Demonising subsidies is wrong. Subsidies is essential for justice...and the people of Malaysia

Government subsidies have ensured that we all get almost free education(including books), healthcare,  essential items like cooking gas, fuel, diesel, sugar, rice, cooking oil, other food items, basic amenities like electricity, water, sewage treatment, telecommunication, radio/television, roads and other public amenities, etc for very nominal affordable rates...and this is something that must continue to be for the good of all in Malaysia.

But sadly, Najib's premiership is trying even harder to move towards pure capitalism - where the consumer pays for everything at cost price. He seems to be trying to emulate the failed American capitalist model - that has seen the generation and increase of the 'new poor, called the Fourth World. The capitalist system has failed as a model for justice for all persons. 

Malaysia, like many other developing countries, have been 'forced' to open itself to 'free trade' and other aspects of pure capitalism - and Malaysia have surrendered a lot when it signed the World Trade Organisation(WTO) Agreements, and other Free Trade Agreements - amongst which also state that there can be no more special preferences to citizens (let alone particular ethnic groups in Malaysia) or local companies. No more taxes and import duties , or other measures, that used to give a competitive edge to Malaysian companies and products. 

Malaysia is currently is still protecting only its automotive industry - and I wonder how much Malaysia pays to do this. 

The new trade agreements, that Malaysia signed also prevents even the imposition of conditions like requiring the use of a certain percentage of local Malaysian products /content (or Malaysian manufactured products). Of course, our good UMNO-led BN government has not told us all this, let alone ask the people of Malaysia, before they signed all these agreements which will certainly be very prejudicial for Malaysia and its peoples.

I hope that the Pakatan Rakyat, other opposition parties and civil society groups will concentrate efforts in educating Malaysians as to what the UMNO-led BN had done - and its impact to Malaysia and Malaysian peoples, and what we can do to either reverse this or at least mitigate the future consequence of this. But first, these opposition politicians need to educate themselves about these matters - and then take on the obligation of educating us Malaysians. Sadly, our government controlled and/or owned media has not fulfilled its role of educating people, informing us about the pros and cons, etc. They have just kept it all 'secret' - maybe by reason of directives from those in power, and also because sadly many reporters are also not aware/educated about these issues. We have been 'frogs under a coconut shell' ('katak di bawah tempurung') for too long - and now we are going to face the consequences of this. 

The agreements that Malaysia has signed forces Malaysia to open its doors wide to foreign competitors - and many of the subsidies we have in Malaysia are seen as a form of 'protectionism' which is not allowed by these agreements.

The concern of all these agreements is not the welfare of all persons - but purely business. Fair  Free Trade  - no protectionism...that is the priority and concern.

Without telling us the truth and the reasons, why Malaysia has to do away with 'subsidies', the government has started an initiative of demonizing subsidies - how bad it is? how it waste government monies? how it is not really reaching the target group, etc..? how we need to get rid of it so that money saved can be used to build more schools, hospitals, etc...

There has been a lot of talk about subsidies as though it is  something bad - and waste of government money - the people's money. Tell us why you are saying so now, Najib Razak.

But subsidies are essential, and has always been so to ensure the survival of  all persons in Malaysia - especially those from the lower-incomed groups - including the middle class. The plan of removing subsidies - and using the money saved to channel financial assistance directly to the poor is being now thrown around. 

But alas, this really will not work given the rise of 'corruption' and 'discrimination' in Malaysia.

Even today, there are many complaints that the UMNO-led BN government discriminates against persons belonging to (or alleged to be supporters of) other Opposition parties/persons. Connections are 'important' in Malaysia when it comes to receiving benefits and opportunities, and that is why it is best to just maintain subsidies for all essential items that affect survival and normal day living of all Malaysians. Remember, subsidies are only for the basic needs.

With the opening of markets, and the entry of foreign companies - this will mean that the Malaysian government money may have to be given to these foreign companies as 'subsidies ' to maintain the low  prices that people in Malaysia pays.

Why pay the foreign companies? Because there is no choice for just paying local current service/material providers as this would be a violation of the 'free trade' equal competition requirement. Today, subsidies with regard to electricity is paid to Tenaga - but when another foreign utilities company comes in, then that company too will have to be paid 'subsidies'. Whose fault? The UMNO-led BN government - but we have to pay for its mistakes in the past today and tommorrow.

