The big Napoleons

JULY 26 — There is always a big Napoleon behind the little Napoleons.

It is said that it was a little Napoleon’s idea to forbid national secondary schools from having non-Muslim societies.


The little Napoleon said that any school intending to form non-Muslim societies must first get consent from the state education director, according to an Education Ministry circular dated December 16, 2000. Non-


Muslim societies formed without consent must be shut down as it was a violation of the law.


As a result, Deputy Prime Minister and Education Minister Tan Sri Muhyiddin Yassin came forward to clarify that the circular was issued on December 16, 2000 and thus, all non-Muslim societies formed before that date would not be affected.


“You can take my word for it,” he said.


Yes, three non-Muslims clubs — Kelab Agama Hindu, Kelab Agama Buddha and the Christian Union — at the Klang High School can continue their operation.


A historical problem has been resolved.


However, how about the present and future problems?


For example, could secondary schools form non-Muslim societies now, I mean, after December 16, 2000?


Also, does it mean that all national secondary schools have not been allowed to form non-Muslim societies over the past decade?


Sorry, I think I have asked the wrong person. It may have nothing to do with Muhyiddin, as according to the circular, schools must first get consent from the state education director before they can set up any non-
Muslim society.


They cannot shut down the existing non-Muslim societies but it should be okay not to allow the formation of new non-Muslim societies as it is the power of the state education director for not approving the applications.


This is strange. Why non-Muslim societies formed before 2000 can be accepted but special permission is required after 2000?


Could it be because the non-Muslim societies formed before 2000 were more in line with the multi-racial national condition of Malaysia, able to promote good social atmosphere and instil correct values in students?


And such societies formed after 2000 could undermine the multi-racial national condition, harm the society and instil inappropriate values in students?


Perhaps, it is how the little Napoleons think. And such kind of information is provided by a big Napoleon.


The “big Napoleon” that I am referring to may be the manipulator who issued the circular, or someone in the state education department who is responsible to implement the circular. It may also appear as an ideology that views all non-Muslim activities with a narrow vision.


There are little Napoleons only when there is a big Napoleon.


Today, everyone, including both the ruling and opposition parties, is blaming the little Napoleons, saying that they are making trouble.


However, everyone seems to tolerate the big Napoleons, and blame only the little Napoleons whenever there are problems.


The British were afraid of Napoleon Bonaparte 200 years ago and thus, they exiled him to St Helena Island, which is located in the Atlantic Ocean, about 2,000km to the west of Angola.


Napoleon had no choice but to spend the last six years of his life on the island doing nothing, except watching seabirds.


It seems that our big Napoleons should also be isolated or exiled. Of course, we do not have any small island like St Helena. However, it is also good to leave them in an air-conditioned office room so that they can live a leisure life. — mysinchew.com

Under BN this is what we get........

Country in the red as 2009 FDI nosedives 81%

A nosedive in foreign direct investments in Malaysia in 2009 follows a continued downward trend in FDI, increasingly overshadowed by regional players, noted a United Nations report.

According to the World Investment Report 2010 unveiled today, FDI plunged 81 percent from US$7.32 billion (RM23.47 billion*) in 2008 to just US$1.38 billion (RM4.43 billion) last year.

(*Calculated based on exchange rate of US$1 = RM3.20650)

The 2009 FDI is less than half of the annual average FDI inflow between 1995 to 2005, which encompasses the long recovery period following the 1997 economic crisis.

Malaysia’s performance also pales in comparison with neighbouring economies like Thailand and Indonesia whose FDI figures did not contract as severely, despite the global financial crisis.

Thailand suffered a decline of US$4.44 billion (RM14.24 billion) while Indonesia saw a more modest drop of US$2.60 billion (RM8.32 billion) in foreign investments in 2009.

The severe dip also places Malaysia in the red for the first time in  the last 15 years, with figures for cumulative FDI (see chart right) surpassing incoming investments by about US$1 billion (RM3.21 billion).

Doubts over high income target

Speaking at the UN Headquarters in Kuala Lumpur today, Universiti Malaya economist Rajah Rasiah  said that Malaysia’s poor performance casts doubts over whether it can achieve the targets set to achieve high income status.

“Malaysia is fortunate to be in a good neighbourhood, located among growing countries. The three largest recipients of FDI are located in Asia (but) Malaysia does not even make the top 10 list of recipients,” he said.

He added that this is remarkable for a country with a specific FDI policy, unlike Taiwan which is placed 10th in the list.

Conversely, Malaysia is “doing well in FDI outflows”, ranking fifth in the list of South, East and Southeast Asian countries investing abroad.

“Speaking to fund managers, I get the impression that we have the resources to invest locally but not many viable options to do so. Even local investors find us less attractive,” he said.

Human capital a barrier

The main stumbling block, he said, remains our narrow human capital pool which leaves industries stagnating in low-end production.

He added that while foreign investor laud the ease of doing business in Malaysia, a lack of skilled labour, research and development and technological capabilities is placing the country on the losing end of the increasingly competitive FDI battle.

Malaysia has 300 to 400 science and technology workers for every 100,000 persons, as opposed to 3,000 in countries which made the transition from middle to high income status, he said.

Similarly, the country is under-investing in research and development at only 0.64 percent of GDP, while others like Taiwan and South Korea are investing about 3 percent of theirs.

