By Clara Chooi
Dzulkefly claimed the NEM 2 is plagued by racial considerations and contains elements of Perkasa’s influence in it. — File pic
KUALA LUMPUR, Dec 4 — Opposition lawmakers have trashed Datuk Seri Najib Razak’s much-anticipated New Economic Model 2 (NEM) report as a “disappointment”, accusing the premier of pandering again to the powerful will of Malay right-wing leaders and failing to deliver his own promises of reform. The Pakatan Rakyat (PR) leaders argued that the report merely comprised romantic-sounding measures that were haunted by the race-based policies of the past and was nothing less than a repeat of the contentious New Economic Policy (NEP) that ended in 1990 but furthered under the New Development Policy (NDP) initiated by former Prime Minister Tun Dr Mahathir Mohamad.
As an example, they pointed out, one resounding factor to indicate Najib’s fear of upsetting status quo was the administration’s continued silence in the scrapping of the 30 per cent Bumiputera equity target, which they noted had not been addressed in NEM 2.
One PAS MP even said that Najib’s NEM 2 had clearly been deeply influenced by Dr Mahathir himself and controversial Malay rights group Perkasa, of which the former premier is patron, which had played a pivotal role in thwarting the administration’s past attempts to reform affirmative action and promote inclusivity.
Thus, despite months of hope and anticipation, the leaders predicted that NEM 2 would eventually become yet another documented proof of the Barisan Nasional’s (BN) failure to bolster an economic turnaround.
“The entire nation was looking forward to NEM 2. It was supposed to enamour, to expound on NEM part one, which had somehow captured at least certain aspects of the nation’s expectations to turn the economy vibrant.
“But from the impression that I got, NEM 2 was watered down and mellowed by way of Najib’s commitment to change and reform on the issue of inclusivity, merits and meritocracy,” Kuala Selangor MP Dr Dzulkefly Ahmad told
The Malaysian Insider.
“It is not just about reform, but also that his approaches need to be more focused on gaining more foreign direct investments, addressing the malaise of the economy and turning Malaysia into a high-income nation,” the PAS lawmaker said.
He accused Najib of allowing himself to dither on his dreams for Malaysia through being “hassled” by Perkasa, Dr Mahathir and certain personalities within the ruling Umno party.
“They reminded him to be mindful of affirmative action so he ended up being neither here nor there. He has introduced big words, saying we are ‘market-friendly’ but they are jargons.
“When you really want to propel the economy into one that is globally competitive, it has to be on a level playing field, it has to be about opening up to more contests and competition among genuine enterprises and entrepreneurs,” he said.
Dzulkefly claimed that the NEM 2 was clearly plagued by racial considerations and contained elements of Perkasa’s influence in it.
“On the one hand you speak about opening up and liberalisation but in the same breath you stifle competition, you do not create the opportunity to allow the creation of genuine wealth and entrepreneurs,” he added.
Charles expressed doubt over the Najib administration’s commitment to actual reforms. — File pic
DAP’s Klang MP Charles Santiago also reminded that while the question of Bumiputera equity had been raised in NEM 1, it had not been addressed in the government’s Economic Transformation Programme (ETP). “The recommendation made in the NEM on the Bumiputera equity issue and also the purported distribution of wealth and the upgrading of skills for the 75 per cent of Malaysians whose educational qualifications are less than SPM even, these were not addressed in the ETP or even the Budget 2011,” he told
The Malaysian Insider.
In NEM 2, Charles noted that the premier had underlined several key factors like modernising labour laws, public sector reforms and deregulation and liberalisation as the basis for competing in the global market place.
Despite recognising that these were important issues, Charles expressed doubt over the administration’s commitment to actual reforms, pointing out that this was proven through past policy reversals.
“The recommendation on the need to modernise labour laws is not a new one. It has been in the public domain for the last 15 years, just like the national race consultative council has been,” he jibed.
As an example, Charles noted that in the government’s minimum wage policy addressed in Budget 2011, the administration had noted that minimum wages for security guards would be between RM500 and RM700.