Roads - well, in Malaysia these used to be free. Then the government started 'privatizing' roads and today road users have to pay hefty tolls to use these roads. The government did promise that they will still be building government roads, and all existing government roads will be enhanced to double-lane roads - but anyone using government roads will see that many of these roads are in a state of disrepair, and there seem to be no upgrading and improvement of these roads. To travel from Temerloh to KL(less than 130 Km), the toll that you have to pay is RM6 + RM5 + RM3, and it is a lot. Alternative government roads - well, there really is none from Karak to KL, is there? Even if there is, there really is no signboards - or even upgrading done.

Hospitals - well, the requirement was a nominal RM1 - RM5 - but slowly, we see charges coming in. By the way, some government hospitals, like University Hospitals,  have been 'corporatised' - and this means you have to pay unless you are a civil servant (or retired civil servant).  Heart healthcare - well that is no more available to the poor and the private citizen unless you have a lot of money... IJN (National Heart Institute) - and no more heart healthcare units in government hospitals all around the country.

Television - Well, try using a normal aerial and see the kind of television reception that you get. To get good TV, we have to subscribe to satellite television, i.e. ASTRO. Minimum charges per month is RM37.95. Malaysian TV channels should be FREE - RTM1 & 2 at the very least. Subscribers should have this option, and should maybe just charged a one time charge for the satellite disk, decoder charges. In Thailand, you have this option but not in Malaysia. The minimum monthly charge is  RM37.95. And, of course the government is not improving the ordinary television aerial coverage and quality.  

I can go on....but enough for now.

NEM talks about higher pay - but this is for the now and the future. How about the current and past who earned so little (who have saved so little for the future)? How about the old folks? Currently, the government can increase pensions of former public servants - and provide everything free for this category...but what about those that were self-employed or privately employed? EPF - one time pay-out is certainly not going to sustain most workers beyond 5 years of their retirement, given the current cost of living. So, what happens then?

I really hope that the Opposition Parties, besides just trying to take over the government, would spend time on these issues - and tell us what they will try to do to resolve this problem that the UMNO-led BN has left us with.

I really would be more interested in this - rather than the Rosmah-Najib scandals, sodomy trials,  party-hoppers, etc... 

Removal of 30% Bumi quota - Why? Opening the door to foreign control of Malaysian businesses..?

What really happened?

Removal of the 30% Bumiputra quota... WHY?

A radical move by a new Prime Minister to bring about much needed reforms of a system that really benefited only the rich 'bumiputras' rather than fulfilling one of the 2 original objective of the NEP, i.e. the eradication of poverty

OR - was it an just an act that Malaysia was forced into doing to comply with its obligations as stated in the various World Trade Organization Agreements [WTO Agreements] and maybe even some of them Free Trade Agreements?

I believe it is the later - because when the UMNO led-BN signed those agreements, I am of the opinion, that they also did sign away the special privileges of the Malay, natives of Sarawak and Sabah that existed in Malaysia since independence. [Maybe, it is time that the Malaysian government come and explain the consequences of their signing the WTO Agreements, and its benefits - and their evaluation of benefit and cost to Malaysians today]. Who is the traitor to the Malays and the natives of Sabah and Sarawak? Is it not the UMNO-led BN?

In a sweeping move towards liberalising the economy, the government yesterday removed the 30 per cent Bumiputera quota on equity ownership in 27 service sub-sectors (see list at right). Prime Minister Datuk Seri Najib Razak will take the move a step further next week with a major announcement involving the financial sector.

The sub-sectors affected with immediate effect are health and social services, tourism services, transport, business and the computer industry and related services.

He also announced that the legal profession had also been liberalised to allow up to five top international law firms with expertise in international Islamic finance to practise here.

Najib, who is also finance minister, said the move would attract more investment and bring in more professionals and technology, besides strengthening competitiveness in the sectors.

"The services sector is an important component of the national economy, contributing 55 per cent to the gross domestic product last year. Of this, 47.6 per cent was contributed by non-government services."

He said the sector accounted for 57 per cent of total employment in the country.

The government, he added, would intensify the tapping of the full potential of the services sector as a new growth area in the economy to raise its contribution to 60 per cent of GDP as targeted in the Third Industrial Masterplan.

