25 years.

Their ties are not brittle and delicate. In fact, these organisations are keen on working with Mahathir and Anwar jointly. The future of Malaysia and Japan can only brighten when all Malaysians take Japan as seriously as the top two.

When Waseda University, the University of Tsukuba, the Toyo University, and potentially other Japanese education groups begin working closely with Malaysia, the Look East policy will then gain in ascendancy, creating room for similar entities from China and South Korea to do the same in Malaysia.

For now, the key is to send more workers, students, trainees, interns and even future leaders from Malaysia to Japan’s Graduate School of Policy Studies.

By 2020, the Japanese Prime Minister wants a total of 300,000 foreign students in Japan.

It would be an exceptional feat if one-third of them are Malaysians. That would be 100,000 Malaysians who understand contemporary Japan and how she competes with South Korea and China in a healthy manner.

These 100,000 Malaysians will help to move the country towards 2025 – the period when Mahathir believes Malaysia can be a developed country on par with Japan.

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PHAR KIM BENG is a former visiting scholar of the Japan Institute of International Relations in Tokyo.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.

 

Welcome to Malaysia’s Brave New World

November 5, 2018

by: John Berthelsen

https://www.asiasentinel.com/econ-business/malaysia-brave-new-world/

“Euphoria is dying off and bodies like Bersih, he continued, have started criticizing the new government. Many from civil society are keeping silent. “I suppose the saving grace is that Najib and his cohorts are gone. But that can’t console people forever.”_- J. Berthelsen

Six months into the rule of Malaysia’s new reform government, the bloom has started to fade as the Pakatan Harapan coalition attracts growing criticism while it seeks to find its feet against the political and economic debris left by the outgoing Barisan Nasional, driven from power on May 9 after six-plus decades in office.

The problems the government faces were starkly outlined on Nov. 1 by Finance Minister Lim Guan Eng in a marathon 14,000 word speech outlining the 2019 budget, in which he stated that the previous government, which he characterized as “kleptocratic,” had understated debt and liabilities by nearly 40 percent, rising to a stunning RM1.05 trillion (US$256.8 billion) in an effort to hide corruption, and that debts from the scandal-scarred 1Malaysia Development Bhd development fund could total as much as RM43.9 billion, not including RM7 billion in interest secretly paid on 1MDB debts using taxpayer money illegally.

To Malaysia’s credit, the frighteningly poisonous racial equation, in which ethnic Malays make up about half the population, the Chinese 23 percent and Indians 7 percent, with the rest split between expatriates and bumiputera tribes in East Malaysia, seems to have cooled markedly. The previous government’s attempt to use fundamentalists Islam to pound minorities has largely ceased although UMNO and the fundamentalist Parti Islam se-Malaysia continue to attempt to fan the flames. It remains to be seen what strains there are between the Chinese-dominated Democratic Action Party, Mahathir’s Parti Bersatu Pribumi, and Anwar Ibrahim’s moderate, urban Malay Parti Keadilan Rakyat – and what internal strains there are inside PKR.

The country is faced with a long series of monumental tasks – rebuilding a judiciary that was thoroughly corrupted by the previous government’s 61 years in power. The education system is a shamble, built on Malay privilege instead of academic achievement.  Lim called attention to educational shortcomings with a long series of measures allocating funds to lower-income students, upgrading failing schools and educational infrastructure, training and vocational education programs. Other sources say the government is being hamstrung to a certain extent by a civil service loyal to the previous government.

A series of murders including that in 2006 of Mongolian translator and party girl Altantuya Shaariibuu, AMBank founder Hussain Najadi and prosecutor Kevin Morais (pic above), all believed to be at the hands of high government officials, remain to be solved or even looked into.

The new government, caught by circumstances, has compounded its problems by campaigning against a deeply unpopular Goods and Services Tax (GST) implemented by the government of former Prime Minister Najib Razak, and then actually repealing it once in office, leaving a gigantic hole in government revenues.

‘–at the same time it has agreed to go along with Mahahir’s ill-conceived hobby horse, another national car project.

…That is despite 30-odd years of his previous ill-conceived hobby horse, the Proton national car, which cost the treasury billions of ringgit and billions more to consumers in lost opportunity costs from paying through the nose for heavily tariffed competitors. “- J. Berthelsen

It is seeking to fill the hole with a variety of piecemeal taxes – at the same time it has agreed to go along with Mahahir’s ill-conceived hobby horse, another national car project. That is despite 30-odd years of his previous ill-conceived hobby horse, the Proton national car, which cost the treasury billions of ringgit and billions more to consumers in lost opportunity costs from paying through the nose for heavily tariffed competitors.

“There was a lot of euphoria when Pakatan won the elections, but expectations were also very high,” said a prominent business source in Kuala Lumpur. “They have a small window. If they don’t deliver, that window will start closing.  But unfortunately, politicians will be politicians. They are inexperienced, and the euphoria is wearing off. So far, we have had no exciting government programs. New Malaysia is like Old Malaysia, minus Najib Razak and his 40 thieves.”

