Wednesday, October 30, 2013

Najib Cut Fuel Subsidy Now,Better Late Than Never.

Hantu Laut

In spite of the oppositions pouring scorn on Prime Minister Najib's capability of running the country he did make significant transformation in some key areas crucial to the economic well-being of the country.

The World Bank Report below shows that Malaysia is among the economies that improved the most across three or more doing business areas

So, Najib did nor rest on his laurels as perceived and deplored by the opposition Pakatan Rakyat leaders.

For starter, the introduction of the GST is a welcome sign that Malaysia is moving forward.

The next big thing Najib should do to is trim the budget deficit by removing fuel subsidy completely. It is the most wasteful and unproductive subsidy that have eroded the nation's coffers. The subsidy have led to smuggling of our resources to neighbouring countries, where fuel costs are higher and sold at market price. 

Najib should not wait too long to remove the subsidy, he must do it  soonish, preferably before the end of 2014, on the premise that "time is a good healer" hence if the premise is true, then the conclusion must be true. Time heals the grieving heart, people tend to forget the bad times as time goes by.

The government spent almost RM24 billion a year on this wasteful and unproductive spending, which most Malaysians are unaware of and failed to appreciate. 

Just imagine how much developments beneficial to the people, or reduction of our fiscal deficit can come from this money, instead, of turning it into wasteful and toxic carbon monoxide.

He can do wonders with the saving.

Read the World Bank Report here.

Ease of Doing Business in

This page summarizes Doing Business 2014 data for Malaysia. The first table lists the overall "Ease of Doing Business" rank (out of 189 economies) and the rankings by each topic. It also lists the economy's distance to frontier (DTF)** measure. The rest of the tables summarize the key indicators for each topic and benchmark against regional and high-income economy (OECD) averages.


REGIONEast Asia & Pacific
INCOME CATEGORYUpper middle income
68down 2

81.8780.06down 1.81
Positive=Doing Business reform making it easier to do business. Negative=Doing Business reform making it more difficult to do business.
DB 2014 RANK16DB 2013 RANK***19CHANGE IN RANKup3
DB 2014 DTF** (% POINTS)94.31DB 2013 DTF** (% POINTS)93.41IMPROVEMENT IN DTF** (% POINTS)up0.90
Information on new business density and number of newly created firms with limited liability can be found at Entrepreneurship Database.
IndicatorMalaysiaEast Asia & PacificOECD
Procedures (number)
Time (days)
Cost (% of income per capita)
Paid-in Min. Capital (% of income per capita)
No.ProcedureTime to CompleteAssociated Costs
1Apply to the Companies Commission of Malaysia (CCM) on the prescribed form (13A) to ensure the availability of the proposed company name1 dayMYR 30 per name search application
2Company Secretary prepares the company incorporation documents3 daysMYR 1,000
3File necessary documents with the Companies Commission of Malaysia (CCM) one-stop shop and obtain company incorporation, tax registration, registration with the Employment Provident Fund (EPF), Social Security Organization and the Inland Revenue Board, a1-2 daysMYR 1,000 (registration fee)+ MYR 220 (stamp) + MYR 100 (post-incorporation package)
** The distance to frontier (DTF) measure shows the distance of each economy to the "frontier," which represents the highest performance observed on each of the topics including Getting Electricity across all economies included in Doing Business. An economy’s distance to frontier is indicated on a scale from 0 to 100, where 0 represents the lowest performance and 100 the frontier. Read more...
***Last year's rankings are adjusted: they are based on 10 topics and reflect data corrections.

Tuesday, October 29, 2013

Sugar And GST: Anwar: Scholar, Politician, or A Clown?

Hantu Laut

I don't quite understand this man.Sometimes, he makes sense, other time, blowing hot air.

Maybe, it's time Anwar Ibrahim cuts the cuckle and get real. His remonstrances against the GST has turned ridiculously tasteless and deplorable for an educated man like him.

How can Malaysia be wrong when over 160 developed, developing and under-developed countries have adopted the GST or VAT to their tax structure.

He sounds the typical crab mentality in a "king of the hill"match when he condemned the removal of sugar subsidy and alleged that the taking away of subsidy stands to benefit sugar manufacturers, particularly, Syed Mokhtar Al-Bukhary. 

The figures he quoted make no sense. The government claimed to have subsidised the price of sugar, but his imputation  make it seemed that it was the manufacturers who actually subsidised the commodity by lowering the price. He said now that the subsidy has been removed the manufacturers/distributors profits have skyrocketed. Story here.

For decades the distribution of sugar in the country was the monopoly of one Chinese towkay and there was not a squeak from Anwar's mouth. 

For more than half a century the sugar trade was controlled by Robert Kwok's companies and Anwar who was Finance Minister and Deputy Prime Minister then did not complain of such monopoly and did not call for its removal. The "Sugar King" had complete control over the distribution of the commodity before Felda took over his manufacturing complex. Anwar had the power to change things then, why didn't he?

It's OK for Chinese to be rich, but Malays must not become too rich even if they worked hard for their success and Syed Mokhtar is a businessman just like any other Chinese businessman whose success and reliability in making things happen have attracted those in power to give him huge projects where other Malay manufactured entrepreneurs are likely to fail. One should admire him, not resort to argumentum ad invidiam.

May I ask Anwar, if GST/VAT is such a regressive tax how come over 160 countries adopted the tax regime, even more so, highly developed countries ?

Malaysia’s Mahathir Attacks Another Successor

Former Premier accuses Najib’s allies of buying votes in October intraparty polls
Former Malaysian Premier Mahathir Mohamad today appears to have fired the first volley of a widely anticipated attack on Prime Minister Najib Tun Razak, saying the premier’s allies in recent United Malays National Organization intraparty polls preserved their positions in the UMNO hierarchy by buying votes.
"We are told that they've eliminated corruption during the recent UMNO election, I am not convinced,” Mahathir told a conference at the country’s administrative capital of Putra Jaya. Although he didn’t mention Najib by name, he said: "I think there was a lot of money involved, going into the millions, and loads of people who should not be getting votes were getting votes because of the money they spent."
It’s uncertain how much clout the 88-year-old former prime minister still has within the party. He ruled as prime minister for 22 years until handing the position on to Abdullah Ahmad Badawi as his anointed successor in 2003. However, the implications are that the party, Malaysia’s biggest, may face a period of instability as the factions slug it out.
The next showdown, if there is one, could occur when UMNO holds its annual general assembly on Dec. 2-7 although a source in the Mahathir wing of the party said: “It could be, but there isn’t going to be a big bang. Gradual fireworks.”
A recent poll named Mahathir the most popular figure in UMNO, with a 75 percent approval rating, although that didn’t translate into votes for his allies in the UMNO intraparty elections.
Najib emerged from the May 5 national elections appearing badly weakened after the Barisan Nasional lost the popular vote for the first time since 1969 although it preserved a diminished parliamentary majority thanks to gerrymandering. Mahathir and Daim Zainuddin, the former finance minister, blamed Najib for reaching out too much to the country’s Chinese and Indian minorities at the cost of votes from UMNO’s ethnic Malay base.
After the election, Mahathir damned Najib with faint praise in a speech in Tokyo, saying the prime minister would stay in office because there wasn’t anybody at the time to replace him. Bloggers aligned with Mahathir have been staging attacks on the prime minister since the May polls, with one describing him as a “bug on the windshield.”