A glimmer at the end of the tunnel ?

One of my readers, klm, has written this comment yesterday:

I was going through a number of papers on Global Competitiveness. If one looked into the numbers, the potential of Malaysia is quite obvious.

In these studies, Malaysia is always slightly above average but never rises to the top 10. It looks like there is a permanent speed limiter holding the potential back. Hence, Dr Hsu’s question – what went wrong? Why is Malaysia consigned to be mediocre?

One way to look at it is to see the NEP and NDP as an in build speed limiter. NEP was designed to slow the progress to give the Malay community a chance to catch with the other communities.

NEP was not designed to use for long period. And it was designed to help those who needed help. Unfortunately, this was hijacked by the UMNO politicians and businessmen cronies for their own ends. The rest is history.

Unfortunately, Malaysia is now stuck with the permanent speed limiter……

Unfortunately, for the NEP shackle, many speedsters have to find other avenues. Hence the brain drain. Until and unless, the shackle is removed, this trend will continue.

Also, unfortunately for Malaysia, the world and it are on a superhighway. A vehicle with a speed limiter is not able to increase speed to catch up with others.

I think the analogy is very appropriate. Many top UMNO people know this. Many top civil servants know this, but they are just not bold enough to take the initiative to break this speed breaker.

The quota system as well as  skewed implemention of the NEP has brought the country almost grinding to a halt.

Despite the boast by our leaders, the fact remains that we are in the middle rungs of all the countries in the world in term of GDP measured using Purchasing power parity. We are number 60 in the list of IMF. I suspect 40 years ago, we might have a better ranking, even though still among the middle rung countries. (refer wiki IMF list here).

Countries like Botswana ( a country in Africa), Libya, Trinida, Malta to name a few , are above us..

The quota system has acted as a speed limiter, and those inside the truck ‘Malaysian inc.’, regardless of ethnic originals, are all slowed down. Even those who were given handicap are slowed down.

Had we adopted a more liberal policy, the country ‘s per capita income would have gone up to within the top 30 at least, judging by our ‘contemporaries’ such as the tiny-dot-down-South, Taiwan, Hong KOng and so on.

Everyone irrespective of ethnic origin would have been richer, and the truck would have reached the destination of ‘developed nation’ much faster. And with a ‘developed’ infrastructure, everyone, again regardless of colour, would have benefited more.

Yesterday, our PM has finally taken the first step in doing away with the quota. He announced that public listed companies are now no longer bound by the 30% minimal bumi equity requirement.

There is still a requirement that among the 25% of the public spread if a company wants to be listed, half of it must be given to bumi. So for a company going for listing, it has to reserve 12.5 % for bumi shareholders, instead of the present 30%.

More importantly, after listing, companies do not have to be bound by this requirement anymore, and thus in effect,  after listing, there is no more restriction on share ownership

I see a glimmer of light at the end of the tunnel now. Hopefully, this is the first of further liberalisation of the economy, as well as other fields such as education, human rights and public service.

For so long, the skewed NEP has acted not only as speed limiter, but also as a root cause of ethnic disunity and brain drain.

The original noble objectives of eradication of poverty regardless of ethnic origin has been hijacked and changed into a vehicle for manupulation, resulting in the present state of poor governance, mediocrity in all fields, and marginalisation of the real poor of all races.

It is true that the poor must be given help, but since in every group , there are poor and unfortunate people, any interventional assistance must be based on ‘needs’ and not colour.

So I welcome the announcement and hope that there would be more liberalisation towards a fair and equal society ,as well as  more liberalisation towards a society based on respecting human rights.

My only reservation is this: Now that the speed limiter has been partially removed, and the truck is ostensibly allowed to move faster, will there be ‘obstacles’ and ‘detours’ put in place by those in charge of implementations (like what happened to the NEP)?

And will this partial removal of speed limiter be reversed if there are objections from the dominant party warloads? Will there be flip-flopping again as has happened so often in the past?



14 Comments (+add yours?)

  1. clearwater
    Jul 01, 2009 @ 17:18:33

    Dr Hsu,

    Introducing piecemeal liberalization measures to the Malaysian system is like dropping snow flakes on to the streets of Kuala Lumpur and hoping we can have enough snow by year end to have a white Christmas. It is not going to work. The system is rotten through and through. We do not have a leader strong enough to reform the civil service and its prevailing culture. I do not see anything that will work other than a change of government.


  2. ahoo
    Jul 01, 2009 @ 18:09:22

    KLM”s had very aptly presented the situation that Malaysia is in today. In facing the globalised world out there, it is the fittest and the finest that survive. As the saying goes,….. the early bird catches the worm is also appropriate.

