A Screwed Up Economy

Malaysia is a rich country naturally endowed with various natural resources like rubber, oil-palm, timber, tin, iron and petroleum. At the time of writing, its GDP stands at or around RM600 bn.

 

The country is a multi-cultural, racial, religious and linguistic country.  The population hovers around 28.5 million comprising the Malays, Chinese, Indians, Dayaks, Bajaus, Kadazans and the Orang Asli (Aborigines).

 

Malaya (before merger) obtained independence from Britain on 31 August 1957.   In1965, it merged with Singapore, Sabah and Sarawak to form Malaysia.  Singapore left the merger in 1968 due to irreconcilable difference between the political leader in Singapore and Peninsular Malaysia.

 

The people used to interact freely regardless of race and religion before the 70's.  Inter-racial relationship took a bad turn thereafter because of affirmative discriminatory socio-economic policies, known as the New Economic Policy.  It features sound objectives but due to warped and unfair implementation, race relations took a dive at all levels of the socio-economic sectors.

 

Having to deal with racial problems is bad enough but with bigoted religious polarisation in schools, civil service and judiciary, the schism became wider and wider.

 

The BN/UMNO Government have been ruling the country since independence in 1957 and merger in 1965.

 

Of late, economic development of the country is marred by corruption, money-laundering and fraudulent trade documentation as reported by the Global Financial Integrity(GPI).  In 2014, Malaysia ranked 52nd in the Corruption Perception Index as reported by the Transparency International Malaysia.  GOI reported that Malaysia laundered Rm171.11bn in 2012 and between the period 2003-2012, the total illicit efflux of funds from the country approximated to USD1.38 trillion. This works out on the average about RM100 bn is being laundered annually representing about 16.7% the country's GDP. Besides, reportedly, the Debt:GDP ratio has surpassed the 80% mark which is about 25% above the danger level.

 

The Sun of 16 Dec 2014 reported that 205 Federal Government Projects costing in total RM7.0 bn were behind schedule while 82 projects totalling RM2.2 bn are deemed or regarded as "ailing projects".

 

Of late, the country is saddled by the heavy losses sustained by the national Malaysian Airline which has to be bailed out by Kazanah which pumped in RM6.0 bn in an effort to revive the corporation. 

 

Again there was reported the 1MDB project which is steeped with heavy borrowings at high interest rate.  It is allegedly saddled with losses amounting to RM41.2 bn.

 

Faced with the fast decreasing price of crude to below US60/- per barrel,  the depreciation of the Ringgit, increase in prices of gasoline and diesel, hiked up assessment rate and the ominous enforcement of GST on 01 April 2015, the economy looks quite dismal given the fact that more than 80% of the work force earn below the poverty threshold of RM30,000/- per annum.

 

It has been estimated there are now about 9 million foreign workers in the country; of which 3 million are legal while the 6 million are illegal. These latter workers are displacing locals from employment in the plantation, manufacturing and construction sectors.

 

In my opinion and assessment, serious actions have to be taken by the ruling government.  Corruption has to be curtailed if not substantially mitigated by the Malaysian Anti-Corruption Commission.  The Central Bank will have to  tighten the control of illicit funds flowing out of the country.  Prudent spending on socio-economic projects will have to be strictly exercised and monitored.  In addition, attention must be given to minimise documentation frauds.  The Finance Ministry will have to ensure that public expenditure should not exceed revenue.  Tightening of belt is imperative if the country is to be turned around.

 

 

 

 

 

 

Corruption, Corruption, Corruption

I have been following public rallies, read articles written by foreigners and locals and leaders of both the Pakatan Rakyat and the Barisan Nasional.  There was no lack of local political news these days - much more than ever before.

One of the serious problems that came to light was election rigging or gerrymandering in past elections during the past five decades. Foreigners including illegal immigrats were granted blue identity cards and subsequently citizenship so that they could vote for the Barisan Nasional.

Past two years saw the surfacing of multi-farious complaints about phantom voters.  Thousands of such voters were found in the electoral roll.  They resided in either non-existent or existent places of abode.

Newspapers reports alleged foreign workers and illegal immigrants from Pakistan, Afghanistan, Indonesia and Philippines had been taken by buses to places  where they were indoctrinated and promised that temporary blue identity cards and country citizenship would be issued and granted them if they voted for the ruling Government.

Another deceptive idea was propounded by the Election Commission to allow eligible Malaysian students presently studying in UK, Europe, Canada, US and Australia and New Zealand to cast their votes through the post.