It should also look at mirroring such nations in developing a “vetting mechanism” for FDI to ensure that the investments can be a catalyst for human capital and technology development.

This will include screening FDI by choosing those with technologies that could be upgraded along the value chain and monitoring to ensure a transfer of expertise takes place.

“We allow foreign firms in by giving grants and tax incentives, so we must ensure that spillovers (in terms of technology transfers) occur,” he said.

The bottom 40 percent of the population should also be assisted insofar as developing their skills to meet the shortage in industry.

“In assisting the lower income population, we should look at developing skills like precision engineering and die casting, which are sought after by foreign investors,” he said.

Aidila Razak/Mkini

World's Best Tax Havens

By Richard Murphy

In Pictures: Top 10 Tax Havens

Even if you've worked for some years trying to prevent the problems caused by tax heavens, people will still ask you which places are the best in the world to shield your money from taxes. Working with the Tax Justice Network I set out to provide a definitive answer.

"Best" is, of course, a pretty subjective term, so it needed definition. We used two. The first was a measure of a place's opacity, or how secret it is. There's good reason for that. Some time ago I gave up trying to define what a tax haven is, as that proved to be a pretty thankless task. Instead I suggested that unless a place is a secrecy jurisdiction, which means that regulation is intentionally created for the primary benefit and use of those not resident there, it really can't operate as a tax haven. In effect, secrecy jurisdictions create regulation that is designed to undermine the legislation or regulation of another jurisdiction.

To facilitate its use, secrecy jurisdictions also create a deliberate, legally backed veil of secrecy that shields the identities of those making use of its flexible regulatory system. This is important. Even though people who use secrecy jurisdiction claim their activities are perfectly legal, it seems they don't want people to find out about them. So secrecy is a key.

Secondly, enjoying secrecy in a place that does not have the know-how to handle money is not of much use if, like most users of secrecy jurisdictions, you want to move money without too many questions being asked. That's why we added another criterion, a pretty simple one: To be considered significant, a place had to have the capability to move money in serious quantities, or it just didn't rank.

These two characteristics, when combined, create an index of secrecy jurisdictions, or tax havens if you prefer, called the Financial Secrecy Index.

The research was fascinating. First we had to determine what places were secrecy jurisdictions. To do this we created a "list of lists" looking at tax haven listings over a period of more than 30 years and selecting for testing, broadly speaking, all those that came on two lists or more over that period. Then our team researched data on a wide range of issues--about 200 variables per location

Twelve criteria were then selected as key indicators of opacity, varying from whether there was formal banking secrecy or not, to whether accounts were required to be on public record, to how many tax information exchange agreements the jurisdictions had. The place got a mark for being opaque and none if it was transparent. This produced a list of the usual suspects: Switzerland, Malaysia (Labuan), Barbados, Bahamas, Vanuatu, Belize, Brunei, Dominica, Samoa, Seychelles, St Lucia, St.Vincent  and Grenadine, and Turks and Caicos.

Next we had to determine the amount of cash flowing through each location using International Monetary Fund data. The top 10 here were:

The U.K. (City of London), the U.S. (Delaware), Luxembourg, Switzerland, Cayman Islands, Ireland, Hong Kong, Singapore, Belgium and Bermuda.

Of course we're not saying that all of this cash is illicit--far from it--but if you're going to hide illicit cash, where better to do it? Where it stands out from the crowd, or where it can be lost like a needle in the proverbial haystack? Big numbers help the owner of dubious cash lose theirs in the crowd, and the places named above are big.

Combine the two rankings (deploying a little mathematics along the way, I admit) and you get the overall top 10 list. These are the 10 most significant secrecy jurisdictions in the world, in the opinion of the Tax Justice Network: the U.S. (Delaware), Luxembourg, Switzerland, Cayman Islands, the U.K. (City of London), Ireland, Bermuda, Singapore, Belgium and Hong Kong.

That final list is going to surprise, shock or even annoy a lot of people, but there is good reason for listing places like London and Delaware as tax heavens among those which might be considered the more usual suspects.

Secrecy is not something, as many like to think, that happens "over there." It is really happening at home too. Delaware provides a degree of corporate secrecy for those who operate there that makes it highly significant. Incidentally Nevada and other states also offer this feature, but because more companies use Delaware, it stood out from the crowd.

A growing economy but shrinking incomes?

By Sheridan Mahavera

July 21, 2010

For the average Malaysian, figures like the 10.1 per cent GDP growth remain an abstract. — file pic

KUALA LUMPUR, July 21 — Noraishah Abu Bakar has heard that the economy is growing. By how much, she cannot remember. But she is fairly confident that it is as she hears it on the nightly news.

Yet she says this with a hesitant tone.

“Ya lah, kita dengar… tapi … (Yes, I heard about it, but)” And it is what comes after that is most telling about how she really feels.

“... Kita tak rasa (we don’t feel it)”.

This last sentiment does not usually follow those rosy announcements of 10.1 per cent economic growth in the mainstream media by government officials.

Neither is the real-world context presented when those same ministers boast about Malaysia moving up the competitiveness scale. For what does “being more competitive” really mean to the millions of ordinary Malaysians trying to make a living?

