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In a league of our own June 22, 2007

Posted by elizabethwong in Current Affairs, Economy, Malaysia, Politics.
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The very blunt statement by the EU rep in Malaysia made its rounds in major financial news sites from Forbes to Business Week, and even local eateries.

And the sum of all things said:- It ain’t worth the trouble to invest here.

Even my neighbourhood Bak Kut Teh uncle gave his two cents worth last night, “We losing investors to Vietnam, Thailand and China. They are welcomed there. Here, we drive them out.”

Consider the following:- Corruption. Kickbacks to keep the families happy. Greed. Red tape.

Malaysia’s FDI dropped 14% last year. Our Transparency International CPI ranking slid 5 spots down.
Do we care? Nope.

We’re in the Premier League and “… it’s not easy to improve,” says the Prime Minister’s Department rep yesterday.

Ok-lor. We’re in our own little league.

So, when those countries, whom we once shared the limelight a decade ago as the ‘Asian Tigers’, galloped light years ahead of us and we can’t even catch up to eat their dust, who is to be blamed?

The Jews?
The Opposition?
Anwar Ibrahim? Al Gore?
The Communists?
The Singaporeans?
Blogger?
…….. (Umno-aites, you can fill in the rest of the blanks. But I’m guessing EU will be the next punching-bag)

Meanwhile, there’s no immediate reaction, except Bernama totally ignoring what Rommel said. Malaysiakini.com has a slightly more measured feel to his speech but the substance is still that of a re-examination of the NEP.

(Those who missed out on Rajah Rasiah’s presentation on the NEP last week should go stand at the corner of the room and cry.)

Associated Press
EU Envoy Blasts Malaysia’s NEP
By EILEEN NG

Europe’s top envoy to Malaysia Thursday urged the government to roll back its affirmative action policy for majority Malays, saying it is discriminatory and amounts to protectionism against foreign companies.

In unusually frank comments that ignored diplomatic niceties, Thierry Rommel openly criticized Malaysia’s 37-year-old New Economic Policy, or NEP, that gives a host of privileges in jobs, education, business and other areas to ethnic Malays.

“In a dominant part of the domestic economy, there is no level playing field for foreign companies,” Rommel, the ambassador and head of the European Commission Delegation to Malaysia, said in a speech to local and foreign businessmen.

Ethnic Malays and other indigenous groups, known as Bumiputras, comprise more than 60 percent of Malaysia’s 26 million people. The government says they have a disproportionately low share of the corporate wealth compared to the minority Chinese, and need the NEP to increase their standard of living.

The government did not immediately respond to Rommel’s comments.

Rommel said the government is using the NEP as an excuse to practice “significant protectionism of its own market,” including the automotive sector, steel, consumer goods, agricultural products, services and government contracts.

Malaysia claims these are “infant” industries that need to be protected but “in reality .. it is the Malay-centered Bumiputra policy that drives protectionist policies,” Rommel said.

As part of the NEP, all public-listed companies are required to allocate 30 percent of their shares to Malays. Companies without Malay directors or employees are excluded from lucrative government contracts. Employers have quotas for hiring Malays.

Eric Reuter, sales and marketing director of freight forwarder ABX Logistics, said the Belgium-based company has a 51 percent Bumiputra partner and is required to work with local companies on government-related projects.

The limitations have eroded his profit margin, he said.

“We cannot be as flexible as we want to be and chances that corruption comes into play is higher. It is an interruption to the free market,” Reuter told The Associated Press.

Besides foreigners, minority ethnic Chinese and Indians also see the NEP as a discriminatory tool. Many Malays also have complained the policy has benefited only a few well-connected people.

NEP was started in 1970 when the Malays’ corporate ownership was 2 percent. The aim was to raise it to 30 percent by 2010, from 19 percent now. Chinese, who form a quarter of the population, control 40 percent of corporate wealth.

Rommel stopped short of saying the NEP should be scrapped but told reporters separately: “We (in Europe) have bitten the bullet on a number of sensitive issues, why can’t you?”