The ruling Government, particularly UMNO leaders, is taking advantage of the coming Chinese New Year and hold luncheon gathering to induce the Chinese voters to vote for UMNO candidates by offering hampers and ang-powers.

Within the last 12 months, money has been distributed to citizens earning below RM30,000/- per annum a sum of RM500/- each.  And, it is believed  that the BN is going to pay another RM500/- to them just before the election which is likely to be called sometime in March, 2013 after the Chinese New Year. The money of course is from the tax-payers purse.

The last 12 months saw the desperation of the BN Government and agencies moving billions of Ringgit overseas particularly in UK under the pretext of profitable investments.  Worst of all, the money had been taken from the workers' hard earned savings in EPF, SOCSO, GLCs, social and religious bodies,

Besides, billions of Ringgit were commited to various highly inflated infrastructural projects and procurement of military and defence equipments and arms.  Approval was given with such unpredecented ease as if money flows out of the ground.

All the above listed happenings are by no means exhaustive.  With the wanton expenditure, the deficit budget is likely to spiral until the bubble bursts.  It is indeed surprising to note that our highest goal-keeper is reticent and blind to such income reducing activities.  Looks as if it has lost its tongue.

Money laundering is rampant.  Thus far, banks involved have not been pulled up by the central bank and authority.  Charges have not thus far been preferred.

The atmosphere is smack of corruption air, it pervades to all nooks and corners of the country.  One wonders when it will be cleansed so that the nation will be able to grow and progress into an industrialised economy.

The time is for everyone to rise to the occasion and cast their votes wisely and choose the Government that promises inter-alia  anti-corruption, free education, removal of road tolls, and nationalisation of all the privatised utility corporations that have fallen into the hands of UMNO cronies, institution of a royal commission of inquiry into those past and present public leaders who have amassed huge and unexplained wealth through corrupt practices and abuse of their positions during their respective terms of service.

The rakyat wants a truly democratic country based on meritocracy and where the people rights as citizens are fairly protected regardless of their ethnic origin, religion and political affiliation.  Viva le Malaysia.

The Project that We Don't Need

So much has been said about the investment from Australia whose Government had rejected the application to set  up the refinery there for fear of harmful radiations that may harm over a period of time the populace there.

While much has been done and continued to be done on putting up periodical advertorials to educate and attempt to convert the public opinions through the mass media, one thing the investor has failed thus far is the failure to explain why his Government did not allow the waste to be buried in the soil of Australia?

I am quite surprised that the nuclear physicists and chemists who are now attached to local universities are keeping mummed about the Lynas Project and its deleterious impact of the radioactive waste on the people and the environment of Gebeng.

Obvioulsy that power to be have been led by the ignoramus or the mercenery scientists who would do anything so long as what they do or say do not hurt nor harm the people of their countries.

I am amazed at what happened in Penang Esplanade of late.  UMNO has again shown its evil propensity in trying to quell public protests by engaging reffians and thugs to derail their functions just like what it in disrupting the proceedings of a law conferene in Kuala Lumpur some years back.
This dirty tactic stinks like a skunk and does not reflect well on the Government.

I am a chemist by training and I know about rare earth, its composition and associated properties.
My professors know about rare earth .  Why cannot the Government seek their advice instead of paying heftily foreign consultants to come for a holiday here and say good things about the "goodness" of the project?

The people of Malaysia are no longer goons of the past.  Weare an independent sovereign capable of deciding what is good for the country except the 'disruptionissts' engaged by UMNO to suppress public demonstrations and protests.  These blokes are no different from their dictatorial and tyrannical leaders in the middle east countries.  I hope they do not turn the local situation into a Malaysian Spring.

Wedo not have to look too far to determine and judge the detrimental radioactions of the rare earth waste.  The Tioxide Project in the outskirt of Ipoh would have taught some of our stubborn and ignorant politicians a lesson or two.  But they just refuse to take a look at the realities of the sufferings of the people and the environment degradation in the areas surrounding the radioactive waste burial ground.

Do Malaysia need such a project to survive?  Absolutely not.  In my opinion, my advice to the meat heads is to listen to voice of the people.  This will cause the UMNO/BN alliance to lose more seats in the coming General Election.  Just watch my word.

Until now after 50 years, UMNO and their enuch allies have been treating the rakyat as stupid, uneducated and docile lot.  They have fooled us most of the time but certaily all the time.  The people power will determine the destiny of the evil ones.

