From the Sun frontpage, March 22, 2007:
Musa Hitam: Malaysia Must Waive NEP Policy in Johor
Malaysia should exempt the southern state of Johor from policies that favor the ethnic Malay majority to help attract foreign investors to the area, former Deputy Prime Minister Musa Hitam said.
Policies that give the racial grouping privileged access to government contracts and guarantee a minimum presence in the workplace may deter foreign companies from coming to Johor, said Musa, who is advising the government on the state’s development.
Contract awards “will have to be on merit,'’ Musa, the country’s deputy leader from 1981 to 1986, said in a March 19 interview (EXCLUSIVE to Bloomberg) “The Malays will have to face competition.'’
Prime Minister Abdullah Ahmad Badawi is seeking foreign investors to help fund a two-decade, RM382 billion (US$109 billion) redevelopment of Johor, bordering Singapore. Scrapping the race-based program could lure investors and pave the way for the country to completely drop its 36-year-old policy in support of ethnic Malays, who comprise 60 percent of the population.
“It would be an exit route, politically,'’ said Manu Bhaskaran, a Singapore-based partner at economic research company Centennial Group. Johor “is an extremely important project. The affirmative action program and all the related problems do turn off foreign investors.'’
Foreign direct investment in Malaysia in 2005 dropped to 15 billion ringgit from 17.6 billion ringgit in 2004, according to the government’s department of statistics. Last year’s figures haven’t been released.
Wealth Imbalance
The racial program, introduced under the New Economic Policy in 1971 after clashes between ethnic Chinese and Malays, also known as Bumiputras, aimed to increase the wealth of the nation’s poorest grouping through benefits ranging from cheaper housing to greater access to initial public offerings.
Concern about the policy’s validity grew last year after a report by the Asian Strategy and Leadership Institute in Kuala Lumpur showed the original targets to address the wealth imbalance had been surpassed.
The February report by the Centre for Public Policy Studies, controlled by ASLI, said ethnic Malays may own as much as 45 percent of Malaysia’s corporate equity. That was higher than the government’s estimate of 19 percent in 2004 and surpassed the New Economic Policy’s goal of 30 percent.
ALSI on Oct. 10 last year said there were “shortcomings'’ in its report. Lim Teck Ghee, director of the Centre for Public Policy Studies, quit a day later to protest the retraction.
Policy Revision
A five-member council including Musa and Malaysian billionaire Robert Kuok that’s advising the Johor project agrees the ethnic program should be dropped, Musa said.
“I am confident that this Bumiputra thing, if I may put it this way, need not be the negative factor, and I am stressing this in this particular exercise,'’ Musa said. “There needs to be a revision, updating, of the way we approach it.'’
Incentives to take part in the Southern Johor Economic Region are being finalized, Musa said. Middle Eastern and Japanese investors are among those that have agreed to plow funds into Johor, he said.
The 2,216-square-kilometer development will include roads, offices, homes, theme parks, hotels, factories and hospitals and is Malaysia’s biggest real-estate project. Development of the region will require 382 billion ringgit of investment from 2006 to 2025, according to Khazanah Nasional Bhd., Malaysia’s state investment unit, which is leading the project.
The site will generate more than 800,000 jobs in 20 years, Prime Minister Abdullah said in November. It may boost growth in Johor to an average of 7 percent from 2005 to 2025, compared with 5.5 percent without the revamp, Khazanah said.
Reaching the project’s targets, without the affirmative action program, would allow the government to remove the policy in other areas, said Bhaskaran at Centennial Group.
“This is a very clever way,'’ he said. “It shows that at the top ranks of the system there are people who are thinking well.'’
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DESIDERATA: First, it was former Deputy Prime Minister Sdr Anwar Ibrahim who said it was time to end the New Economic Policy and replace it with a New Economic Agenda which is needs/economics based and not one grounded on ethnoicty as the NEP was/has been/is.
As Anwar now is Party Adviser to Parti Keadilan Rakyat (rivalling UMNO mainly as an alternative to Malay constituency), his voice might not be popular with UMNO former comrades, even if many members see the wisdom of such a policy change. Now coming from diplomatic and suave Tan Sri Musa Hitam, in a limited sort of way using Johor Iskandar Specil Region as a testbed, it's now raised to an implementable plane. We all know that behind-the-scenes Musa has been lending lots of his experience and advice to help Pak Lah face the challenges of the CEO's office -- fedning off enemies from withion and outside his own party!
Anwar has recently described the Prime Minister as a "decent and placid" bloke, and knowing the PM as a God-fearing man, I tink he will pay heed to Musa's counsel. INdirectly by applying the ISR platform, the weaning of Bumpiputeras' away from the dependency mentality (resultant from NEP abuses chiefly) is starting. The first significant policy adaptation is talking a leap forward.
Maybe the "Rip van Winkle" with former DPMs proddings and cajolings will awaken from his beauty sleep to walk tall? Like a dragon?
8 comments:
As long as issues like Article 153 remain untouched, they remain half measures which would leave Malaysia a place which is not just and equitable. How can progress be hatched when large sections of the community remain less than equal as a matter of law? Half cocked, more shots would be required many years from now, just as NEP's inequity has dragged on for over 35 years leaving Malaysia in its current dire straits.
Pointless to move any further, as long as no one is bold and powerful enough to do what is necessary, it'll just be plain talk... in Belehland
Another chance to make money if you are in UMNO... sell land to foreign companies wanting to invest in Iskandar (at a premium, of course). Psst, I'm going to bodek the son-in-law, etc, immediately.
Sorry to drop by this Friday with a truckload of pessimism. ;-(
teetwoh:
I agree that "progress" in nation-building will be slow if fundamental issues (you esp refer to Article 153) of NegaraKu are not reviewed. Dire straits indeed, but I can appreciate even "baby steps" taken by Pak Lah as we must take into account he inherited 22 years of the previous Admin's shenanigans and UMNO realpolitik does have many constraints during his Term One. Mayhaps (A probability that is even remoter than suggested by maybe or perhaps...Desi's def:)more sun will shine through in Term Two, or better yet, PKR under Anwar Ibrahim takes over? (MayMayHaphaps!:( but everything is possible in Politics!
freethinker:
be thou not so pessimistic; if good men don't stand up and be counted, NegaraKu will continue its slide towards the Abyss.
I hoipe bloggers like thee (and Desi and awe myGOoDfriends in blogsworld!) can lend a helping hand TO MAKE A DIDDERENCE.:):)
pro-SIL:
I know you are "jesting", rite?
Just count Desi in for 30%!:)
awe of HELEN!
"truckload of pessimism" all the way from eeeehPOHchic?
No, I offer thee tehtarik, and with thy Hor-FUN-d, we will MAKE A++ DIFERRENCE! s-s-s-s-s-s-S-mile from Furong:):):):):):):)
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