For Noraishah, these announcements are accepted at face value but what really matters to her is how she and her 40-year-old husband are struggling to make ends meet.

Their combined RM3,300 income is not going as far as it once did about a year ago, and they are worried about providing for their three school-going kids.

“Prices for food and clothes keep going up every six months and now I hear that fuel is going to go up because they are cutting subsidies,” laments the 38-year-old clerk.

Many of the shoppers at a morning market in the working-class neighbourhood of Section 6, Shah
Alam expressed the same concern — that their monthly incomes are barely keeping them afloat.

There apparently is a disconnect between the buoyant announcements coming out of Putrajaya and the furrowed looks of Malaysians earning less than RM3,000 a month.

For if the economy is steaming ahead, then why are families not feeling it?

People are yet to feel the effects of Malaysia’s economic growth.

Statistics “lie”

Figures like growth rates and gross domestic product (GDP) numbers are actually bird’s eye views of the economy, explains Datuk Paul Selva Raj.

“They measure things like the total goods a country produces, its total exports, how much cash and debts it has.

“They do not explain how people are doing financially and how they feel about the economy,” says Selva Raj, of the Federation of Malaysian Consumer Associations (Fomca).

It will take time for such numbers to have an actual effect for the man on the street, in terms how much their salaries can buy and whether the wages themselves will go up, he explains.

Though the noises coming out of Putrajaya may seem buoyant, public sentiment is still cautious.

This, even when there has been a lot of talk lately that Malaysians are becoming more confident in the Najib administration’s stewardship of the country.

A widely-quoted poll conducted by the independent Merdeka Center in May showed that 52 per cent of the Malaysians surveyed felt that the country was moving in the right direction. This was an increase from a March 2009 poll, when only 29 per cent of respondents thought the same.

Of those who thought that things were better, 21 per cent said it was because of the “economy turning better and the increase in people’s quality of life”.

Worsening racial relations was the main reason given by the 34 per cent who thought the country was heading in the wrong direction.

As with the big economic numbers, says Merdeka Center director Ibrahim Suffian, the poll results in themselves do not tell the whole story.

“We’re not out of the woods yet”

Pollster Ibrahim says despite the positive numbers, public sentiment remains shaky.

“Right direction,” Ibrahim says, is more of a feeling of relief rather than being cheerful about economic conditions.

“If you look at the details of how people feel about the economy, it’s not that strong.”

They are relieved that the economy did not tank like many countries during the recession, Ibrahim says, but a lot of them are still finding it tough to make ends meet.

Only 50 per cent of those surveyed felt the economy was doing favourably. About 52 per cent were unsatisfied with job opportunities.

But the most telling is the 75 per cent who said the prices of goods and services were unfavourable.

A 2007 study by the Statistics Department, says Ibrahim, showed that 62.1 per cent of Malaysian households were earning less than RM3,000 a month.

Of that number, 41 per cent earn below RM2,000 monthly according to the 2007 statistics.

“For a couple with two kids, a house and a car earning RM3,000, there’s not much left over in month after they spend it all on the basics, such as food, water, clothing and rent.”

It is difficult to imagine how households earning RM2,000 a month are staying afloat. For Center for Policy Initiatives researcher Jayanath Appudurai, there is an urgent need for the way we measure poverty.

Currently, only households earning below RM763 in the Peninsula are considered to be living below the poverty line, otherwise known as Poverty Income Line (PLI). The PLIs for Sabah and Sarawak are RM1,048 and RM912, respectively.

The question is whether RM763 is realistic. Under the government’s definition, this amount is sufficient to meet eight basic needs for a household. It includes food, utilities, clothing and rent.

“But what about RM900, RM1,000 or even RM1,500? Can a family of four be expected to live on that for a month in Malaysia?” asks Jayanath.

Honesty is the only policy

It is well and good to present a rosy picture to foreign investors about the country’s GDP and growth rate.

But those investors are not the ones who are going to suffer once the government cuts subsidies.

That the massive RM24.5 billion subsidy bill has to be cut is certain — and the government has already begun doing so. Problem is those same subsidies may be keeping the 40 per cent of Malaysians at the bottom of the income scale from starvation and homelessness.

“Everyone knows that subsidies are not properly targeted. They are supposed to be for the poor,” says Fomca’s Selva Raj.

The biggest beneficiaries are the SUV-driving crowd that still gets subsidised petrol and buys sugar at rock-bottom prices. Yet they are the ones who complain loudest when the government talks of removing subsidies.

Before the government does trim subsidies, a system to help the poor directly — such as cash payouts and food aid — must be in place, says Selva Raj.

Again, to do this, there must be a realistic measure on who should be termed “poor”.

At the same time, the Competition Act must be passed and enforced to break monopolies in the market that keep prices artificially high, he says.

“The Malaysian consumer must also realise that they cannot always blame high prices on the government. Prices should be determined by markets.

“If sugar is expensive, then put les sugar in your Nescafe.
In essence, the only way we’ll get an accurate pulse of the economy is through honesty — in assessing poverty, having a more open market and paying for what we consume.

What Anwar's trial means for Malaysia

 

A guilty verdict would be a serious step backwards for this aspiring Muslim democracy

When I visited Malaysia last month, it was clear that not just Anwar but also most observers expect a guilty verdict in August. At that point, the question is whether he remains free on bail during his appeal or is jailed immediately. 