Mai Bien Rai Attitude of UMNO Leaders

The NFC saga has gone too far. 

The public expects the acuthority to initiate serious action against those involved in the abuse of their authority and siphoning public fund to invest in projects other than the purpose for which it was approved.

It is quite amusing to see how politicians who were caught with their pants or in this case their skirts down how they behave and conduct themselves in trying to wrangle their way out of the predicament.

Firstly, when the Bangsar Mendung Condominium was uncovered, there came the denial of involvement therein despite the fact that her family is closely enmeshed in the project.  Later as time went by, more abuses were uncovered in Singapore where million of Ringgits had been used through hefty loans from the Malaysian Bank operating in Singapore secured on the collateral of the allocated public fund of RM400 million.

Had this cast been sincere as they claimed to be,  what they shuld have done was to make all these purchases in the name of the corporation and not on individual names.

To the eyes of the rakyat, the abuse of authority and mal-investment in activities other than what the project was approved for, this was certainly andundeniably an offence.

Should the authority take action against the Minister cocerned, who has brought great shame and ignominy to the political party of which she was member,  Anyone with any decency and dignity would have resigned from her post and face the music and not behaving like "a slittered chicken
trying to come alive by kicking the lid of the pot".

The act is shameful enough and yet we see some of the UMNO cronies trying to cover up the incident by trying to distort the issue.

What is most disgusting is seeing a senior UMNO leader telling through the media not to press for the resignation of the Minister concerned but instead trying to find ways to recover the siphoned resources.

In my view let not this tip of the proverbial iceberg distract us from some of the major perpetrations taking place within the Government Machinery where corruption and abuse of power are rampant and wide-spreading like an epidemic.

No wonder according to one foreign report, no less than USD350 bn had been illegally taken out of the country during the past decade. This massive flow of money out of the country has a great impact on the national economy which is gravely felt.

The currency has depreciated greatly, inflation has soared, prices of houses have shot up in recent years out of proportion.  Locally produced goods like cars have been priced ridiculously high when compared with that of neighbouring countries.  Project costs are topped up by as much as 20-30% higher to benefit the unproductive contractors.

It  is important that the EPF contributors demand its Management to account how their savings have been administered.  More than 60% of their savings have been borrowed by UMNO leaders and we want to see how much they have paid back or not.

The recent sub-prime housing loan to one FT Agency to help 20,000 who are ineligible,unqualified and rejected their loan applications by conventional banks  to own houses.  If any help is to be given at all, the current contributers should be given priority over this massive group of rejects.

The public just do not have the confidence that this government agency is capable of collection.  It will be another fiasco like the scholarship awarding agency.

IS BN FEARFUL OF LOSING THE 13TH GE?

The public is questioning why the BN Government is doing what it is doing in the face of the 13th General Election; which has been deferred to probably mid-year.

The country has been spending like nobody's business despite that she has been in deficit for the past 12 years.  Where does she get the billions of Ringgit to fund all the pay-outs.  Obviously not from her pocket.  It is from the workers' savings in EPF.  Thus far more than 60% of the savings had been borrowed by the BN Government and there is no sign nor evidence that she is paying back what is due to the 10 millions workers.  Most susrprisingly, the unions are keeping so silent on this.

The BN Government has just announced that she is taking out another RM1.5 Bn from EPF to loan to those who cannot obtain loans from the banks.  Does this not liken to the sub-prime scheme of the United States a few years ago, which contributed in no small measures to the financial disaster and collapse of many a bank there?

The wanton spending is just crazy if not unthinkable.  This does not inlcude for the hefty USD350 Bn or RM1,050 Bn cash that was illegally siphoned out of the country; despite this, Bank Negara lips had been sealed.  MACC have not been able to catch up with and prosecute all these corrupt BN leaders  who did great harm to the country's economy.

The recent NFC saga was just a tip of the iceberg.  God only knows how much more such proverbial NFCs had gone into the private pockets of the UMNO cronies.

The question that arises now is, "Is BN fearful of losing the 13th GE?" 

What BN is doing in recent time in my observation tends to suggest that she is fearful of losing its controlling power to the PR.  No wonder she is doing what it takes to ensure a victory in the coming general election through these various unpredecented give-aways in order to stay in power. What she is doing does not make any sense in nation building.  And, the imbeciles in UMNO realise it?  But, they cannot be bothered so long as they win in the coming election even at the expense of the country's economy.