    We cannot allow “tidak apa altitude” to continue in our civil service if the govt of the day wants to see changes. They must set a certain standard for the admission of such staff. They cannot simply hire any tom, dick or harry. It must be a set of people that know to manage that very dept well with the right mix of talented personnel.

    They the govt needs to burn midnight oil in pursuing changes across the board for all sectors. Not just some selective area as human resource development take time. If we ever need help, ask them that have the experience, like the little red dot, down south. Swallow all pride and enlist the
    “little emperor’s” assistance whenever necessary.

    All said, I am not too sure whether the changes as announced is just another political ploy ? Until and unless we see true changes in the coming days, we are all heading down under,…. not Ozzie land but real economic disaster with hardly any growth for the next 2 to 3 years.


  3. Justin Choo
    Jul 02, 2009 @ 15:44:16

    Dr Hsu,

    Knowing too well how the incumbents work, this latest announcement is not total upliftment of restriction and quota. In addition, is there any guarantee that there will be no reversal?

    It’s just adjusting the “speed limiter”. We are still going no where.

    Add to the gloom, PAS is looking like it’s returning to its Taliban mentality, with the Kedah saga.

    Talk about migration, I thought it was only during my time (1980s and 90s) that the great migration took place. Not knowing even up to today.


  4. Dr Hsu
    Jul 02, 2009 @ 16:11:09

    If Nik Aziz is no more around, I think Pakatan will break up. There are too many ideological/nationalistic elements in the Islamic party. DAP will be cast in a bad light if they go along with this, just like the component parties have been cast in a very bad light by going along with the excesses of the big brother. So DAP has to pull out from this. Anwar will have a tough time.

    That is why I have advocated Gerakan to be out of BN but remain independnet as a small third force, siding with whichever side that is implementing good policies for the people.

    COming back to Kedah, if Kelantan can allow Pork to be sold, why cant pork be sold in Kedah?

    Anyway, there is a group of people forming a National Pork consumers’ Association, which is now in the process of registering. I have been invited to be an adviser to the association.

    I think the people must learn to be more tolerant and liberal, especially regarding food habits, faith and culture.


  5. klm
    Jul 02, 2009 @ 18:28:44

    Dr. Hus. I am honoured by your reference to my comment.

    Although the recent announcements by Najib sound good, at best it is still half step. There is no removal of the barrier of discriminatory practice.

    When these practices are still there, the speed brake is on.


  6. A true Malaysian
    Jul 02, 2009 @ 18:48:33

    I am not convinced at all. This glimmer at the end of the tunnel will be blown of by a light wind before we even start from the other end of the tunnel.

    What Najib should do is to gain back the creditability of himself as well of the country to bring back investors’ confidence in putting their money in Malaysia.

    As for PAS, I agree with Dr. Hsu that once Nik Aziz is no more around, Pakatan will break up. But, there is a probability that the Erdorgan group will form a new political party within Pakatan, or even better, to join either DAP or PKR. After all, it is best to leave religion (in this case, Islam) out of politics. If a political coalition can be clean, fair and equitable in their policies and practices, why should they stressing on these in the name of Islam?


  7. annoyed
    Jul 02, 2009 @ 21:07:45

    written by annoyed, July 02, 2009
    I see all these “huh-hahs” as preludes to Manek Urai by-election. Umno has a hand in all these huh-hahs with the hope of creating cracks within Pakatan Rakyat.

    It is time for Pakatan Rakyat to clean up these unprincipled politicians that cannot resist dangling carrots.

    Please vote + if you agree to my analysis.



  8. chabalang
    Jul 02, 2009 @ 21:16:04

    Even though I am currently pro-PR (or rather pro-rakyat), I am happy to see a first good move in the right direction. Many of my friends/colleagues have been pouring “cold water” on me, saying that I am NAIVE to believe in the new PM.

    I thought – why not if it is good move…every journey have to start with a small step. I guess that they must all be disappointed with the BN Govt over and over again. I do believe that the new PM should be given a chance to prove that he meant what he said (like 1 M’sia) – only time can tell (maybe over the few months or a year, we shall see whether it is “hangat-hangat tahi ayam” or not). I hope that the readers will not bash me up for supporting the PM (I am NOT pro-BN).


  9. Observant
    Jul 02, 2009 @ 21:55:35

    I think we should be pro-good policies and good governance … irrespective of parties!


  10. annoyed
    Jul 02, 2009 @ 22:19:28

    I am skeptical.

    I believe Dr. Hsu too, if not, why not a ‘light’ but ‘glimmer’ at the end of tunnel?