He warned the NEP could “lead to problems” in free trade negotiations between the EU and the 10-member Association of Southeast Asian Nations, of which Malaysia is a key member.

The two groups agreed last month to launch free trade talks, which could raise ASEAN’s exports to the EU by up to 20 percent, Rommel said. Senior officials are expected to hold their first meeting in Vietnam next month, he added.

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Comments»

1. wits0 - June 22, 2007

This Rommel’s namesake did a North African Blitz and nearly beat the s**t out of the Brits in his time. Heheh.

Bodohland is getting fingered clearly as a Bangsatland. It looks like just the beginning of the end for a false facade…

2. Muhammad Yunus - June 22, 2007

I think it is immature and amateurish of Rommel to comment the way he did:

[Rommel stopped short of saying the NEP should be scrapped but told reporters separately: “We (in Europe) have bitten the bullet on a number of sensitive issues, why can’t you?”]

The ethos of Malaysia’s New Economic Policy (NEP) is sound as it addresses the growth and ethnic inequality within the socio-economic environment.

Hence, the NEP should remain. However, I do strongly agree that it has to be reviewed and improved, as the inherent problem with the policies unsatisfactory and to an extent degrading outcomes is rooted in it’s implementation or delivery system.

I do not see the need to take drastic measures i.e. abolishing NEP. The agenda in relations to why NEP was formulated has not materialised. Thus, it is only wise to improve on it – implementation / delivery system – to avoid opportunities of corruption and better transparency / accountability.

Cheers!

3. Nstman - June 22, 2007

I bet Umno will say this statement is a Nazi plot to destabilize the country. Why Nazi plot? Because Rommel shares the same surname with the great German general. Umno will surely make a meal of it. Seig Heil!

4. WATTAHACK? - June 22, 2007

all can say what they want but the bottom line is NEP became a stumbling block for Malaysia to grow and compete…period!

5. rodsjournal - June 22, 2007

I beg to differ with the one using the Bangladeshi micro-credit guy’s moniker.

I’m ambivalent about any affirmative-action policies anywhere, anytime. At the most, all such policies have a use-by date.

The Malaysian (BN) government doesn’t seem to realise that the NEP’s gone way past the use-by date, especially when other factors such as corruption come into play.

Reviewing or reforming the Implementation/delivery system? Please, spare us. If that was the problem, then first, or concurrently, get rid of the corruption and the patronage, etc. If you can’t get rid of those, then the NEP as a whole has become a problem, in spite of its initial noble intentions.

It’s easy to something like ‘reform the implementation practices blah blah blah’. It’s harder to get rid of the corruption that rides on it. And even harder to admit that maybe, just maybe, the policy itself is self-defeating to begin with.

6. wits0 - June 23, 2007

The ethos of the NEP has been proven to be unreliable, inconsistent and not in keeping with its stated aim. Expect more external Rommels to arise with similar criticism from various sources with a greater frequency.

The mention of fine tuning is just so much PC talk. It should have been seen to have been applied over time. There is, even now, no poltical will to accept this need by the power-that-be. Therefore it’s just as good plain hot air.

7.   thierry rommel’s admonishments by reduced and recycled - June 23, 2007

[...] maybe not. As Elizabeth Wong’s observed, the message is clear: it ain’t worth investing in [...]

8. sam - June 23, 2007

We friend-friend with Zimbawe, Nambia and friends mah…

9. OA - June 23, 2007

.

someone up there said :

the inherent problem with the policies unsatisfactory and to an extent degrading outcomes is rooted in it’s implementation or delivery system.

________________

Wow!!! it took them 25 years to realize that after the fact ….
How original the observation … LoL

.

10. Muhammad Yunus - June 23, 2007

NEP is naught but a mere policy. Sadly an infant policy at that, which during the formulation stage did not include clauses or guidelines that emphasize the need for good governance – accountability and transparency. Hence, opening it to interpertations and implementations that are potentially abusive and corrupted – in fact, I agree that the abuse has been downright rampant and ‘in your face’.