Are the leaders afraid that the PR Government would initiate actions to intensify its effort to investigate into and prosecture those corrupt leaders who have amassed millions of illicit money through abuse of power and corruption.  Perhaps, this underlying fear motivates the UMNO leaders to do what they are doing.

The masses do not realise the gravity of our economy.  Whatever GDP growth over the past decades had been wiped out by the excessive billions that were illicitly taken out and parked in foreign banks.  No wonder our country is not progressing as fast as our neighbouring Singapore which is not endowed with natural resources like petroleum, rubber, palm oil and land.  During the last three decades, the SGD has appreciated more than 200% against the RM.  This phenomenon is baffling and mind-boggling to all economists.

My singular advice to the UMNO putras is this - you have to stop whatever evil, harmful and untoward practices right now to protect the interest of the country and her people.  You must come clean at the next election; otherwise, the rakyat  will vote against you, come what may.

The UMNO putras must realise that the country cannot afford a Malaysia Spring.  You may cheat all  people some of the time; some people all the time; but certainly not all the people all the time.

Race Relations Bill

Race Relations After 54 Years!

It certainly dawns upon the UMNO/BN ruling Government the serious need for race relations in Malaysia after 54 years of independence.

The PM recently announced and introduced for debate on the Race Relations 2011 Bill (RRA) which they intended to bull-dose through the Parliament without giving sufficient time for the Pakatan Rakyat to peruse.  No wonder it met with great resistance from the Opposition as well as the UMNO-backed PERKASA.

The RRA was aimed at replacing the Internal Security Act and the University & University Colleges Act.  It was learned that the RRA contains certain undesirable provisions that the civic minded public was feeling rather apprehensive that it would be abused by the ruling Government.  It just could trust the UMNO/BN Government.

As we all know the corrupt UMNO dominated Government lack intelligent and qualified leaders who were noted for aping foreign laws particularly those from UK) and try to introduce them in the country without much regard to the possible impact or consequences on the society at large.  The RRA of UK had been replaced by the Race Equality Act some years back.  If the Government was really serious about bringing about peace and harmony among the multi-racial, multi-religious and multi-lingual population, she must first talk about justice because without which peace and harmony would never be attained as history has shown.

People look forward to a just and honest Government which  is capable of looking after  the social economic development and progress of her citizens.  The resources of the country must be equitably shared with, distributed and meted out to the citizens without regard to race, creed or political affiliation.

A Government who is evil, corrupt and unjust can never expect the people to live peacefully.

The country has been run on negative budgets for more than 10 years during which period close to US300 bn, that is, RM1.05 tn, had been illegally smuggled out of the country.  This worked out to be around RM105+ bn per annum.  With is alarming outflow of funds,  no country can last for long without becoming bankrupt like some of the countries in Europe.

With the stark facts of gloom and doom before them, the Government is still unconcerned and unrepentant because the economy for 2010 has been robust and that the GDP is projected  to grow by 5% in 2012.  And,  the PM when recently cornered by the press replied that the said massive funds outflow would not have any impact on the country’s economy.  Who is our PM trying to deceive and hoodwink?

The message given by our PM was stunning and frightening.  In my view, it was highly irresponsible. Translated into simple language it just means that it is alright for UMNO lackeys to enrich themselves through unfettered  corruption and deception so long as the economy is robust.  What sort of moral message our PM is trying to inculcate among the citizens of the country!

The UMNO leaders must explain the situation to the nation.  It must not try to hide from the masses the perennial massive illegal capital outflow which far exceeds the increased GDP.  And, coupled with the negative budgets they unrelentingly incurred for the past 12 years, any economist of repute will opine that the outflow would have a deleterious impact on the national economy.

No wonder the people have to suffer for the stark indiscretion of the UMNO/BN leaderships; in that, they have to bear the high cost of inflation, low quality houses that have been built, abandoned projects, ridiculously and highly jacked up prices for any conceivable public projects or activity, higher manufacturing costs  and purchases etc.  Contracts are jacked up to provide for contractors to make profit without having to do the work.

Since EPF was introduced until now, the Government had borrowed more than 60% of workers’ savings to bail out insolvent or failed GLCs each year, investing in properties overseas and we wonder when the Government is going to start repaying this mammoth debt to the workers,

With the fossilized energy depleting, concerned citizens are wondering what our Government would do when the oil wells run dry within the next ten years?  How they are going to put back the money into EPF wherefrom they borrowed.

