Sunday, September 24, 2006
A contentious issue that is the NEP
The ubiquitious fish bone in the government's throat - the National Economy Policy - continues to remain uncomfortably lodged between the proverbial rock and a hard place. The United States have already called for a "level playing field" in the arena of trade between itself and Malaysia in ongoing discussions to put a Free Trade Agreement in place. Alarm bells are ringing in the corridors of power in Malaysia as the ramifications of such a deal are being belatedly digested. The bumiputera control in many strategic sectors such as government procurement, telecommuncations, oil and gas may be forced to loosen up and let the white man get a piece of the pie. Malaysia is mulling over this profound dilemma and its no surprise that we are dragging our feet in signing the FTA with the US. The sacred cow that is the NEP - the raison d'etre of UMNO - is at stake. If we do not agree terms with the US, the White House has warned Malaysia that bilateral ties will suffer and consequently, American investments here will be impaired.
Such demands by the Americans might have been easily parried ten years ago but the world is a different place now. The rise of China, India and now Thailand and Vietnam is tightening the screws on us. Foreign direct investments into Malaysia is a topic not touched upon by politicians nowadays. Ten years ago, the Minister for International Trade Datuk Seri Rafidah Aziz was travelling the length and width of the country to open new factories and plants set up by foreign cash. Such fanfare is a thing of the past now.
Domestically, the call for the NEP to be removed is getting louder. Barisan Nasional component party Gerakan has repeatedly voiced this call as well as the Opposition parties. Economists have also given their two cents worth on this matter. Now a new study by the Asian Strategy and Leadership Institute (ASLI) have stated in a study that the primary objective of the NEP to raise Bumiputera corporate equity ownwership to 30 percent has already been exceeded. The correct number, it says, is 45 percent.
ASLI argues that the NEP has already achieved its objective of creating a Malay business community and a strong middle class. Over the long-term, if the NEP is continued in its present form, the government would have a far more difficult task in the near future, in protecting national interests. This is because the imposition of a complex, artificial mechanism on the domestic socio-economic platform, will inevitably impact the country's external relations and the economy. It would seem that that time is approaching. While the government keeps stating publicly that it will continue the NEP in its present form till 2020, I wonder if the government is actually performing a huge disservice to the Malays by giving them such unreasonable expectations when the global economy is breaking down barriers in other nations.
It would be duplicitious of the government to keep championing the NEP in its present form. The pyschological umbilical cord that has compelled the Malays to assume a dependency culture must be removed, so that the country as a whole can embrace external challenges. I believe what the ASLI study is saying is that there is already a large business-minded Malay community (thanks to the NEP) that can be even more robust by facing open competition. The alarm bells have already been sounded. UMNO must have the political will to do the right thing. It is best that UMNO takes this action on its own terms now than remain in a state of paralysis until it is forced to do so by conditions imposed by outsiders. ¶ 3:28 PM
Such demands by the Americans might have been easily parried ten years ago but the world is a different place now. The rise of China, India and now Thailand and Vietnam is tightening the screws on us. Foreign direct investments into Malaysia is a topic not touched upon by politicians nowadays. Ten years ago, the Minister for International Trade Datuk Seri Rafidah Aziz was travelling the length and width of the country to open new factories and plants set up by foreign cash. Such fanfare is a thing of the past now.
Domestically, the call for the NEP to be removed is getting louder. Barisan Nasional component party Gerakan has repeatedly voiced this call as well as the Opposition parties. Economists have also given their two cents worth on this matter. Now a new study by the Asian Strategy and Leadership Institute (ASLI) have stated in a study that the primary objective of the NEP to raise Bumiputera corporate equity ownwership to 30 percent has already been exceeded. The correct number, it says, is 45 percent.
ASLI argues that the NEP has already achieved its objective of creating a Malay business community and a strong middle class. Over the long-term, if the NEP is continued in its present form, the government would have a far more difficult task in the near future, in protecting national interests. This is because the imposition of a complex, artificial mechanism on the domestic socio-economic platform, will inevitably impact the country's external relations and the economy. It would seem that that time is approaching. While the government keeps stating publicly that it will continue the NEP in its present form till 2020, I wonder if the government is actually performing a huge disservice to the Malays by giving them such unreasonable expectations when the global economy is breaking down barriers in other nations.
It would be duplicitious of the government to keep championing the NEP in its present form. The pyschological umbilical cord that has compelled the Malays to assume a dependency culture must be removed, so that the country as a whole can embrace external challenges. I believe what the ASLI study is saying is that there is already a large business-minded Malay community (thanks to the NEP) that can be even more robust by facing open competition. The alarm bells have already been sounded. UMNO must have the political will to do the right thing. It is best that UMNO takes this action on its own terms now than remain in a state of paralysis until it is forced to do so by conditions imposed by outsiders. ¶ 3:28 PM