By John R. Malott, Wall Street JournalThe trial of Anwar Ibrahim, Malaysia’s opposition leader and his nation’s best-known and most respected international figure, is scheduled to resume this week in Kuala Lumpur.

The Malaysian press dubs the affair “Sodomy II,” for it appears to be a repeat of the Muslim democrat’s 1998-99 trials, when he was convicted on corruption and sexual charges. Sentenced to 15 years in prison, Anwar’s conviction later was overturned, and he was released after six years in solitary confinement.

As the U.S. ambassador to Malaysia when Mr. Anwar first was arrested and put on trial, everything I knew then and know now leads me to conclude that this trial also is an attempt to sideline him politically.

Already convicted by the government-controlled media, Anwar and his defense team have been denied access to the evidence that the government possesses, including police and medical reports, surveillance tapes, and even the witness list. Malaysia does not have a jury system. The verdict will be rendered by one judge, appointed by the same government that wants to remove Anwar from the political scene.

While a handful of human rights groups and some Australian parliamentarians have condemned the trial, there has been little interest at the broader international level. The Obama administration has been silent.

When I visited Malaysia last month, it was clear that not just Anwar but also most observers expect a guilty verdict in August. At that point, the question is whether he remains free on bail during his appeal or is jailed immediately.

A charismatic campaigner, Anwar led his coalition to near victory in Malaysia’s last parliamentary elections in 2008, when the opposition took 47% of the popular vote and gained 62 seats. The government’s new political game plan seems to be to put Anwar in jail and the opposition in disarray, call snap elections, and ride to victory.

Today Malaysia gets little attention in the world press. The lingering image is of an Asian economic success story, a moderate Islamic country and aspiring democracy, and a multiracial society where harmony prevails. Unfortunately, that is not the case today. Malaysia is a nation adrift. 

Once one of the world’s dynamos, Malaysia’s economy has underperformed over the past decade, with an average annual growth rate of 4.5%. Much of that growth was the result of government spending, which has pushed Malaysia’s debt level to 54% of GDP.

Foreign direct investment (FDI) has remained relatively flat over the past 15 years, while flows into Thailand, Indonesia and Vietnam have soared. To make matters worse, Malaysia experienced a net outflow of $6 billion in FDI capital in 2008.

Malaysia desperately needs to upgrade its skills base and innovation capabilities, but almost 500,000 Malaysians—nearly 2% of the entire population—left their country for good between 2007 and 2009. Malaysian experts believe most of these émigrés were skilled ethnic Chinese and Indian Malaysians, concerned by economic decline and growing racial and religious tensions.

Worried about losing political support, the ruling party has responded by appealing to the more base instincts of the country’s Malay Muslim majority.

For example, it told Malaysia’s Christians that they may no longer use the word “Allah” for God, even though the word existed in Arabic long before Islam arose. A new militant group called

Perkasa, which claims that Malay rights are under threat from the Chinese and Indian minorities, has won backing from former Prime Minister Mahathir Mohamed and other members of the ruling party.

For Malaysia and the world, there is more at stake in Anwar’s trial than whether one person is convicted. Malaysia is at a crossroads in its history. The road that it chooses matters not only for some 30 million Malaysians, but for the entire world.

The country could be a model for the 600 million people of Southeast Asia and for the entire

Muslim world, if it returns to the promising course it was on 15 years ago. But a guilty verdict for Anwar means that the corruption and cronyism that now pervades Malaysia, its lack of political freedom and its economic decline, will continue.

The country’s non-Malay citizens will continue to seek a better haven overseas.

In 1998, Anwar said, “If this can happen to me, it can happen to anyone.” That is no less true today. If Anwar is denied his freedom, then Malaysia will continue to be denied her freedom and her promise.

Mr. Malott was the U.S. ambassador to Malaysia from 1995 to 1998.

Global fund managers look to trim Malaysia holdings

By Lee Wei Lian

July 16, 2010

Datuk Seri Najib Razak’s administration has been trying to raise Malaysia’s profile as an investment hotspot. — file pic

KUALA LUMPUR, July 16 — Malaysia was the second-least-favoured destination among global emerging market (GEM) fund managers, according to a poll by Bank of America Merrill Lynch Global Research released this week.
The July survey had Taiwan, Malaysia and Chile as the most underweight markets for GEM investors. They were also slightly underweight on China due to slower growth prospects.
In financial markets, the term underweight is used by analysts to advise investors to reduce their holdings.
The findings of the survey could potentially signify a setback for Malaysia’s bid to become a more competitive destination for global portfolio investment.
The Najib administration has been trying to lift Malaysia’s profile as a destination for foreign investment to help the country achieve an average gross domestic product growth of at least six per cent per annum over the next five years, in an effort to become a high-income nation.
The country’s foreign direct investment rates have fallen faster than other regional players like Singapore and China, and at the same time, capital outflows have dampened private domestic investments. Net portfolio and direct investment outflows had reached US$61 billion (RM197 billion) in 2008 and 2009 according to official data.
Asia-Pacific fund managers that were surveyed, though slightly underweight on Malaysia, held a more favourable view of the country and were looking to cut back the most in Korea, India and Australia instead, while China, Indonesia and Taiwan were the most-favoured markets.
There was an increased pessimism among the fund managers overall on the economic outlook, with a net 12 per cent expecting weaker economic conditions over the next 12 months, as compared with a net 42 per cent expecting a stronger global economy in a survey two months ago.
The fund managers also expect China’s prospects to worsen, with a net 39 per cent expecting weaker growth, as compared with 60 per cent seeing stronger growth in January of this year.
Malaysia’s economy grew by an impressive 10.1 per cent in the first quarter of this year but the prime minister had on July 6 cautioned that growth in the second quarter could be slower due to deteriorating external circumstances.
The local stock market had been on a seven-day winning streak and neared a two-year peak before succumbing to profit-taking yesterday.
About 200 global fund managers with portfolios worth from US$250 million to over US$10 billion had participated in the Bank of America Merrill Lynch survey.