“Ironically, the initial proposal was RM1,200 but after pressure from employers, it was dropped in the Budget to RM500 to RM700. But RM700 is the poverty cut-off point. So are you saying that minimum wages should be set at the rate for poverty?” he said.
He added that the country needed to move away from relying on government net growth to domestic growth to revitalise the economy and one of the urgent measures needed to realise this was through a better minimum wage policy.
“We need to boost our local industries and if we have minimum wages for the worker, we will have extra money floating in the market. This will result in a multiplier effect and give room for future expansion of our local industries,” he said.
On the government’s bid to downsize the public sector, Charles expressed doubt that the BN government would sacrifice its vote bank in the civil service.
“Ultimately, we are looking at the reduction of the wage bill of the public sector and following the World Bank’s strategy of implementing a new management system by treating the government administration as if it is a company.
“But this will never happen because most of the 1.2 million civil servants are Umno-BN supporters. They will not give up this vote bank,” he said.
The trained economist also criticised Najib’s proposal to require government-linked companies (GLCs), which have long been criticised for crowding out the private sector, to divest assets and see more of their equity sold off.
“It is clear the government is moving fast to deregulate the market, and reduce or divest the size of GLCs but in countries like India and China, some of the GLCs are world leaders. They are not private companies.
“How is it that they are doing well and they are performing phenomenally overseas? Because they know what is competition. They have the brains and the human capital,” he said.
Charles predicted that if Putrajaya pushed to suddenly downsize its GLCs, it would not have the financial muscle to compete with foreign firms.
“GLCs, if well-managed, should be considered as national assets. Like in China, GLCs are used to help boost the local economy and enrich the community. GLCs have a specific role to play but if you downsize it here and sell it off to foreigners for example, at the end of the day, the government will lose out,” he said.
Nga described the NEM 2 as ‘old wine in a new bottle’. — File pic
DAP’s Taiping MP Nga Kor Ming described the NEM 2 as “old wine in a new bottle” and claimed that there was no sincerity on the government’s party to implement reforms. “The essence of the NEM was supposed to create a level playing field and encourage fair and open market. But what was revealed yesterday, among the 66 proposals in the final part of the NEM, just goes back to the spirit of the NEP, which is the emphasis on the 30 per cent Bumiputera equity target,” he said.
He added that Najib had clearly “succumbed” to the “pleasures” of Perkasa.
“It just proves that Perkasa has the influence to dictate government policy,” he said.
PKR leaders Batu MP Chua Tian Chang and Gombak MP Azmin Ali agreed with their DAP and PAS colleagues on the issue, claiming that the premier was testing the public’s patience.
“NEM is only rhetorical and about slogans. It is a great disappointment and shows Najib does not dare to take the bull by its horns.
“I also think that NEM is a total failure after months of briefing but nothing concrete has come out of it,” said Chua.
“The people are getting frustrated with the slogans and rhetoric. Najib has talked about transformation but the implementation has not benefited the people. The people, especially the business community, feel that nothing has been done for the last two years,” said Azmin.
Najib unveiled his highly-anticipated NEM 2 report yesterday but analysts believe that it would fail to impress today’s more discerning electorate who are determined to see the premier’s commitment to promoting inclusivity, reform affirmative action to be more efficient and market-friendly and to steer clear away from the culture of patronage and rent-seeking that has been plaguing the economy for decades.
Chua said the people are getting frustrated with slogans and rhetoric. — File pic
In his promises, Najib has pledged to reform an economy whose investment rates have not recovered from the 1998 Asian financial crisis and where foreign direct investment has fallen off a cliff from the heady days of the early 1990s. Missing from the report yesterday, however, were concrete measures to reform the NEP which affords the country’s majority ethnic Malays preferential quotas including for businesses, although it did pledge to target aid at the poorest 40 per cent of Malaysians, regardless of race.
Investors have also complained that abuse of the four-decade-old NEP policy had spawned a patronage-ridden economy and eroded Malaysia’s competitiveness compared to faster reforming neighbours including Indonesia.
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