Najib said the government would be progressively undertaking liberalisation of other services sub-sectors on an ongoing basis.

"The liberalisation of the services sector is being pursued with the view of creating a conducive environment to attract investments, technology and create higher-value employment opportunities.

"The initiatives will not adversely affect the domestic services industry as the government will continue to support the industry in capacity-building and in the opening up of export markets.

"In fact, this move was decided based on response and acceptance of the sector," he said.

It was also part of Kuala Lumpur's commitment towards an Asean agreement in liberalising the sector.

Najib said a services sector capacity development fund of RM100 million had been established under the first economic stimulus package.

The fund is being managed by the Malaysian Industrial Development Authority to strengthen the industry in facing the more liberalised services environment.

Najib also announced the formation of a national committee for approval of investments in the services sector under the Malaysian Industrial Development Authority.

The committee will act as a focal point to receive and process investment applications in the services sector but will not touch on investments in financial services, air travel, utilities, economic development corridors, Multimedia Super Corridor, Bionexus status companies and distributive trade.

"With this, we expect a greater inflow of investments," he added.

Approved investments in the services sector totalled RM50.1 billion last year, exceeding the investment target of RM45.8 billion per annum, with the share of foreign investments at 11 per cent.

In terms of exports, the sector contributed RM102.1 billion while imports totalled RM99.8 billion last year.

Najib said the World Trade Organisation had placed Malaysia among the 30 leading global exporters of services.

"With the focus on services, our promotional efforts in manufactured goods will be complemented by greater intensity given to export of services.

"The Malaysia External Trade Development Corporation has been tasked with coordinating and spearheading all export promotion initiatives."

Najib added that the liberalisation of the legal profession was part of measures to develop Malaysia into an international Islamic financial hub.

Successful law firms will be determined based on credentials and their business plans in respect of offices to be set up in Malaysia.

"These firms will only be allowed to offer legal services in international Islamic finance," he added. - New Straits Times, 23/4/2009, Move to liberalise economy: Services sub-sectors to soar with bold revamp

Najib - please be honest - and tell us the real reason why this 'liberalization' took place? Tell us also about the other impacts of signing these WTO Agreements?

Removal of 30% Bumiputra Equity - in favour of Malaysian ownership or foreigners... Will there be any requirement of Malaysian equity ownership of these companies. I think NOT...and that will not be good for Malaysians, will it now?

Not at all - now anyone can own these companies. There is also no quota requirement that will ensure that ownership is still Malaysian. The door seem to be OPENED to everyone - and nothing is stopping 100% foreign owned foreign companies coming in and competing with local companies, is there now.

Najib's announcement opens the door for further foreign colonisation of Malaysian companies - it is not a move that will protect Malaysians....[As I mentioned earlier, the UMNO-led BN sold us out manly years ago when they signed the various WTO (and also FTA Agreements)].

This move will not affect the rich much (and in fact may benefit many of the rich) - but for the poor, it will certainly be BAD....

Was this policy/practice of ' 30 per cent Bumiputera quota on equity ownership in 27 service sub-sectors' permissible by the Malaysian Federal Constitution in the first place? I think not - because our Federal Constitution is very clear about the permissible areas of special preferences for Malays, native of Sabah and Sarawak...Art. 153 of the Federal Constitution also do not provide for any magical '30%", and does it really cover these that are being liberalized now... [See also earlier posting:- Constitution can be discussed...can be changed - it is not sacred or infallible]

There is provision for reservation of certain proportion of permiits and licences for Malays and natives - but there really is nothing about any '30% share' in the equity ownership of a company..., is there.

Is there a Rule, Regulation, Order ...Gazzette Notification of sorts that talk about this '30%' ...and what it applies to? Or is it an arbitrary figure that is thrown around from time to time? Openness...transparency...that is what we need. We need to know...we need to be educated - based on 'facts' and the truth.

153. Reservation of quotas in respect of services, permits, etc., for Malays and natives of any of the States of Sabah and Sarawak.

(1) It shall be the responsibility of the Yang di-Pertuan Agong to safeguard the special position of the Malays and natives of any of the States of Sabah and Sarawak and the legitimate interests of other communities in accordance with the provisions of this Article.

