Looking for a New Deal
The subject which has aroused intense debate has been the application of the NEP. We know that the policy ended officially in 1990. It has since been continued under different guises, retaining its most essential element- affirmative action to expand Malay economic advancement. It seems to me, we have been concentrating on the wrong indicator as to the measure of Malay economic achievement. One particular measure is the 30% share in corporate equity. Malay ownership in the equity of businesses registered with the ROC is taken as indicator for the extent of Malay share in the business. At the time the NEP was started, the Malay share of corporate equity was about 2%. The objective is 30% by the end of the NEP- 1990. Now, the figures tell us, the corporate share of Malay equity is somewhere close to 20% still short of the 30% target. This shortfall has emboldened policy makers in telling that we have not done enough actually. We have not been told whether this 20% share is held by individuals or institutions. There is a strong presumption to believe if the equity held by government GLCs is also included; the extent of Malay equity in corporate share may have well exceeded the 30% magical mark. Indeed the findings of a non Malay academic ( Dr.Lim Teck Chee) in this area were brutally savaged and dismissed. The use of equity share is not a definite indicator of the extent of Malay economic power. Equity share is fluid because it's traded all the time. Businesses started by Malays may have gone under and have not been accounted for. That portion of Malay businesses that have failed must have reduced the size of Malay equity. Shares held by Malays in listed companies may have changed hands and sold off to non Malays. Indeed the PM has admitted that out of the RM54 billion worth of equities allocated to Malays since 1970, only RM 2 billion remain. I assume that is the latest figure. It's hard to reconcile the extent of Malay equity with the fact, that by and large, the Malays remain relatively less advanced that the non Malays in economics. Why is that so? Why do you suppose that, taking as an example, ownership of housing by the Malays is still far less than the non Malays. Upscale houses appear to be owned more by non Malays. Malays lived in less appealing housing schemes. They dominate in low cost housing schemes. They dominate the numbers of inhabitants on illegal settlements. Why do you suppose that in terms of land acreage, the holdings by Malays are far less than non Malays? Take the case of the acreage of palm oil estates. The size of Malay owned estates is miniscule when compared to estate sizes owned by non Malays. Choice lands in urban areas as a rule are owned by non Malays. Most of the commercial buildings in urban areas are owned not by Malays. So ask yourself, why despite extensive government intrusion and government involvement, the Malay economy is weak? Is this a sign of the failure of capitalism and failure of the laissez faire system? The government has spent billions of money from 1970, yet the condition of the Malay economy has not even reached its modest targets. It will be the contention of the series of articles I am working on to show, that the plight of the Malays, is the result of the failure NOT of the free market system, but a failure of the GOVERNMENT. What is now needed is a New Deal in which the role of a paternalistic government is re appraised and a culture of free to choose is practised by the people. I end this short article with a video of a lecture by Milton Friedman.
8 comments:
Dato',
Freebies given out to the Malays will never last. Give them a good education and let them fight for their wealth. Wealth gained by their sweat and tears will definitely last.
If you let a person hang on to a crutch long enough, he may never be able to walk again. (But then this can be a form of absolute control and manipulation over that person!)However, if you remove the crutch early enough,that person may be forced to first crawl and then eventually be able to walk and then later on may even be able to race to the finishing line! (Isn't that what good parenting is about?)
Dato', you know when there is a political will, there is a way. How about giving some concrete suggestions?
Sir,
A simple kampong folk once told me something really unforgettable.
He said that we need the Cinas to make Melayu life easier and make Malaysia beautiful.
How?
Imagine without Cina, Melayu would have no Bandar to go to! Melayu can only build small pekan.
Simple but very telling!
The Malay culture must change and this could only be done by giving them the best in education. They must be told to get rid of the belief in myth and superstition. Learn as much from the Chinese who have been successful and stop giving them crutches.
Give them Education, Education and Education. And made them master English and Mandarin language. With education they would gain knowledge. With the proper knowledge there are no reasons for the Malay to not to be successful in trade and commerce.
Agreed with Pak Zawi that only wealth gain by sweats would last.
We need the affirmative action..its not a crutch but a kickstart..but the mode have to be reviewed;
For instance...its not about allocating shares to Bumis but more about giving an opportunity for Bumis to be directly involved in running a business with potential financial rewards (if any) 5 years down the line as well as gaining valuable operating experience in that particular industry.