Perhaps, it is fair to say that NEP has developed into a tool that proliferates corruption. Consequently, resulting in suggestions for it’s abolishment. Or is it actually the lack of integrity and good governance and nepotism / cronyism, that has made NEP like a prickly stick up the bottom?

I might be wrong and lack mature observation, but if we do truly believe that NEP is a tool that proliferates corruption, would that mean that it’s abolishment would result in a significant reduction in corruption? And if it is true that the inherent problem is in all actuality an external one – which origins stems from greed and voracity, would it be shrewd and sensible to simply mend it? And wouldn’t that result in an impact which is more holistic.

Bottom-line: NEP is treated unfairly. Diagnosis of the problem points to poor good governance. Treatment should then direct towards curing or improving the state of good governance not dropping a bomb and obliterate everything. NEP can be good, minus the poor governance – which is root to all problems.

With the existance of poor governance, ANY policy can be a corrupted policy, especially the infant ones that does not include clauses that proliferates and encourage good governance. Then, what do we do? Annihilate every single policy that has been abused, despite it ethos = intentions of formulation? And how long shall we wait for another policy that addresses growth and ethnic inequality to be formed?

On the assumption that we would like to seriously correct the grave situation of ethnic economic disequilibrium prevailing in the country at this later stage, the challenge is how do we go about devising policies and strategies and implementing them in full, to bring about correction in the situation constructively without violating the economic rights of the non-Malays and adversely impacting on growth and productivity of the economy.

The answer MAY lie within NEP plus many reviews and changes. Or perhaps I am the only one who’s paranoid and see’s this ethnic economic disequilibrium as a grave situation?

11. wits0 - June 23, 2007

Timber, free, for an ugly Mugabe’s palace. Embrace for Castro and now making a big and proud thing out of being endorsed by Communist Cuba, it seems. Re: http://howsy.blogspot.com/

Like a stingy man buying only penny stocks, avoiding blue chips, and hoping to make it big in the stock exchange through “luck”.

All the dependece on foreign labour(partly caused by a large section of own population shunning menial labour in construction) and inability to monitor the situation, resulting in gross excesses in mistreatment of illegal immigrants. Not forgetting towing boat ppl back out to sea and letting them drown not so mmany decades back.

Yet all the talk shop wrt Burma via Arse-seen and impotency to deal with the repressive Junta. And if the US or China were to come down hard on the Junta’s Burma, all condemning show of solidarity would appear in the stupid name of, “Sovereinty and Integrity” protestation show. Is there anything in it’s foreign policy that is inspiring to all section of its populace apart from e.g., sucking up to the Arab tourists big buck…..trepidation appears on the mention of maids from China. Ha!

If not also externally bangsat, how about the instances os such reports like, e.g., wrt a GLC caught not paying oil tax to a poor African country? The mean Ugly Malaysian image took time to build up and is not something simply made up by choice.

12. Anymany - June 23, 2007

Dear Mohammad Yunus,

Yes, the aim of NEP was noble. But, after 37 years, we can’t blame its failure on implementation anymore. Just like a child born, after 37 years, you don’t expect him to suckle from mother’s breast anymore. If he was brought up right, he should be good by 37 years of age.

The fact is clear. It is no longer possible to achieve the NEP altruistic aims. In its failure, too many have seized opportunistic loopholes to enrich themselves and created a new sizeable problem for the country-corruption. Therefore, it should be scrapped. And let the country takes a new course of action to deal with income inequality.

13. wits0 - June 23, 2007

The spirit of implementing the NEP was hardly the right one from the start. Any astute observer would have had the same doubts about it 37 years ago because of all the attached hobbling policies that also came rapidly in tandem….making its noble-sounding stated intent of not having anyone else feel a sense of deprivation incredible.

37 years later the spirit within got from bad to worse (re: the Keris Opera)but the feudal mentality of its beneficiaries only understands things as if written in stones and rave for ever more. Obviously the AI episode did help some to reconsider matters just a little differently in private by way of seeing things a mite less feudalistically…but not enough.