A deliberate backwardness: This is how Umno-BN stays in power

Why are the majority of the Malay and other bumiputra communities still lagging behind even though their so-called champion, Umno, has been continuously victorious in the past general elections?
By Viktor Wong, Malaysia Chronicle
Why is it that after more than 50 years of independence, the majority in the Malay and the other bumiputra communities still lag behind? Why is that after more than 50 years, they are still suffering from backwardness despite hundreds of government corporations and agencies specially established to enhance their livelihood?
Or perhaps the key question to ask should be, why are they still lagging behind even though their so-called champion, Umno, has been continuously victorious in the past general elections?

Even until now, many in these communities do not have access to the basic comforts that their counterparts in the urban areas take for granted, as a matter of right as citizens of this country. Yes, many Malays and bumiputra still live in areas that do not get water or electricity. Neither can they afford basic education for their young and have to live in old and dilapidated huts. The New Economic Policy (NEP) did not reach them at all. Why and how come?

Sadly, the answers are very much connected to how Umno brought about their continuous electoral victories and the methods they adopted to maintain their influence in the villages and other rural parts of our nation.

One of the main factors contributing to the party's success is to keep the communities they claim to represent in the dark - for decades. And we are not just talking about the lack of electricity. There is a greater darkness - from the standpoint of education, blackouts of information and distribution of deliberate misinformation.

Indeed, the rural folk have been denied the pace of development enjoyed by the town and city dwellers - quite often, it is deliberate. For example in the development of information technology, or rather, the lack of so as to make sure that the rural communities are solely dependent on government TV and RTM channels for their daily consumption of news and data. In the eyes of the official media, everything about Umno and BN is good and benevolent, all others especially Opposition Leader Anwar Ibrahim are traitors and enemies of the state.

Also, despite all the cheap funding and loan facilities offered under the so-called bumiputra schemes, special share option schemes, special economic assistance, by and large, the majority of the Malays and bumiputra do not get to tap these opportunities to create a better livelihood for themselves. Instead, the facilities end up being enjoyed only by the Umno elite and the families of the mid-level leaders. These people become wealthier and more powerful, finally entrenching themselves into the "golongan bangsawan".

What about the non-Umno members and the ordinary man-in-the-street bumiputras? No doubt, some of them have been lucky enough to get some benefits, but the fact is most of them do not. That is why the poor are still very poor today, those uneducated are still uneducated, while those living in backwardness are still totally backward.

Yet, despite these terrible conditions and outright marginalization, why do they still vote and support Umno-BN?

The reasons are simple. One of these is because they are constantly fed information and data sourced only from RTM, Utusan Malaysia and Berita Harian. No Internet - this means they are unable to get any news from opposing or independent sources. The excuses given by the government include no coverage, or coverage is too expensive, or the villagers will just have to wait.

That is the official line but what they don't tell you is that they don't really need any sudden explosion of progress in their traditional bastions of support. After all, to these Umno-BN leaders, prolonging their vested personal interests come first. As far as they are concerned, independent sources of information and news are lies anyway - defamation in disguise from traitors and so on!

So, brainwashed is the word. Malaysian villagers and rural folk, due to limited development through the decades, have been co-opted into supporting Umno-BN blindly and continuously. This is why many of the rural constituencies are still firmly controlled by Umno leaders and their local warlords. The votes for Umno are indeed 'controlled, manipulated and guaranteed' in these areas.

They are traders, not traitors!