Similarly..for construction it shld not be about instant wealth but more of continuity in opportunities so that there can be capacity building.Thus,it must be a 5 year programme of consistent and orderly growth in specific niche of the industry.
Most of all..the key requirement is meritocracy amongst the Bumis as the first step.
its not difficult to construct the programmes..only the political will not to deviate from the basic guiding principles.
Pak zawi & Fairplay
please dont talk about crutches or freebies.....as if that the reason malay cannot go far....thats the reason most non malay wish to believe too.
Please get the point that Dato Sak is trying to tell everybody...the crutches or freebies belong to the putera-bumi not bumiputra. Maybe the policy looks like we're having a grand time down here...but in reality we down here have to work extra hard to be anything that we wish to be...
Salan Dato' Sak and others,
This is an inherent age old problem of at least a few hundred years old. Melaka is well known as a great port of commerce and trade in the region, despite the length of time from Parameswara to Portuguese takeover of only a hundred years, 1400~1511, we might infer that it was at its peak for maybe 30 years or 50 to give it the benefit of doubt.
'Zaman Kegemilangan Kesultanan Melayu Melaka' according to Wiki (http://ms.wikipedia.org/wiki/Kesultanan_Melayu_Melaka) were probably the most illustrated time of Malay excellence in business and trading, so where did all the great businessmen go? Or was it as it is now, where Malays held political and military power but economics and trade were left to the hands of foreign traders be they Arabs, Chinese or Indians?
Another point not usually mentioned is that the immigrants who uproot to a new land, temporary or otherwise does so for economic purposes, so it's either make or break, they can't afford to fail, they are literally looking for greener pastures and essentially their own survival. The very fact that Indonesians risk their lives crossing the choppy waters of the Straits to enter the country illegally to end up working in a construction yard, means the country is full of opportunities to those who see it in them.
It's not about crutches or assistance or even education, or mindset as TunM likes to point his finger to, the fall of Melaka and to some extend the fate of the Malays henceforth has been blamed on external forces one after the other, Portuguese, Dutch, British and now the other races.
Nobody seems to have a clue, it's just one of those things you can't really put your finger on. So what's the truth?
Riff,
This is the first time I am commenting though I have been following your blog for quite sometime.
TDM was asked how he would feel if he were to put himself in the Chinese shoes.(only chinese shoes not indians?) He didn't answer the question but instead went on a lenghty explanation on the fact that the Malays were still lagging behind after close to 40 years of affirmative action. Since for the past few days you have been writing articles on 30% equity, NEP etc, allow me to give my take.
If you put me in the the Chinese shoes of course I will be unhappy. The same thing applies if you put yourself in the putera bangsawan, putera raja, putera UMNO (borrowing your terms) you will be very-very happy. I don't have to put myself in the Chinese shoes to be unhappy. I am now wearing the bumiputera shoes and I am not that happy because my shoes are not of UMNO brand. Only people wearing UMNO branded shoes and socialise with those close to the umnoputeras in the corridors of power can have special treatment, can own big mansions, send all children study overseas, get lucrative contracts, holidays everywhere on this planet etc...etc. Like you said, these are all rights for special malays. The way things are going in this country, we will become a failed state in the not too distant future. Are the Malays borned stupid? Off course not. Are the Chinese brains superior than the Malays? Off course not. Then, how come they are more successful economically? And how come the Malays cannot be successful economically despite the assistance given for almost 40 years? Pls give an honest answer. The simple answer is UMNO breeds and tolerate mediocrity. Umno helps those Bumiputras that do not have the knowledge, discipline, capability, honesty, not willing to work hard and intergrity to succeed. When they were given the contracts/shares, they will sub or sell it out for quick gains. They don't add value and create more wealth because they don't know how to do it. And UMNO tolerate this. If not, how come this has been going on for the past 30 odd years? We cannot allow this to happen. But UMNO tolerate all this because these people are warlords that will keep them in power. Help/projects are given on the basis of political and economic patronage not meritocracy. We have to implement meritocracy at least among the Malays first so that all deadwoods, rent-seekers, good for nothing, lazy Malays are weeded out. There are many Malays who are capable out there that can perform better than some of the idiots good for nothing ketua bahagians/cawangans. Do not blame other races for our shortcomings.
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