14. wits0 - June 23, 2007

Helping the poor to get on their feet is always a noble goal but the exclusiveness of determinig poverty on the basis of skin color is hardly so. After 37 years and still want an A1 Image?

This is the double-speak bangsatness(meanness)that is seen at work even within the country’s foreign policy and others as well.

The facade has openly crashed as Humpty Dumpty’s fall.

15. yh - June 23, 2007

if we continue the present way, chances are that we will be group with zimbabwee and other corruption infested countries. then “birds of the same feather flock together”

16. wits0 - June 23, 2007

And the audacity of a certain minister to say, “Singapore is not a real country, it is a small island. Singapore’s population is just three to four million and there are no opportunities for corruption, unlike in our country. ”
http://www.lucialai.org/

This confirms the quality of Bodohland’s leadership quality. You think they’ll ever redress the shamble that the NEP has wrought and will wrought? 2057, anyone? Buy a bridge too?

17. jeancumlately - June 23, 2007

Yeah…its time to bash the nep and the malays again…

BTW, NEP was also there when we were the so-called “asian tigers” a few years back. No one really bothers about NEP a few years back when everyone was making money…When we were one of the “asian tigers” and all the FDIs were pouring in, was it because of NEP? Now they left, was it because of NEP?

True… NEP was badly abused by umno’s greedies BUT the truth is, the economic pie is getting so small only the privilleged few gets the share. The rest of us will have to kill each other to survive.

18. whispering9 - June 23, 2007

si, jeancumlately is right.

19. OA - June 24, 2007

.

Stop defending this “useless” policy. Its usefulness has expired unless of course it is subjected to redefinition of intents for ALL???

The idea that the policy had a good intention was never a fact but more like a “veil” of deceptions – to grab everything from the other more successful races – as can be witness by the protraction and continuation of this useless policy – which artificially in a negative sense – formulating and creation of restrictions in many forms with the purpose of satiating its initial intent – deceptions.

Its seemingly failure as stated is not so much due to lack of good governance because ever since in the beginning it was basically “deceptively implemented” with the aim of suppression, discrimination and hegemonious economy ideas which then was looked at by the Malays as the “rise of a supreme race.” LoL.

What goes around comes around and this is what Malays deserve in the first place – planting bad seed you reap bad fruits – pure and simple.

Due to this ideology especially manufactured by the former PM all “hell break loose.”
Due to this ideology as you can witness we have idiots in the parliament defending “cesspool” – yeah in the name of religion and race that was the main deceptive platform of this policy – which has never been deviated from its bad original intentions.
Due to this policy – which can be looked at as racist and bigotry in nature – leaders never winced once in passing idiocies as truth and fact and even to the extend of hallucinating and delusional conjecturing “enemies” within which of course non other than the other more successful races.

.

20. kittykat46 - June 24, 2007

Reading from various blogs, there has been a strong reaction from Malays, especially, on the EU Ambassador’s speech. But I’m afraid many did not read the text of the speech properly.
The Ambassador in no way commented on the Malays or the political aspects of the NEP. It was very much focussed on the NEP’s economic impact on Malaysia’s competitiveness to attract foreign investment.
The world economy, especially East Asia’s economy has changed tremendously from the 1980′s and 1990′s. We are now in a very, very tight competitive fight with other regional economies for a share of FDI. Nobody owes us a living, we have to compete and survive in the world economy on our own merits. Malaysia’s ability to survive is by no means guaranteed, especially when the oil starts to run out.

Can the bumiputra NEP generation understand that ?

21. Nstman - June 24, 2007

Long live Rommel. Seig Heil. Well spoken. At least you spoke the truth, unlike cowering, stupid, idiotic Malaysians who parrot the Barisan and its lackeys. By the way, Herr Rommel, send my best regards to Herr Hitler, Herr Goebbels, Herman Goering, Heinrich Himmler. May they live to a thousand years in the thousand -year Third Reich. Heil Hitler. Seig Heil.