(2) Notwithstanding anything in this Constitution, but subject to the provisions of Article 40 and of this Article, the Yang di-Pertuan Agong shall exercise his functions under this Constitution and federal law in such manner as may be necessary to safeguard the special position of the Malays and natives of any of the States of Sabah and Sarawak of such proportion as he may deem reasonable of positions in the public service (other than the public service of a State) and of scholarships, exhibitions and other similar educational or training privileges or special facilities given or accorded by the Federal Government and, when any permit or licence for the operation of any trade or business is required by federal law, then, subject to the provisions of that law and this Article, of such permits and licences.

(3) The Yang di-Pertuan Agong may, in order to ensure in accordance with Clause (2) the reservation to Malays and natives of any of the States of Sabah and Sarawak of positions in the public service and of scholarships, exhibitions and other educational or training privileges or special facilities, give such general directions as may be required for that purpose to any Commission to which Part X applies or to any authority charged with responsibility for the grant of such scholarships, exhibitions or other educational or training privileges or special facilities; and the Commission or authority shall duly comply with the directions.

(4) In exercising his functions under this Constitution and federal law in accordance with Clauses (1) to (3) the Yang di-Pertuan Agong shall not deprive any person of any public office held by him or of the continuance of any scholarship, exhibition or other educational or training privileges or special facilities enjoyed by him.

(5) This Article does not derogate from the provisions of Article 136.

(6) Where by existing federal law a permit or licence is required for the operation of any trade or business the Yang di-Pertuan Agong may exercise his functions under that law in such manner, or give such general directions to any authority charged under that law with the grant of such permits or licences, as may be required to ensure the reservation of such proportion of such permits or licences for Malays and natives of any of the States of Sabah and Sarawak as the Yang di-Pertuan Agong may deem reasonable; and the authority shall duly comply with the directions.

(7) Nothing in this Article shall operate to deprive or authorise the deprivation of any person of any right, privilege, permit or licence accrued to or enjoyed or held by him or to authorise a refusal to renew to any person any such permit or licence or a refusal to grant to the heirs, successors or assigns of a person any permit or licence when the renewal or grant might reasonably be expected in the ordinary course of events.

(8) Notwithstanding anything in this Constitution, where by any federal law any permit or licence is required for the operation of any trade or business, that law may provide for the reservation of a proportion of such permits or licences for Malays and natives of any of the States of Sabah and Sarawak; but no such law shall for the purpose of ensuring such a reservation -

(a) deprive or authorise the deprivation of any person of any right, privilege, permit or licence accrued to or enjoyed or held by him; or

(b) authorise a refusal to renew to any person any such permit or licence or a refusal to grant to the heirs, successors or assigns of any person any permit or licence when the renewal or grant might in accordance with the other provisions of the law reasonably be expected in the ordinary course of events, or prevent any person from transferring together with his business any transferable licence to operate that business; or

(c) where no permit or licence was previously required for the operation of the trade or business, authorise a refusal to grant a permit or licence to any person for the operation of any trade or business which immediately before the coming into force of the law he had been bona fide carrying on, or authorise a refusal subsequently to renew to any such person any permit or licence, or a refusal to grant to the heirs, successors or assigns of any such person any such permit or licence when the renewal or grant might in accordance with the other provisions of that law reasonably be expected in the ordinary course of events.

(8A) Notwithstanding anything in this Constitution, where in any University, College and other educational institution providing education after Malaysian Certificate of Education or its equivalent, the number of places offered by the authority responsible for the management of the University, College or such educational institution to candidates for any course of study is less than the number of candidates qualified for such places, it shall be lawful for the Yang di-Pertuan Agong by virtue of this Article to give such directions to the authority as may be required to ensure the reservation of such proportion of such places for Malays and natives of any of the States of Sabah and Sarawak as the Yang di-Pertuan Agong may deem reasonable; and the authority shall duly comply with the directions.

(9) Nothing in this Article shall empower Parliament to restrict business or trade solely for the purpose of reservations for Malays and natives of any of the States of Sabah and Sarawak.

(9A) In this Article the expression "natives" in relation to the State of Sabah or Sarawak shall have the meaning assigned to it in Article 161A.

(10) The Constitution of the State of any Ruler may make provision corresponding (with the necessary modifications) to the provisions of this Article.