Aru You Kidding Me? Minister!

Hantu Laut

Are you kidding me?

Big drop in FDI, cause we are getting quality not quantity investments says Minister of International Trade and Industry Mustapha Mohammed here.

“We are beginning to attract quality investments,” he said.

“It doesn’t mean that if it’s RM1 billion investment you generate lots of benefit for the country.

Sorry! Minister! Couldn't agree with you, not if you care about the macroeconomic of this country.We need both, but quantity more.

“It could be only RM10 million but, in terms of job opportunities, there are more job opportunities that pay higher wages.” he said.

Are we going for more labour intensive industries? How could labour intensive be paying higher wages?

Wow! I wonder which book of economic tells him small investments can provide bigger employment, pay higher wages and generate lots of benefit for the country.If that is the case why don't we just stick to growing more oil palm and set up more garment factories.

He gave the example of a “quality” local company worth RM200 million employing 1,500 graduates with a starting pay of RM4,000 per month.

That translates into a staggering RM6,000,000 monthly salaries just for the graduate employees alone.Surely, there must be other category of employees like clerks,office boys,drivers,coffee lady and so on.He did not mention what the company's business is.If it is a manufacturing concern than there must be factory workers on the floor.They need to be paid too, unless those graduates are the factory workers.

The graduates total payroll in a year would come to RM72 million excluding other benefits and salaries of other employees.What about other recurring expenses?

Need I go any further to tell you why our FDI and economy are in trouble.

When you have minister like this going round the world telling foreign investors we want quality not quantity investments and himself can't even do simple arithmetic let alone understand the intricacies of economic terms, what would you expect to get in return? A runaway success to woo foreign investors or a botched mission because our minister sounds unconvincing.?

Maybe, Najib should recall Rafidah Aziz. The lady would have done a far better job than our 'quality man.'

The example he gave is subjective.At the end of the day what is most important is the value added product, the bottom line.Size of investment does play a major part to the kind of quality and quantity of the products or services.

There again, we are talking about the drop in total FDI value which means there is lack of confidence by foreign investors putting their money here.It's simple economic.The more money you put in the greater would be the economic output, unless the minister has found a new economic theory that says otherwise.

In 2009 our FDI plunged 81 per cent.Not only new FDI avoided us like a leper, existing foreign investments in the country are not expanding their businesses.

If thing can go wrong it will go wrong, most unfortunate, when it should not be so, even domestic investments are moving at snail pace.

MITI must not count the eggs in its basket but ask whether the eggs can hatch to produce more chicks.Not all approved investments get to the ground.They look good on papers but failed to turn into economic generators.

The measure of FDI is confidence.It is confidence in the political stability and fiscal policies of the nation that draws foreign investors to any country.These two top foreign investor's wish list before other considerations like the availability of suitable labour force, infrastructures and other logistics are taken into account.

Obviously, Malaysia is suffering from lack of confidence in its political stability and unflattering fiscal policies.

We have three serious headaches, political instability, a siege fiscal policy and brain drain.

Prime Minister Najib was not able to implement his New Economic Model (NEM) due to strong opposition from the rent seekers in UMNO and Perkasa under the pretext of..... Malays still need help.

The government have had the NEP close to 40 years, one should ask how come there are still many poor Malays.Isn't that telling how much the NEP had been abused.If the Malays can't progress in the past 40 years what makes the clouts think they can in the next 40 years if the mentality do not change.

As Malays I think we should be self-critical and self examine ourselves where we have gone wrong instead of putting the blame on other races for our misfortunes.Likewise, the non-Malays should not question what's enshrined in the constitution, there is always room for fine tuning the fine print by constitutional means.Spurting racist remarks are not going to help but would only worsen the problem.

We certainly don't want to be called 'land of the blind'.We are losing our best brains to other parts of the world because they can't see what best for them in this country.

We produced graduates by the thousands but the private sector shied away from employing them.Why? We, probably know the answer to that.Many end up joining the civil service, that has ballooned the civil service to over a million employees, probably, making it the biggest in the world and a huge burden on the budget.

The economic indicators looked grim and would continue to slide if the government do nothing to arrest the negative perceptions and start innovating a strong investment climate.

Our foreign exchange reserves felled by 25 per cent in 2009 which means we incurred huge forex losses and exodus of money in 2009.The human and capital flight will have long term effect on the nation's progress.

When the best of money and the best of brain abandoned the country than there must be something seriously wrong.You will not see the effect immediately but a gradual decline as more and more leave for greener pastures and the safe havens.In the first eight months of 2009 over 200,000 Malaysians migrated.

This is an English proverb that says "you might as well be hung for a sheep as for a lamb"

Najib's NEM can only succeed if he subscribes to the meaning of this proverb.It means since you have gone some of the way you might as well go all the way, the punishment is the same.

As I have said many times before, Najib needs a major cabinet reshuffle.Too many dead woods and non-performers in his administration.

Unfortunately, adding insult to injury, many of his ministers are not talking sense.

OF CHILLIPADI AND BUAH KERAS

Hantu Laut

Pak Lah says don't compare Singapore with Malaysia.Read it here.