22. monsterball - June 24, 2007

jeancumlately and millions like her did not benefit from the so call NEP..National Economy Plan? The only plan that we all saw vividly are selected malays benefiting from it. Now Pak Lah is trying to balance it up…and is accused to play same game. Sure he has to play the same game to balance things up. Who is the one doing this for 22 years?
So it is the malays that are the haves and haves not from this NEP plan….over extending it by so many years and yet everytime UMNO ministers have reasons for extentions…yet none of those toothless Alliance parties dare to say anything against it.
Keep pampering….you will produce a lazy corruputed race.
That’s the truth…the whole truth and nothing but the truth.

23. Never Ending Parasitest - June 24, 2007

Reading AAB dream for 2057 clearly put M’sia a better and more advance country than any of EU state now. AAB dream for M’sia
unimaginablem, we will have Nobel laureates, truly global corporations, respected and market-leading brands, internationally acclaimed poets and artists, among the largest number of scientific patents in the world and even the best football team in Asia. Our students and professors will dominate Ivy League universities and our own universities will be citadels of excellence for international scholars. We will be pioneers in alternative energy, drawing on our strength in biofuels. Our cities will be the most liveable on the globe, blending cosmopolitan facilities that are rooted in a tolerant and just societal ethos.

Yes come on our Malays brothers let us show the world that we the Malays has the winning fomula “NEP” and we will make it! Malayu Boleh!

24. simon wee - June 24, 2007

The objective of NEP is to be lauded. However its implementation has left much to be desired.

Instead of benefiting the privileged few with the connections the allocated share should be given to Malay cooperatives where all Malay employees should belong. This way the benefit would be spread to benefit as many Malays as possible.

At the moment the privileged few would have to resort to Ali Baba arrangements in which only the few non-Malays with connections benefit.

So the many non-Malays complain unfairly blaming the many Malays who have only their jobs to cling to.

With a shrinking economic cake the country is now experiencing as more and more foreign investors bypass Malaysia for other Asian countries such as China, Vietnam and Singapore, the dissatisfaction and frustration are growing at the expense of the many non-Malays and Malays.

Therefore it is imperative that a more equitable economic policy and formula be drawn up to benefit the many Malays and non-Malays for the continued wellbeing of the country.

In the Malaysian context, any meaningful dialogue should begin with the unequivocal acknowledgement of Malay political dominance and institutions in the country to allay Malay phobia.

An analysis must then be made to government contracts and tenders, transportation (it has been decreed as a Malay preserve), manufacturing (many non-Malay plants are unlicensed for obvious reasons) etc for the most effective and equitable ways to benefit the many Malays and non-Malays.

Without such a starting point we can talk until the cows come home, inflaming emotions unnecessarily all along the way.

25. Muhammad Yunus - June 24, 2007

It is funny that people diagnose the problem with corruption as the cause for NEP’s failure yet shouts for NEP’s abolishment and not improving good governance within it’s delivery system.

Being a Singaporean Malay, it is also amusing to hear that there are no opportunities of corruption / nepotism / cronyism in Singapore.

But now I comprehend, why, despite being able to diagnose the inherent problem of their 37 year old ‘child’, still adamantly chooses to simply put it to sleep…when comments fueled by racial hatred like: ‘Yeah…its time to bash the nep and the malays again…’ exists…or am I being over sensitive and it was just a joke?

Review of NEP can be extended to ALL the poor regardless of their color. This was even suggested by Anwar Ibrahim once. But no? I know now why…’they’ want to bash Malays…AGAIN.

26. wits0 - June 24, 2007

The DPM says he regrets the EU man interfering with Ma’sian affairs – something that can be translated in various ways….except focussing on the real point, that investment is not worth it here. All the hoo haas of politically enabled support with all the usual public obscurantist convolution must follow next. Nothing new or impressive.

27. Chee Yong - June 24, 2007

Anyone supporting NEP must be in deep frozen state, wake up brother. The Cold War has ended. And tv is not black and white anymore. NEP is just another tool for losers and greedy people that capitalize on its usage to enrich themselves and their croonies. I say down with NEP.

