Bumi Equity - a Never Ending Story

PM AAB rejected the findings of ASLI that bumi equity has surpassed the 30% mark (in fact even averring that has reached as much as 45%). He criticised ASLI’s study as being based on unreliable information, and condemned ASLI for irresponsibly publishing its provocative findings.

One of AAB’s arguments in rejecting ASLI’s report refers to the think-tank use of only 1000 companies when it ought to have followed the EPU’s methodology of looking at 600,000 companies. But AAB didn't mention ASLI's complaint that no one knows what secret methodology the government uses, as it's covered by the OSA.

Anyway, AAB's reference to the now-revealed methodology (partly revealed to reject ASLI's study, even though we don't know whether that was the actual methodology used to arrive at the 18.9% equity figure) sounds suspiciously like one of economist Datuk Zainal Aznam Yusof’s contention against ASLI's findings, which the economist published in a letter to the NST. Hardly surprising as the Malaysian economist would undoubtedly be one expert that AAB would refer to.

However, on Datuk Zainal Azman’s argument, Malaysiakini posted a letter by Khoo Kay Peng who defended ASLI’s report against the economist arguments point by point. Read here for more. The following paragraph is a snapshot of what Khoo wrote:

Dr Zainal Aznam Yusoff’s skepticism of Asian Strategy and Leadership Institute’s view that the bumiputera equity ownership is 45% was not supported by convincing counter arguments. His response in the New Straits Times has created doubts about his real motive because a truly professional economist like himself would not have made such weak technical arguments.

Ouch!

But regardless of whether bumi equity has reached only 18.9% or exceeded 45%, KTemoc opines that the NEP will continue forever, as it holds the key or passport to instant riches for the privileged few.

P Ramasamy wrote in Malayisakini about the NEP as a Never-Ending-Policy. Some extracts from his article follows:

Khairy Jamaluddin, the controversial son-in-law of the Prime Minister of Abdullah Ahmad Badawi, thinks that the NEP should be continued. Last year during the Umno General Assembly, he said that since Malays have not attained the NEP target of 30 percent, the policy should be sustained.

Malaysians are not really surprised by Khairy’s statement on the NEP. After his father-in-law became the Prime Minister in October 2003, he has become a millionaire. Obviously the NEP has benefited persons like Khairy and other members of the Malay elite with close political connections.

[…]

In a more broad sense, it has become a useful mechanism for Umno to dish out patronage in the form of business licenses, permits and contracts in return for political support. This would explain why it is so difficult for Umno leaders to discontinue the NEP as such a move would strike at the very core of its patronage system.

The on-going spat between Mahathir and Abdullah also touches on the NEP. While outwardly it appears that Mahathir is angry with Abdullah for not continuing with some of his policies, at a deeper level, there is the economic question.

[…]

The NEP introduced in the 1970s to promote integration in Malaysia has failed. It has been hijacked by a small group of Malay elite for their own enrichment, without taking into consideration the larger Malaysian mass.

Even talking in ethnic terms, generally Malays have not benefited from the NEP; recent studies indicate the gap between the rich and poor in the Malay society has increased. In other words, the class bias of the NEP is rather blatant and vicious.

In terms of national integration, the NEP in the hand of cronies and those who benefit from political patronage is hardly equipped to deal and resolve the larger national question. On the contrary, the NEP has served to embitter the non-Malay communities so much so there is little incentive for them to contribute effectively to the development of the county.

You can bet the ruling elite and their henchmen will defend the NEP in its present form or, if there is a future version, certainly without much changes.

KTemoc opines that the NEP, be that as it may as a Never-Ending-Policy, has beneficial social values PROVIDED it becomes a need-based policy rather than a race-based policy.

That way, the poor bumis will continue to be supported BUT the middle class and rich bumis, the likes of the 9.2 Million-Dollar Man, Khairy Jamaluddin and company, will be excluded. The policy can also embrace the needy such as marginalised non-Malays – in fact the word ‘marginalised’ will disappear as the NEP will be looking after all NEEDY Malaysians, and not one particular race including its already very-wealthy.