By HWN YAUL LEN

It is an irony and certainly an injustice that those who publicly defend their vernacular educational system or fight for the legitimate right of their own racial groups are accused of not being patriotic.
And those who advocate open liberal policies and opposed protectionism are said to be treasonous
Now, even traders who made a principled stand against the implementation of what they perceived as an unfair and unjust ruling are labelled as traitors and betrayers of the nation.
However, those who have leaked national secrets, collaborated with foreign countries to undermine the country's reputation, sold their MyKads to foreigners or stole a RMAF fighter jet engines and sold it to foreigners, etc are not considered anti-national traitorous elements.
In Malaysia, the definition for “betrayer” or “unpatriotic” apparently depends on who is being referred to.
And the same goes for “national hero”, too.
Take for example, the recent Thomas Cup tournament. When the first single and first double of the Malaysian team earned two points for the country, they were not considered “heroes”. But, when the third single earned the third point that permitted the team to play in the semi-final, I heard a television host shouting excitingly: "Hero! He is the true hero of our country!"
Many people were worried about Malaysian volunteers, who were on board a humanitarian aid ship attacked by Israel while on its way to blockaded Gaza. The incidents were being extensively reported by the local media.
The hostages were finally released and, when they reurned home, they were personally greeted by the country's leaders. Also, they were called the "true heroes".
The country had spent a great amount of money to send our "astronaut" into space but eventually, he terminated the contract with the government and did not fulfil his obligation. But he was also called a national hero.
The popular definitions of national betrayer and national hero are actually quite reckless and unreasonable.
The traders, who decided not to sell sugar to safeguard the industry's interests and dignity after failing to ask for the cancellation of the unfavourable measures, were inexplicably labelled as "national betrayers".
It is simply mind-boggling to understand how an ordinary co-operative action by the small-time traders to stop selling sugar could be considered as “treason”!
The local groceries are hardly able to compete with powerful mega hypermarkets. The rulings requiring the traders to have a special licence to sell price-controlled items, and to limit the amount of sugar they are allowed to stock have caused them much inconvenience.
The government is only scratching the surface of the problem when it attempts to cut sugar subsidy indirectly by controlling the sales of it. But no matter how hard the traders try to explain to the government, their legitimate plea was unceremoniously dismissed.
Even though the government has claimed that it is practising the principles of upholding business interests and cultivating people friendliness, the discourteous way the Domestic Trade and Consumer Affairs Ministry rejected the traders’ request to review the matter is shocking, to say the least.
Moreover, the ministry’s decision to issue licences to petrol stations to trade in the price-controlled items is surely contemptuous of the significant economic role that the traders and groceries have been playing in the country for a long, long time.
The small-time traders and grocers could not and should not compromise on this matter. The only way for them to defend their dignity is to stand firm together and stop selling sugar, until the status quo is restored.
This is not treasonous or unpatriotic! The traders are simply exercising their right to have a level playing field, with just rules and a fair deal to make an honest living.

10MP injecting cash for KL 'ghost towns'

By Syed Jaymal Zahiid KUALA LUMPUR

The DAP's chief economist Tony Pua said the plan to develop the Kuala Lumpur financial district as well as other grand construction projects within the area as outlined in the 10th Malaysia Plan (10MP) is a waste of taxpayers' money.


Pua, the Petaling Jaya Utara MP, said this in support of a report by OSK Research which was published in an online news portal that said such investment was likely to create a commercial property glut.


The report said that the redevelopment of Kampung Baru could destabilise the property market around the KLCC area which is already suffering from a high vacancy rate of 17%.


“The temptation to rush into developments without any regard to the supply-demand dynamics can be very hard to resist in economic boom times.


"It will destabilise the entire market and can be calamitous to all market players in the long run,” said the report.


It stated further that the area would suffer from an overabundance of empty office spaces amid an influx of existing but yet-to-come spaces in the coming few years.


"It is very possible that the area would suffer from a property glut... this is typical of the economic framework where the 10MP is relying on the construction factor to push the economy," Pua told FMT.


The "construction factor", meaning injecting money into the economy through infrastructure developments, cannot generate income on its own, said Pua.


"It must coincide with other initiatives or you will end up creating more office spaces but having no one picking them up," he added.


Crony economics ala Mahathir


The redevelopment of Kampung Baru (right), the KL Financial District and the Sungai Besi Airport were unveiled under the 10MP by Prime Minister Najib Tun Razak in Parliament yesterday.


Pua said the projects reflected Barisan Nasional's bankrupt economic ideas where economic stimulation heavily depended on pump-priming activities.


"This is like what happened under the administration of (then premier) Dr Mahathir Mohamad. It is a simple way of fishing out projects to crony companies."


The first-term MP said much of the promised transparency under Najib's New Economic Model was invalidated by the lack of government assurance that all mega-projects in the plan will be sourced via an open tender process.


Pua argued that the cash should be invested in improving the deplorable education system and industries that ensures healthy competition and economic progress.


As much as RM230 billion will be injected into privatisation-driven activities under the new five-year plan, Najib's first as prime minister.


The sixth premier is facing a stiff test to revive the ailing economy amid opposition to his mass liberalisation efforts by internal and external political foes.

Malaysia Forex Regulations

FROM THE ECONOMIST INTELLIGENCE UNIT

Malaysia in recent years has relaxed or abolished several foreign-exchange
policies in line with the Capital Markets Masterplan launched in February
2001. Of the exchange controls introduced by the government in September 1998,
the ban on offshore trading of the ringgit was the last substantial measure
remaining in April 2010. Many analysts had expected this ban to be lifted in
2007 or in 2008, but Bank Negara Malaysia (BNM), the central bank, said on
several occasions in the past few years that the ban will end only when
Malaysia’s foreign-exchange markets are “very developed” and more “robust and
vibrant”. Although BNM has noted that the instabilities the global financial
system during 2008–09 did not augur well for further liberalisation in
foreign-exchange rules, it also has stated in early 2010 that it does not plan
to re-introduce capital controls. The 1998 controls, established following the
Asian financial crisis, never affected the operations of long-term investors
in manufacturing and related services.

