While Malaysia fiddles, its opportunities are running dry
Michael Backman
November 15, 2006
the economy each of its two main races — the Malays and the
Chinese — owns. It’s an argument that’s been running for 40
years. That wealth and race are not synonymous is important for
national cohesion, but really it’s time Malaysia grew up.
It’s a tough world out there and there can be little sympathy
for a country that prefers to argue about how to divide wealth
rather than get on with the job of creating it.
The long-held aim is for 30 per cent of corporate equity to be
in Malay hands, but the figure that the Government uses to justify
handing over huge swathes of public companies to Malays but not to
other races is absurd. It bases its figure on equity valued, not at
market value, but at par value.
Many shares have a par value of say $1 but a market value of
$12. And so the Government figure (18.9 per cent is the most recent
figure) is a gross underestimate. Last month a paper by a
researcher at a local think-tank came up with a figure of 45 per
cent based on actual stock prices. All hell broke loose. The paper
was withdrawn and the researcher resigned in protest. Part of the
problem is that he is Chinese.
"Malaysia boleh!" is Malaysia’s national catch cry. It
translates to "Malaysia can!" and Malaysia certainly can. Few
countries are as good at wasting money. It is richly endowed with
natural resources and the national obsession seems to be to extract
these, sell them off and then collectively spray the proceeds up
against the wall.
This all happens in the context of Malaysia’s grossly inflated
sense of its place in the world.
Most Malaysians are convinced that the eyes of the world are on
their country and that their leaders are world figures. This is
thanks to Malaysia’s tame media and the bravado of former prime
minister Mahathir Mohamad. The truth is, few people on the streets
of London or New York could point to Malaysia on a map much less
name its prime minister or capital city.
As if to make this point, a recent episode of The
Simpsons features a newsreader trying to announce that a tidal
wave had hit some place called Kuala Lumpur. He couldn’t pronounce
the city’s name and so made up one, as if no-one cared anyway. But
the joke was on the script writers — Kuala Lumpur is
inland.
Petronas, the national oil company is well run, particularly
when compared to the disaster that passes for a national oil
company in neighbouring Indonesia. But in some respects, this is
Malaysia’s problem. The very success of Petronas means that it is
used to underwrite all manner of excess.
The KLCC development in central Kuala Lumpur is an example. It
includes the Twin Towers, the tallest buildings in the world when
they were built, which was their point.
It certainly wasn’t that there was an office shortage in Kuala
Lumpur — there wasn’t.
Malaysians are very proud of these towers. Goodness knows why.
They had little to do with them. The money for them came out of the
ground and the engineering was contracted out to South Korean
companies.
They don’t even run the shopping centre that’s beneath them.
That’s handled by Australia’s Westfield.
Next year, a Malaysian astronaut will go into space aboard a
Russian rocket — the first Malay in space. And the cost? $RM95
million ($A34.3 million), to be footed by Malaysian taxpayers. The
Science and Technology Minister has said that a moon landing in
2020 is the next target, aboard a US flight. There’s no indication
of what the Americans will charge for this, assuming there’s even a
chance that they will consider it. But what is Malaysia getting by
using the space programs of others as a taxi service? There are no
obvious technical benefits, but no doubt Malaysians will be told
once again, that they are "boleh". The trouble is, they’re not.
It’s not their space program.
Back in July, the Government announced that it would spend
$RM490 million on a sports complex near the London Olympics site so
that Malaysian athletes can train there and "get used to cold
weather".
But the summer Olympics are held in the summer.
So what is the complex’s real purpose? The dozens of goodwill
missions by ministers and bureaucrats to London to check on the
centre’s construction and then on the athletes while they train
might provide a clue.
Bank bale outs, a formula one racing track, an entire new
capital city — Petronas has paid for them all. It’s been an
orgy of nonsense that Malaysia can ill afford.
Why? Because Malaysia’s oil will run out in about 19 years. As
it is, Malaysia will become a net oil importer in 2011 —
that’s just five years
away.
So it’s in this context that the latest debate about race and
wealth is so sad.
It is time to move on, time to prepare the economy for life
after oil. But, like Nero fiddling while Rome burned, the Malaysian
Government is more interested in stunts like sending a Malaysian
into space when Malaysia’s inadequate schools could have done with
the cash, and arguing about wealth distribution using transparently
ridiculous statistics.
That’s not Malaysia "boleh", that’s Malaysia "bodoh"
(stupid).
Source:
http://www.theage.com.au/news/business/while-malaysia-fiddles-its-opportunities-are-running-dry/2006/11/14/1163266550487.html?page=fullpage#contentSwap1