Only God knows if this situation is allowed to persist, whether the whole country will go under. The signs are showing and the people must be made to realise the fragile economy with which the nation is facing.

So my friends, vote wisely at the 13^th General Election without fear or favour.  Only your votes will and can bring about changes and betterment of the country.

  

The Massive Outflow of Money from Malaysia

The Global Financial Integrity (GFI), a US-based watch-dog agency, recently reported that Malaysia ranked the fourth highest among developing nations in terms of illegal outflow of cash from the country.

GFI reported that in 2009 alone, the illegal cash outflow came to RM150 bn .and that  between the period from 2000 to 2010,  close to US338 bn ( RM1.08 trillion) fled from the country.

It is most alarmingly disconcerting to note that when our PM Najib was asked whether such massive illegal outflow of fund from the country would not impact the local economy, he replied that it would not as the Malaysian economy was still enjoying a robust growth rate of 5%!  As if the answer was not mischievous and stupid enough, he added the country’s domestic demand was strong.  Any economist would find such rationale highly illogical, frivolous  and baseless.

The average illegal cash outflow worked out to be RM108 billion per year during the period 2000 to 2010 and this would have wiped out or negated whatever GDP increase about which the  BN/UMNO PM so ignominiously boasted.  He could hoodwink most people in the backyard and remote areas of the country but definitely not the urban middle class.

The GDP averaged over the past three years from 2009 to 2011 worked out to be about RM552.3 bn and basing upon our PM’s remark that our economic would grow by 5% in the coming year we are talking about an increase of RM27.125 bn and basing say RM100 bn was smurfed out of the country, whatever GDP increase would have come to naught.

Had the illegal fund outflow been prevented from disappearing from the shores of Malaysia, our Government need not have to administer the country on a deficit budget for the past decade.

Let us consider the recent NFC case in point concerning the allotted public fund being misused for purposes other that those for which it was approved.  The ministry was allocated RM400 million for the development of cattle-breeding project but close to RM20 million had been siphoned out for ‘purchase’ of expensive and luxurious condominiums in Bangsar and Singapore.  The target of producing sufficient cows could not be met. This resulted in a ridiculous situation whereby the local beef cost just as much as the imported beef.  This invariably caused the consumers to bear the brunt of  economic inflation due to corrupt, avaricious and mal-management personnel who were entrusted with public fund.

Just imagine had the “vaporized” RM1.08 trillion been channeled for the proper socio-economic development within the country, the entire population would have by now a decent house to stay in with sufficient savings stashed up for the rainy day.

The local populace may not have to bear the brunt of the highly- inflated cost of fuel and energy, houses, transportation, consumer goods and services, cars etc.

Another  great surprise was the introduction of the Money Services Business Act 2011 (MSB) aimed at curbing illegal cash outflow and  strengthening safeguards against money-laundering and terrorist financing and illegal activities.

In my most considered opinion, I think that the passage of the MSB was another exercise in futility.; particularly, when there was in place  already the Anti-Money Laundering and Anti-Terrorist Financing Act, 2001.  The conception of the MSB was another way of saying or confessing  that the authorities, that is, the regulators,  concerned had failed miserably in stamping out money laundering in the country.

The Government of the day must realize the importance of its role towards the public at large.  She is entrusted by the public at the election  to protect their interest including their socio-economic and spiritual well-being through proper and responsible optimization of the country resources.  
Victory in a general election does not give the winning party the carte blanche to squander the country’s resources like what the UMNO/BN leaders do.

It is imperative that civil servants and public leaders shoulder  and discharge their responsibilities well so that the people get the optimal benefits they so deserve from the sweats of their hard-work.  The money that they contribute to the country’s coffer through the income and corporate taxes they pay, the compulsory savings both the employers and employees contribute towards EPF, SOCSO and zakat should not be wantonly  utilized or expended for non-profitable, unproductive and futile investments and business adventures.  Corrupt leaders must be severely dealt with and if found guilty of corruption  be dismissed summarily from employment.
  The ill-gotten wealth should be confiscated and the guilty incarcerated for at least ten years.

Money laundering is a disease and if not checked will cause economic distortions in the country.  If not curbed, it may attract criminals to come to the country to embark on various deceptive and dubious  schemes to defraud  the public further.

My suggestion for the Government is to take a serious view on those who are corrupt and/or those who are  involved in illegally taking money out of the country or accepting bribes from the public.
  Unless you do this, the public will not trust the power that be.

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