Offshore entities in the Labuan International Offshore Business and Financial
Centre are considered non-residents for foreign-exchange administration
purposes. As a non-resident, the offshore entity may undertake, among other
actions, the following: obtain any amount of foreign-currency credit
facilities; invest any amount in foreign-currency assets; enter
foreign-exchange contracts involving foreign currencies with licensed onshore
banks, licensed offshore banks in Labuan and any overseas counterparty; and
buy or sell foreign currency (other than the currency of Israel) against
ringgit with licensed onshore banks for permitted purposes.

A company with Multimedia Super Corridor Malaysia status is exempt from
foreign-exchange administration requirements for transactions undertaken on
its own account. An operational headquarters (OHQ), regional distribution
centre or international procurement centre is subject to policies applicable
to a resident. In addition, an OHQ is allowed to obtain any amount of
foreign-currency credit facilities from licensed onshore banks in Malaysia,
and from any non-resident, as long as the OHQ does not on-lend to, or raise
the funds on behalf of, any resident; invest any amount in foreign-currency
assets to be funded with foreign-currency funds or borrowing; and use proceeds
of any amount from the issuance of ordinary shares through an initial public
offering on the Main Board of Bursa Malaysia for investment in
foreign-currency assets.

Resident corporations approved under the Iskandar Malaysia framework and
biotechnology companies approved under the National Biotechnology Policy (for
both, see National incentives) are allowed to do the following: pay and
receive payments in foreign currency, other than the currency of Israel, with
residents; borrow any amount of foreign currency from licensed onshore banks
and non-residents; invest any amount in foreign-currency assets onshore and
offshore; and retain export proceeds offshore.

Travellers may import or export up to M$1,000 in ringgit per person, and any
amount of foreign exchange, subject to declaration rules.

In recent years, BNM has simplified and streamlined its foreign-exchange
registration requirements. Forms for the few remaining such requirements can
be completed online at http://www.bnm.gov.my/microsites/fxadmin/index.htm.

The Anti-Money-Laundering Act 2001, Malaysia’s first legislation to combat the
movement of illegal funds, came into force on January 15th 2002.

No controls exist for repatriating invested capital, including reinvested
profits, other than nominal transfer approval by Bank Negara Malaysia, the
central bank. Transfers may be in any currency except for the ringgit and the
New Israeli shekel.

These corporate transactions do not require permission from Bank Negara
Malaysia, the central bank. Commercial banks may approve and handle overseas
payments of any amount.

For portfolio investments, exchange controls allow the repatriation of funds
by non-residents arising from the receipt of dividends, interest, rental,
fees, commissions or profits.

Since April 1st 2007 resident corporations (on a per-corporate-group basis)
have been able to obtain foreign-currency credit facilities up to the
aggregate of the equivalent of M$100m (up from M$50m). The company may use the
foreign-currency borrowing to finance overseas investment up to the equivalent
of M$10m. The aggregate limit for foreign-currency borrowing by individuals
was doubled from the equivalent of M$5m to the equivalent of M$10m; the funds
may be used for any purpose, including financing overseas investments.

There is no restriction on a resident to repay or prepay permitted credit
facilities. Any prepayment exceeding the equivalent of US$10m has to be
registered with Bank Negara Malaysia (BNM; the central bank) prior to the
prepayments.

Residents may obtain any amount of foreign-currency trade financing with an
original tenor of 12 months or less from Malaysian banks. Residents may also
receive any amount of financial guarantees from Malaysian banks or licensed
offshore banks in the Labuan International Offshore Business and Financial
Centre, and from non-residents that are not financial institutions and are
shareholders, subsidiaries, or related or associated companies.

BNM stipulates that any transfer of funds from Malaysia to or from
foreign-currency accounts maintained with a licensed offshore or overseas bank
must be in the foreign currency in which the account is maintained, not in
ringgit.

Residents must seek prior permission from the central bank to obtain any
amount of credit facility in ringgit from non-residents, including from
non-resident shareholders or directors. Residents can obtain foreign-currency
credit facilities from non-residents up to an aggregate of M$10m (equivalent)
per individual or M$100m (equivalent) on a corporate-group basis. Since
April 1st 2007 residents may use foreign currency to purchase financial
products denominated in foreign currencies but offered onshore.

Credit facilities to non-residents. Since April 1st 2004 all ringgit lending
by banking institutions to non-residents (excluding stockbroking companies,
custodian banks and correspondent banks) has had an aggregate limit of M$10m.
The non-resident may use the ringgit credit facilities for any purpose in
Malaysia, excluding financing or refinancing the purchase or construction of
immovable properties. Residents (banks and non-banks) may extend ringgit
credit facilities in aggregate up to three property loans to non-residents to
finance or refinance the purchase or construction of immovable properties in
Malaysia, excluding only the purchase of land. (Before April 1st 2004 only
financial institutions and employers were allowed to extend property loans
to non-residents.)

Since April 1st 2007 onshore licensed banks can extend an overnight overdraft
facility of any amount to non-resident stockbroking firms or custodian banks
for settling or purchasing shares listed on Bursa Malaysia (the previous limit
was M$200m). Resident stockbroking companies may extend margin-financing
facilities to non-resident clients for buying shares listed on Bursa Malaysia.
Non-bank residents may extend credit facilities in ringgit to a non-resident
up to an aggregate of M$10,000.

Licensed onshore banks may extend credit facilities in foreign currency to
non-residents for any purpose. Since April 1st 2007 non-residents can obtain
any number of residential or commercial property loans (previously, only
three).

