Prime Minister Najib Razak has told the Bumiputera Economic Congress they should not fear that their rights will be eroded under the New Economic Model (NEM).
He also stressed the need to be fair to the non-bumiputera. All this is well said and his assurance is most welcome. Najib’s reassurance to the hundred-plus Malay NGOs on May 29 has been necessary as they had said that they could not accept the NEM. But why is this so?
Apparently many at the congress held in the Putra World Trade Centre – where speaker after speaker denounced NEM as being anti-Malay – also expressed the fear that the policy would not look after their special interests as was intended by the New Economic Policy (NEP).
Now this is strange as the NEM differs little from the NEP in some important respects. The NEP sought to alleviate if not eradicate poverty regardless of race and also to remove the identification of race with occupation.
The NEM in fact spells out more clearly that it would aim to reduce poverty for the lowest 40 percent of the income groups. This is an advance over the NEP as it indicates the cut-off point at RM1,500 per month, which is about double the poverty line income under the NEP.
However, the policy’s restructuring goal is not elaborated upon as in the NEP and this may have caused some problems in the minds of many who attended the congress.
Nonetheless the most salient question asked by positive-thinking Malaysians is why has the NEP been extended well beyond the 20-year period that it was originally planned for.
NEP has a shelf life
By 1990 the NEP was to have ended. Yet there was no real consultation or consensus when it was arbitrarily extended.
Currently Malaysians are asking another critical question: How long more do the Malays want the NEP? Many a right-thinking Malay is pondering on whether the NEP with all the abuses in its implementation will benefit the majority Malays or the minority elite groups of all races?
Indeed the government should phase out the NEP as a matter of priority because the policy’s restructuring goals have been achieved and overreached. So what more is expected and how far more must we go, before we really get stuck in the middle-income trap, with little hope to break out of it?
Unless we adopt the NEM soon and work hard to carefully monitor its implementation and ensure its success, we may decline and fail to
meet our ambition to become a united and progressive nation.
The NEAC probably found out that if you take a professional look, and not an emotional or political view of this sensitive issue, then it would be possible to challenge the popular and publicly promoted notion that bumiputera equity ownership is only about 20 percent of the whole corporate sector.
Thus it could be argued that if you took the markets pricing and the large equity owned by the government-related companies (GLCs) – which are to all intents and purposes privately run business entities – then the bumiputera corporate equity ownership could be well over 30 percent!
In this case, there is no need to give priority to this aspect in the NEM or in preparing for the 10th Malaysia Plan.
That is why the foreign investment committee (FIC) was dismantled and why the government was able to liberalise some 27 sectors of the service industry.
Notwithstanding the above, the national economic advisory council (NEAC) ought still perhaps to have explained clearly why the 30 percent bumiputera equity ownership was not more fully discussed in the NEM.
Shift in emphasis
Actually the emphasis of the country’s economic forward planning has changed, and rightly so, to more rapid development of human resources and particularly professional and skilled labour.
It had also been realized earlier that there is no point in bumiputeras owning the bulk of the corporate shareholding if the top management is in the hands of non-bumiputera.
With more trained bumiputeras employed in all the professions and in the multifarious skilled jobs that are essential for a rapidly growing and advanced developing economy, the bumiputeras would surely be well represented in ownership and employment in the private sector as they are in the public sector.
In fact the data on Malay participation in the higher level occupations should be made publicly available so that the Malay NGOs do not need to feel so insecure or envious. This Malay participation in the top professions in the country is one of the great successes of the NEP.
On the other hand, the public sector with its 1.2 million mainly Malay civil servants was to have been restructured to reflect Malaysia’s racial composition. A more ethnically balanced bureaucracy would better instill a sense of belonging and support of the racial mix of our various communities.
Instead the Malay dominance in the public service and even in the GLCs has become even more pronounced today. So there has been no balanced approach to employment in the public and private sectors as the latter now has a far higher proportion of Malays than we have ever had before!
Hence for NEM, it is necessary now to emphasize merit and excellence rather than focusing on racial criteria.
Meritocracy for improvement
A fresh strategy of meritocracy contained in the NEM would ensure sustainability of the bumiputera’s active and meaningful participation and leadership in the business sector.
Otherwise as during the NEP, a lot of crony capitalism would be inadvertently nurtured via the pink forms for new share issues, and negotiated tenders given out to inexperienced contractors. All these deviations under NEP led to much wastage and corruption that have mainly caused Malaysia to fall into the middle-income trap for several years now.
The NEM also is superior to the NEP in that it promotes more competition, meritocracy and transformation of the delivery system which had undermined the originally sound government policies.
The Prime Minister also has pushed for more transparency and open tendering. This would of course help to remove the rentier class of opportunists. These were mostly unproductive contractors who irresponsibly farmed out their contracts for commissions, without any value-added effort.
But these NEM reforms, although so essential to enable Malaysia to break out of the middle-income trap and move forward, would inadvertently break the golden eggs of the rentier class who are mainly political personnel that throve on doing so little for so much personal and easy gain!
Hence it is understandable, although not justifiable, for these types of individuals to try their best to criticize and condemn the NEM.
The danger is that they may persuade the mass of the people who will not benefit from cronyism to resist the introduction of the NEM in its present prudent form.
This is why it is imperative for all true Malaysians, as opposed to opportunistic and selfish individuals with narrow vested interests, to rally around the solid policy proposals of the NEM.
Determining the future
Public support can help ensure that the government has the full endorsement of the silent majority to get the NEM going soon.
The trouble is that too many Malaysians merely grumble and grouch but do so little to publicly express their dissatisfaction and even disgust at the often irresponsible pronouncements and performance of rightists and extremists among us.
Therefore, if the vast silent majority chooses in the main to remain complacent or even indifferent, then the persistent cries of the minority who are vociferous could well prevail.
We deserve the government we get because we can indeed influence change for a better Malaysia. Please think and act upon what has been said by the analysts.
If NEM fails, it will be a tragedy as Malaysian is a truly blessed country. Its peoples have been given the challenge and the chance to be a model multiracial, multi-religious and developed nation for all Malaysians to enjoy, and indeed for the world to see, learn and admire.
How very sad indeed if this country and its citizens were not to succeed in realizing our great potential.
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Related article:
‘Malay nationalists trash premier’s economic plan’ (in the Asia Sentinel)