Najib and his wife Rosmah Mansor have both been arrested and are expected to go on trial next year. Hundreds of millions of dollars have been confiscated by Malaysian and US authorities although hundreds of millions more, perhaps billions, remain outside he government grasp.  Jewelry, handbags, watches, cash and other riches belonging to Rosmah that have been confiscated total at least US$273 million, putting her in a league even above Imelda Marcos, the wife of the late Philippine strongman Ferdinand Marcos, who held the public record for corruption. It remains to be seen if the Najibs surpass it.

The businessman’s assessment could be a bit pessimistic.  The government has abolished with capital punishment and the press appears to remain largely free despite reluctance on the part of the government to abolish a “fake news” bill pushed through at the last minute by the previous administration in an effort to muzzle pre-election critics.

But a sedition act used against the previous government’s foes remains on the books and has been used against critics. Civic organizations including Suaram have called attention to government inactions on a variety of rights issues. There is also concern on the part of the Coalition for Free and Fair Elections, known as Bersih, and others that MPs from the thoroughly disgraced United Malays National Organization are migrating to Parti Pribumi Bersatu Malaysia, headed by once and current Prime Minister Mahathir Mohamad, diluting the reformist zeal of the Pakatan Harapan coalition.  Although as many as 40 UMNO MPs are said to be contemplating such a move, Mahathir said they would be vetted individually and known crooks would be kept out.

But, said Kim Quek, a spokesman for opposition leader Anwar Ibrahim’s Parti Keadilan Rakyat in an email, “I foresee mounting tension when UMNO MPs slip into Bersatu, one after another quietly, causing endless suspicion…and mounting public disapproval.”

The headwinds outlined by Finance Minister Lim paint a pessimistic picture for both business and government. With the Trump administration cracking down on trade in Washington, DC, and the global economy beginning to slow, the budget, at a record RM314.6 billion, is forecast to run 3.7 percent of GDP in the red with economic growth expected to slow to 4.8 percent from 5.9 percent in 2017.  The ringgit, Malaysia’s currency, has fallen by 10 percent against the US dollar, in line with troubles across the world as interest rates rise in the United States, causing a flight out of emerging markets.

Lim, in his speech, set out a series of measures designed to help business and vowed to get government out of commerce, saying “clearly, government owned companies have been competing directly with private companies in non-strategic sectors. The outcome was the apparent ‘crowding out’ of private sector investments where private companies are unable to grow and compete.”

The private sector, he said, must lead, and the finance ministry is expected to establish a task force designed to evaluate and reduce duplication of functions,  a ray of hope that the country’s notorious rent-seeking government-linked companies, which funneled millions from inflated contracts to UMNO, could be cut back and its even more notorious cronyism could be reduced.

“Going forward, the government will focus its expenditure and investments only in strategic sectors and areas where the markets are unable to meet the needs of the people,” he said..

Nonetheless, business investment remains lackluster while the sector tries to figure out which way the government is going to go.

“Malaysia will undoubtedly be affected by the US-China trade war given that both these countries are among our top three trading partners,” Lim said in his budget speech. Exports remain a significant driver of the economy, particularly including electronics, oil and gas and palm oil.

Comeback kids: Like Dr M, other political figures have had second and even third acts during their careers, including (from left) Netanyahu, Abe, Berlusconi and Churchill    

Leadership remains somewhat unsettled, with Mahathir, at 93 the world’s oldest government leader, committed to staying for two years after the formation of the government. Anwar Ibrahim, now 71, has been waiting in the wing for decades, from the time when he was Mahathir’s chosen successor only to be fired and jailed after disagreements in 1998. Although he said he would study abroad and recover from his most recent imprisonment, he forced a by-election to return to parliament a few weeks ago, disconcerting some of his followers, who accused him of acting too quickly.

In the meantime, two of Anwar’s deputies – Mohamad Azmin Ali, the Minister of Economic Affairs, and Rafizi Ramli, the Parti Keadilan general secretary,  are staging their own internecine squabble to become deputy party leader with an eye to succeeding Anwar, raising concerns over party – and coalition – unity.  Pakatan Harapan remains a work in progress. Azmin is said to be aligned with Mahathir, Rafizi with Anwar.

That raises the spectre of Mahathir and Anwar continuing to try to do in each other despite public pledges of amity, including Mahathir campaigning for Anwar in the Port Dickson by-election that brought him back into the parliament.

“The Harapan guys thought that since they couldn’t get worse than Najib, people would continue to support them,” another source said. “They forget that there will always be alternatives; if not in the next five years, then in the next 10 maybe.  Inflation is creeping up; wages have not gone up; new taxes are being introduced and people still struggle to put food on the table. Business is slow; businessmen are not re-investing as they are unsure of this government’s policies.”

Award winning Journalist John Berthelsen

Euphoria is dying off and bodies like Bersih, he continued, have started criticizing the new government. Many from civil society are keeping silent. “I suppose the saving grace is that Najib and his cohorts are gone. But that can’t console people forever.”