28. monsterball - June 25, 2007

For 50 years under the NEB concept….it is who you know and not what you know to be successful in business.
How to progress like this?
All huge businesses are monopolized by government agencies….yet they loose millions year after year.Does that not sound strange?

29. xashini - June 25, 2007

There is some good articles on NEP in DR Hsu’s forum, and also one today on the over reaction of our government. I think the opinion expressed there is worth reading: http://hsudarren.wordpress.com

30. wits0 - June 25, 2007

“Malaysia summons top EU envoy after criticism of ethnic policy”
http://www.eubusiness.com/news_live/1182762025.66

Did Rommel get that “stupid, stupid, 43X stupd” lecture like Nazri gave in the Big Corcus aka parliament? He didn’t say. Don’t think Bolehland dares.

31. Nstman - June 26, 2007

Long live Rommel. Heil Rommel, the new poster boy in the struggle against lies, stupidity, idiocy, hypocrisy, banditry, religious extremism, racism. Well done Rommel, stand your ground against your stupid critics. All right thinking Malaysians support you, and you have my unswerving and unstinting support.

32. rodsjournal - June 26, 2007

I tend to agree with wits0 that the ethos or spirit of the whole policy was flawed to begin with.

I was one of those who pointed out the corruption, but I also stated that:
“maybe, just maybe, the policy itself is self-defeating to begin with.” I gave allowance for something more/else. And wits0 articulated it.

For my two cents, Malaysia seems to be one of the few countries in the world where a majority population/ethnic group seems to have this kind of affirmative action going for them. One would have thought this sort of thing applies to minority populations.

Anyway, we’ve seen where the NEP leads to: among other things, a blatant class system and other inequalities within the very majority it was supposed to uplift. And we can’t blame it solely on…let’s see (take your pick)- racism, neo-imperialism, globalisation, etc. .

muhammad yunus, ‘jeancumlately’ doesn’t represent the majority of us, I daresay. I don’t know if this person wrote about bashing malays in sarcasm or whatever, but I don’t care too much for his/her comments either.

Incidentally, since you are a Singaporean Malay – my personal opinion is that as a minority, affirmative action should apply more to someone like you, instead of your ethno-religious compatriots elsewhere – you know, those who are mostly based on the other side of the Johor Straits.

Hmm…I may have just opened a new can of worms without meaning to. Well then.

33. Nstman - June 27, 2007

Rommel for Prime Minister. Heil Rommel. We love you.

34. ironhide - July 2, 2007

it is true that NEP only benefit a minority of well connected people. helps only a minority of malays. there are still many poor kampung folks who are neglected. did NEP reached them?NO…there are also poor people from other communities besides malays.?are they receiving any assistance?NO. why the discriminatory policy? ALL poor people from ALL races MUST receive the same treatment, not only for the malays. Politicians without brains are sitting in our parliament and talking rubbish and behaving like monkeys and they are elected again and again. i truly wonder what is wrong with BN leaders when it comes to choosing a CAPABLE candidate and not a MONKEY. and these monkeys are good at lookin at women’s clothing and local airlines’ stewardass’ uniforms and criticize. well, here ‘s a word of advice for them, this airline was built from scratch and now it is the biggest budget airline in asia planning to fly to other continents mind you, and not to mention u do not credit and appreciate their success that brought revenues and job opportunity for malaysians, but what u see is their uniform.goodness…and some others like to talk about women’s menses in parliament. and no constructive and intelligent debates. only stupidity and shoutings. they are not fit to be called Yang Berhormat. respect is earned, not merely by being called berhormat…terrible situation but it seems like nothing is changing…why are we accepting this. this is detrimental to our country…corruption which is published in papers don’t even need a hearing in the court of justice? but is considered to be internal affairs of the political party concerned, case closed. wow, political party is so big here that all laws, police, ACA, an court of justice is bypassed… is this right? is this justice>?

35. The NEP Debate: Reason Takes A Bath In The Toilet Bowl « The Naked Truth - July 3, 2007

[...] you read further, read this and especially the following comments. I posted three comments there until I realized I was [...]


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