Hedging. Residents may enter hedging arrangements with licensed onshore banks
for payments and receipts for import and export of goods and services either
based on a company’s underlying commitment or on an anticipatory basis if the
amount entered does not exceed the total amount paid or received in the
preceding 12 months. Residents may hedge capital-account transactions with
licensed onshore banks based on committed capital inflows or outflows and are
also allowed to hedge their existing holdings of foreign-currency assets.
Non-residents are allowed to hedge any inflow or outflow of funds for firmly
committed transactions.

BNM stipulates that the maturity date of the forward foreign-exchange contract
should be the expected date of receipt or payment of the underlying
transaction. If the foreign-currency receivables are received earlier, the
resident can sell the foreign-currency receipts for ringgit on a spot basis or
temporarily retain the receipts in an onshore foreign-currency account,
pending maturity of the forward foreign-exchange contract. For forward sale of
export proceeds, the maturity date of the forward foreign-exchange contract
should not be later than six months after the intended date of export. For a
forward foreign-exchange contract involving two foreign currencies, the use or
retention of the foreign currency purchased by the resident must be for
permitted purposes.

A non-resident is free to enter into a foreign-exchange contract on a spot or
forward basis with a licensed onshore bank to buy ringgit to make payment to a
resident or to sell ringgit funds arising from a committed transaction in
Malaysia. The maturity date of the foreign-exchange contracts should be the
expected date of payment or receipt of the underlying committed transactions,
and the total amount of the foreign-exchange contracts should not exceed the
expected sum of payments/receipts of the underlying committed transactions.

Swaps. A resident with a firm underlying commitment may enter into
interest-rate swaps with licensed onshore banks and licensed offshore banks in
Labuan.

The procedure for remitting royalties and technical-assistance fees is similar
to that for repatriating capital, profits, dividends and interest. Such
transfers are freely permitted, and licensees have reported no problems as
long as the original arrangement had received the required official approval.

Withholding tax on royalties and technical fees is 10%, though it may be lower
under bilateral double-taxation treaties. Tax deductions are available for
expenditures incurred in acquiring patents, designs, models, plans, trademarks
or brands and other similar rights from foreigners.

Export proceeds may be received in foreign currencies, except the New Israeli
shekel, or in ringgit from an external account. Payment must be received
within six months of the date of export. Export proceeds can be retained in
foreign-currency accounts with banks in Malaysia or at overseas branches of
Malaysian-owned banks. Since November 28th 2007, a resident corporation with
export earnings has been free to pay another resident corporation in foreign
currency for settlement of goods and services. Residents may enter a forward
foreign-exchange contract with an onshore licensed bank to sell
foreign-currency export proceeds for ringgit if the maturity of the forward
contract is less than six months after the intended date of export.

Bank Negara Malaysia (BNM; the central bank) signed a three-year currency-swap
agreement on February 8th 2009 with its Chinese counterpart, the People’s Bank
of China, amounting to Rmb80bn and M$40bn. The swap permits BNM to sell
renminbi to Malaysian importers who want to buy Chinese goods. Conversely,
Chinese importers can more easily obtain ringgit to finance their imports from
Malaysia. The facility is aimed particularly at importers struggling to obtain
trade finance as a result of the global financial crisis.

The limits on the amount of foreign currency that exporters may maintain
overnight were abolished as from April 1st 2005. Only exporters with annual
gross exports exceeding M$50m need to submit quarterly export reports.

Malaysia does not impose restrictions on import leads and lags, or on export
leads. But payments for exports must be received within six months of the
shipment date.

Investments abroad. Since April 1st 2005 residents without domestic credit
facilities can invest abroad in a foreign currency, funded either from their
own foreign-currency holdings or from conversion of ringgit funds. Since
April 1st 2007 corporations with domestic credit facilities may use their
foreign-currency funds or convert ringgit, up to M$50m per year, for
investment in foreign-currency assets (up from M$10m). To qualify, such
companies must have shareholders funds of at least M$100,000 and must have
been operating for at least one year. Individuals with domestic credit
facilities may invest abroad any amount of their foreign-currency funds or
convert up to M$100,000 per year for such purposes.

Resident unit-trust management companies may invest abroad up to the full
amount of their net asset value (NAV) subscribed by non-residents and up to
50% of their NAV per fund subscribed by residents (up from 30% prior to
April 1st 2007); since October 1st 2007 they may also invest the total amount
of Islamic funds under their management in foreign-currency assets. Resident
insurance companies may invest abroad up to 5% of their margin of solvency.
Takaful (insurance based on Islamic principles) companies may invest abroad up
to 5% of their total assets. Both resident insurance companies and takaful
companies may also invest abroad up to 50% of the NAV of investment-linked
funds that they market (up from 30% prior to April 1st 2007). Fund and asset
managers may invest abroad up to the full amount of their investments by
non-resident clients, and up to 50% of their investments by resident clients
with domestic credit facilities (up from 30% prior to April 1st 2007).

Since April 1st 2007 resident and non-resident corporations listing shares
through initial public offerings on the Main Board of Bursa Malaysia (the
national bourse) may use any amount of the proceeds abroad.

-0- Jun/04/2010 22:16 GMT