He says you can't compare "first-class grapes(Singapore) and first-class apples(Malaysia).

In the first place, metaphorically speaking, there are no 1st class grapes and 1st class apples in both English and the Malay language.There are only sour grapes and bad apples in English.

In the " The Fox and the Grapes" fable by Aesop, the fox made many attempts to find a way to reach the grapes hanging high on a vine but failed to reach it, retreated and said "The grapes are sour anyway"

The moral of the story is, it is easy to despise something you can get.

Who should we compare ourselves with in this region, Burma, Philippines or maybe Timor Leste ? Would that be a fair comparison ? What about Zimbabwe in Africa that has a whopping inflation rate of farcical 66,000 percent, where everyone is a millionaire but poor and a loaf of bread costs over 100,000 Zimbabwean dollars.

Isn't it natural that we compare with the best or the better ones rather than with something inferior to us.Wouldn't it be natural that we chose Singapore as a model due to its thumping success and close proximity to us.

Pardon me, Mr Prime Minister, I don't think Singapore is a first-class grapes, I think it is a 'chilipadi' and a 'buah keras'. Malaysia could have been a hotter chillipadi and a tougher buah keras if there where less corruption, nepotisn and cronyism. We have bigger land area, bigger population and much more natural resources than that tiny dot south of us. They have nothing but brains that have made them the envy of many nations and one of the highest per capita income in the world. Singapore is the touchstone for other countries especially Malaysia.

Three weeks ago you said Malaysia was the 6th most competative country in the world, now you say we are the 8th in the world. Which is the correct one?

I tell you what, both of your figures were wrong, cooked up by your good-for-nothing MOF boys.Why didn't they give you the source of their information so your humble citizens can check the validity of your claim.

The correct information, if you want to know and for all Malaysians to know are shown below.These are ratings done by IMD, a leading business school in Switzerland and WEF (World Economic Forum)

Overall Scoreboard 2007 (PDF, 151)

WEF World Competative Ranking

From the chart you would notice Malaysia's ranking for 2007 was 23rd by IMD and 21st by WEF, not 6th or 8th as given to you by your MOF boys who probably did a stitch-up on you.

I do agree with you that the Malaysians economy has been doing fairly well the past few years but at the same time the costs of living has also jumped up making life difficult for the average Malaysians. It is the middle and lower income group who are taking the brunt of the higher prices.

Last but not least, the disinformation must stop.

MUSLIM NATIONS:ARE THEY READY TO TAKE ON THE WEST?

HANTU LAUT

At the 3rd World Islamic Forum, Prime Minister Abdullah Badawi and Indonesian President Susilo Bambang suggested Muslim nations to pool their wealth and resources as bargaining chips in exchange for knowledge, technology and innovation with the rest of the world.

Are Muslim nations ready? Do they have the resources to take on the West and the rest of the world?

Let us look at some economic figures.

In 2005 the combined GDP of G8 countries (formerly known as G7) was a whopping USD44 trillion while the combined GDP of OIC (Organisation of Islamic Countries) was a pathetic USD5.5 trillion, which was slightly bigger than that of Japan. The G8 produced two thirds of the world economic output.

The Muslim nations through OPEC controlled almost 40% of the world's oil production.With the exception of Angola and Venezuela all other members are from Islamic countries. With such immense resources at their disposal one would think they could bring down the West to its knees.Unfortunately, that isn't the case, OPEC ability to control the flow and price of oil has since the 1973 oil embargo lamed due to discovery of oil in other parts of the world.

The Arab nations used oil as a weapon to vent their anger at the West after being humiliated when they lost the Ramadan War against Israel, also known as the 1973 Arab-Israel War. The embargo triggered high inflation throughout the world.The western nations realizing the formidable power of oil embarked on massive exploration of oil in other parts of the world and with new found technology  they can explore and drill for oil in deep waters of the oceans.

Oil is no more an option that Muslim nations can use to smack the Western nations.

America, the ever thirsty monster consumes almost 21 million barrels of oil per day. Saudi, the biggest single producer produces about 8.5 mil bbl/day.The current total OPEC production is around 30mil bbl/day and the US alone can consume 2/3 of OPEC daily production.

Hypothetically, if the US stopped buying oil for a few days the world oil price would crash to a disastrous level. If that's not enough, almost two thirds of world trade are denominated in US dollars. Almost all oil trades with OPEC are conducted in Petrodollar. Can the Muslim nations take on such behemoth? Do they have the clout to dictate terms?

Muslim world leaders should wake up to reality and try find workable solutions how to better deal with Western powers instead of making smart sounding speeches at forums and conferences and more often than not these Muslim leaders go back home can't remember what they have said and did nothing at all other than smoothening their candied lip.

Not a single Muslim nation is represented in G8. Only one Muslim nation Turkey is in OECD and three in APEC, Malaysia, Indonesia and Brunei and they are voices in the wilderness.The American are in all trade blocs including their own regional bloc NAFTA.