    Shifting of goal posts is bound to happen….


  11. stevent
    Jul 03, 2009 @ 01:27:59

    I remember in an episode of Stephen Colbert where he said something about how the poor benefited from the tax cuts the republican gave to the rich when the poor does not even have enough in their income to write in those cuts.

    This is the same here. If the intended Bumis are so poor, what makes you think they can afford to be part of the 12.5%, not to talk about the original 30%. These quotas are designed for the UMNOputras to become a lot richer while leaving the poor poorer.

    The only solution is to have full meritocracy in our society. The poor will be able to stand on its own. The NonBumi poor has been able to stand on their own for about 5 decades, what makes you think the Malay poor cannot? In fact history has shown that regardless of the benchmark being put inplace, there will always have similar amount of people who are poor/middle/rich. So the government affirmative action are actually hurting the Malays rather than helping them.

    Just take the blacks and the latinos in the US as a learning experience as the latino community are as poor as the black community if not poorer but yet they could lift themselves out of poverty as a much faster rate than the blacks despite the blacks benefited most from the affirmative action.

    We are now competing globally and the longer it takes for us to dismantle our speed limiter, the more our country will be at a loss. The worst part is that time do play a role and if we do not recover fast, we would not have the opportunity again as other third world nation will just replace our spot as the ideal place to invest. The UMNOputras need to worry about this as they had already accumulate the wealth needed, but as for the rest of the population – too bad.


  12. Nick
    Jul 03, 2009 @ 16:24:18

    I think permanent damage to the psyche of an ordinary bumi is the result after 40 years of “spoon-feeding”. All it does is breed a “weakened” species. They are born to believe that the state owes them a living. Tell me which malay parent save anything for their kids education. Find me one (except RPK) and I stand corrected. GLCs are the preserve for ‘them’. There is no meritocracy practised there at all. The Chairman of NSB is the Chairman of Kuala Dimensi. How can a significant private sector player also sits on top of a government owned Bank???? A sure conflict of interest and the result is catastrophic scandals and leakages for the tax-payer money. The speed limiter analogy is appropriate. They need to “slow-down” the high achievers and to force out anyone who dares challenge the inalienable rights of those born into the correct species. What Najib did is mere tinkering. The FIC is still there, not entirely dismantled. Quotas are still there. APs are still there. Taxi Permits are still there. What has change? These guys never learn until it is too late. Better that we all tell our children to excel abroad and where their natural talents and achievements will be recognized and rewarded. Forget about working here but come home and enjoy the food and your foreign money is always welcomed.


  13. Atila
    Jul 04, 2009 @ 23:34:21

    “…They are born to believe that the state owes them a living. Tell me which malay parent save anything for their kids education. Find me one (except RPK) and I stand corrected…”

    Please dont generalize, my parents save for me and my brothers education and we are now age 42 and 39.

    My uncle with 10kids all graduates and he fork his own savings to send them into universites local and abroad.

    Recently my 10A SPM niece went USA with my cousins savings.

    There are Malays who save for childrens education but not as many as Chinese.

    I am a Malay origional breed, I always remind my nieces and newphews that we Malays is one civilization behind the Chinese, thus please strive hard for education.

    UMNO is the one wanting the Malays to be complacent, behind and backward only the elite remains at the top.

    We are educated within Malay community kampungs face boycots becoz UMNO teaches these lower educated Malays to gengterism, you dont need education to live, etc.

    Some of us think like any non-malays but we are a threat to the lower uneducated malays.
    I suppose this what you call CHANGE.


  14. Atila
    Jul 04, 2009 @ 23:43:30

    Dr Hsu

    PAS is only stablize with Tok Guru around.

    Even in Permatang Damar Laut N37, the only representation to PR is PAS Cwgn Pmtg Dmr Laut.

    They make it JKKK (N) controlled by PAS, I was interrogated in JKKK meeting 24May just becoz i was from ex-umno the truth is they want me out.

    Recently they hold JKKK meeting 30th June..what a mockery stupid….in other words, just like any party, top is ok but the low are spoilt apples.

    I made up my mind to quit this PAS oriented JKKK
    with colloboration with PKR becoz its no point goin against the JKKK who are 50-60% do not complete SPM / complete but failed went to school for attendance only, they dont want to see the importance of ducation take you out of miskin tegar…etc.

    They cannot accept demographinc changes in N37 that professionals are around. They ask for it and what we can see is this kampung can be the next Kampung Buah Pala. Why are they resistance to us professionals? who is behind them? haha!!

    I can always contribute elsewhere at peace.
    Life is short, look at MJ.


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