The OIC whose primary goals are to consolidate cooperation in social, cultural, scientific, economic and other fields of activity is not a trade bloc. It is more like a social club not cohesive enough to be a force to be reckoned with. Not only they lack economic might they also lack political clout. The US invasion of Iraq was an example of the entrenched weaknesses in OIC. Saudi Arabia and the Gulf states supported the American in the invasion of Iraq and destruction of Sadam Hussein. They see Sadam a threat to the region.

The Muslims fighting the war in Iraq against foreign invaders are called terrorists and not freedom fighters as the case would have been if America was on their side. The Contras in Nicaragua were rebels and terrorists in reality but with American supports they were called freedom fighters.

The Mughal in India, Safavids in Persia and Ottoman in Asia Minor were once Islamic powerhouses. Islam saw the final decline of its power and influence at the end of the 1st World War with the collapse of the Ottoman Empire. The Islamic world has not recovered ever since and is free-falling into the abyss of backwardness.

The devolution do not come as a surprise as many Muslims think and spend more time in preparing themselves for the afterlife than devoting themselves to constructive and progressive endeavours. For the past few centuries the Islamic world insidiously declined to it present debilitated state bereft of any innovation, invention and new technology.

Innovation and technology do not come cheap and nobody is going to hand them over to you for free. Almost all innovations and new discoveries came from the west.

During the Middle Ages, Europe was a far cry from being civilised and the European Renaissance would not have come about without the help of Islamic civilisation then. The European learned science, mathematics, astronomy and philosophy from Muslim scholars.The Europeans have since then managed a sustained growth and advancement of their sciences and technologies. With new found technology they have colonised many nations including many Muslim nations. They have put men on the moon and sent them to the deepest depth of the ocean. The guns and bombs Muslims used to kill each other were made by them. The nuclear energy and weapon that some Muslim nation hungers for are their invention and have now becoming their monopoly.

The West consider Muslim nations dangerous, irresponsible and should not be trusted to possess nuclear weapon.

While Westerns innovations and technologies advanced by leaps and bounds  Islamic nations have stagnated and fully dependent on the West for almost every essentials. Necessity the mother of invention is not in the Islamic lexicon.

Why are Muslims left so far behind?

Majority of Muslims are fearful of their religion, they put too much emphasis and effort on the afterlife than the fundamentality of their worldly existence. For many Muslims spirituality has become a fear factor and many Muslim nations used Islam to subjugate their citizens.

Many Muslim nations could and would not separate religion from politics. A case in point is the recent judgement passed in Malaysia by the country highest court on a case of apostasy, the Lina Joy case. She converted from Islam to Christianity and wanted Islam to be removed from her identity card but was rejected by the government. She has now exhausted all legal avenues, she either leaves the country or be arrested for apostasy. Can she be forced to stay in a religion that she has no more faith in?

About 200 Muslim protesters were outside the court waiting for the verdict. Fear of a backlash from the Islamists had probably influenced the decision. One judge out of the three a Christian, dissented.

Corruption is another stumbling block to progress. Many Muslim nations have corrupt leaders who put self interest ahead of the nation's interest. Some run the country like their own private fiefdom with complete disregard of their fiduciary duties. Indonesia, Pakistan, Bangladesh and most Arab countries are examples of systematic corruption. Malaysia, amongst the most progressive and developed of the lot was slightly lower on the corruption index but is catching up.

Malaysia introduced the NEP after the May 13 racial riot in 1969 to help the Malays uplift their standards of living and have equitable share of the country's economic pie and to be at par with the non-Malays particularly the Chinese, who held the greatest share of the economy.

During the last two terms of his rule, Mahathir Muhammad the then Prime Minister of Malaysia discreetly twiddled the NEP to appease the non Malays. His new social and economic policies heighten the business confidence among the non-Malays community and brought tremendous growth and development to a country that was once a tropical backwater. The GDP profile changed from agro-based to industrial and service orientated industries. The industrial and service sector now contribute 91% of GDP. Similarly, Mahathir is also responsible for huge losses incurred by some of his pet projects.

However, the past two decades also saw the NEP losing its noble and primary objective and used by political leaders mainly as gravy train. Big business deals and massive government contracts were given to relatives, party supporters, cronies and anyone who can pay. Cronyism and nepotism is much alive and kicking in Malaysia. Although Mahathir himself has not been implicated in any corruption cases, his failure to control it among his men had brought disrepute to himself and the party.

Another factor that is pulling down most Muslim nations is poor emphasis on education. Many have low literacy rate. Pakistan has about 49% literacy rate and in tribal areas the rate could go down as low as 20% and girls are normally not allowed to go to school. Such areas also confined education to madrassas where they only studied the Islamic religion.These madrassas are hotbeds for terrorism.

Pakistan may have nuclear capability but low level of literacy has dire consequences. Low literacy, wrong priorities and corruptions have made the country not only physically and economically poor but also mentally poor. Afghanistan fared even worse at 36%, Egypt, another big Muslim country has about 58% literacy. Iraq, currently a war zone has only 40% and Bangladesh 43 %.

Those gifted with oil are the lucky ones without which they could be in even worse dire positions.

Among all the ailments in Muslim countries, intransigent and corruption are the greatest killer to progress.