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The Fire Next Time
Battle for Kelantan: Umno is optimistic
Analysts pour cold water on shadow budget
Noose Tightens in French Defense Scandal
Alarm bells over unions’ bluster on RM1,500 base wage

Posted: 05 Oct 2011 10:03 AM PDT

By Andrew Marshall, TIME

Whom do you call if you want to speak to Southeast Asia? Apply Henry Kissinger's famous question about Europe to the 11 countries that arc from the Himalayas to the Pacific, and an answer is equally elusive. Their economies, cultures and politics differ so dramatically that generalizing about Southeast Asia is a risky business.

But let's do it anyway. Southeast Asians have at least two things in common. First, they all know what it's like to live under authoritarian regimes and rulers. The latter range from brutal autocrats (Burma's recently retired General Than Shwe) to self-styled strongmen (Cambodia's Hun Sen) to leaders who benefit from repressive laws that safeguard the predominance of a single party (Malaysia's Najib Razak).

Second, Southeast Asians are bone weary of authoritarianism, and increasingly unafraid to say so. There is a growing demand for accountability and good governance that the region's elites and demidespots ignore at their peril. To call it a Southeast Asian Spring is an exaggeration. But the movement is youthful and social-media-savvy, and could precipitate changes just as profound as those in the Middle East.(See pictures of battles for Burmese democracy.)

Prime Minister Najib, who casts himself as a moderate, seems to realize this. His party, the United Malays National Organization, leads the National Front coalition, whose decades-old grip on power has sparked protests for electoral reform. In July police violently dispersed what should have been a peaceful rally by some 50,000 members of Bersih 2.0, a group campaigning for free and fair elections. (Bersihmeans clean.) Protesters used Twitter and YouTube to organize the rally and, later, undermine claims that the police acted with restraint.

On Sept. 15, his reformist credentials in shreds, Najib promised to scrap the Internal Security Act (ISA), which allows police to detain suspects indefinitely, along with the much abused Emergency Ordinance. He also vowed to loosen media restrictions and review the laws on freedom of assembly. It's hard to know whether he will keep his promises. But emboldened Malaysians will hold him to them, either at the polls — an election must be held by 2013 — or on the streets.

Najib's announcement provoked a swift defense of the ISA from neighboring Singapore, which also inherited the law from its British colonial days. The ISA is used "sparingly" to arrest terrorism suspects, and nobody has ever been detained only for their political beliefs, said the Singaporean government. That such a defense was felt necessary is telling. In a May election, opposition candidates — who want the ISA scrapped — made historic gains against the People's Action Party, which has ruled Singapore for half a century. The government retains "broad powers to limit citizens' rights and handicap political opposition," said the U.S. State Department in April.(See pictures of Malaysia.)

Indonesians haven't marched in huge numbers since toppling the dictator Suharto in 1998. But popular yearning for good governance could easily fill the streets again. President Susilo Bambang Yudhoyono's approval rating is plummeting, thanks to corruption scandals implicating senior officials, and an upcoming Cabinet reshuffle will do little to halt it. Indonesia's strong economy won't stave off protests either. Stability requires functioning institutions, free media and an unfettered civil society, as well as economic growth.

Thailand is a case in point. It is now an "upper-middle income economy," with a gross national income per capita of $4,210, according to the World Bank. But it has been free-falling on other indexes, particularly those measuring corruption and media freedom, since the military overthrew yet another government in 2006. The street protests that followed were divisive and sometimes violent. But they encouraged millions of Thais to demand more say in decisions that affect their lives. Thai politicians, with their old-school reliance on patronage and payola, seem destined to fail them.

That goes double for the young. About a fifth of Southeast Asians are ages 15 to 24. Their youthful energy has so far been channeled into dynamic economies — but that doesn't mean the kids are all right, if statistics on unwanted pregnancies and drug use among Thai teenagers are anything to go by. And governments, institutions and firms across Southeast Asia still retain hierarchical structures that stifle youth and innovation.

This is especially true in Burma, where young people are key to reform: they have dominated every street protest since the military seized power in 1962. A nominally civilian government took office in March and has embarked upon reforms, suggesting that even Burma's hard-liners sense history is against them. In a recent interview, democracy icon Aung San Suu Kyi ruled out an Arab-style revolt, and not just because violence appalls her. With Southeast Asians finding their voices, inspiration could lie much closer to home.

Battle for Kelantan: Umno is optimistic

Posted: 04 Oct 2011 07:22 PM PDT

PAS has ruled the state since 1990 and another general election is around the corner. This time around, Umno is confident of dealing a blow, if not capturing the entire state.

The state government had alleged factions, one led by state PAS deputy commissioner III Nik Amar Nik Abdullah and deputy mentri besar Ahmad Yakcop as well as state PAS strongman Takiyuddin Hassan. The other, or rather operating in isolation, was PAS vice-president and state economic czar Husam Musa, whom many in Umno believe, is the political god-son of Nik Aziz.

Hawkeye, Free Malaysia Today

Kelantan Umno is optimistic of performing well in the impending general election because they claim that the PAS-led state government has lost its way due to stale policies and a lack of innovation to spur economic growth.

This gave rise to the possibility of Umno denying a two-thirds majority in the 45-member state legislative assembly while some of its leaders even forecasted a possible takeover of Kelantan.

Many Kelantan Umno leaders believe that Menteri Besar Nik Abdul Aziz Nik Mat might have overstayed his welcome.

Nik Aziz, 81, besides Sarawak Chief Minister Taib Mahmud, were the only holdover leaders from the 1990 general election.

Most of the PAS spiritual adviser's nemises such as former premier Dr Mahathir Mohamad have retired, although the latter tends to offer occasional input and advise to the present federal government.

Nepotism and factionalism

State Umno treasurer Hanafi Mamat confirmed this, saying there was some confidence that Umno could score a breakthrough but expressed caution as Barisan Nasional was often the underdog here.

He said this was because PAS had made a foothold on this east coast state since reclaiming it back in 1990.

If political observers study the nature of Kelantan politics, PAS had ruled the state longer than BN since 1957, he added.

But of late, Hanafi claimed, the momentum seemed to be shifting away from PAS, largely due to Nik Aziz overstaying.

It began to unravel after the hiring and eventual termination of his son-in-law Abdul Arifffahmi Abdul Rahman as CEO to a state subsidiary- the Kelantan Mentri Besar Incorporated Sdn Bhd.

The issue dragged on for weeks in 2009 and resulted in the PAS national leadership having to intervene after a blogger began to slowly expose alleged improper dealings of the state subsidiary.

For once, Hanafi said, the people here saw a level of nepotism in the state administration and then, Nik Aziz's son, Nik Abduh won the PAS Youth deputy chairman's post earlier this year.

"Spiritual empowerment is part and parcel of Kelantan voters. They want their leaders to be seen as holy and righteous. Once, they see another side, a tendancy for abuse or an unIslamic behaviour, they may stop supporting the incumbents. This is where PAS is worried," he said.

Hanafi claimed that the myth of piousness surrounding Nik Aziz had began to fracture and the spillover was evident in the state administration.

Factionialism impeded the state government from focusing on development and the state was more than ever, reliant on the repartition of income from outside of Kelantan to generate growth.

Basic utilities such as water and electric supplies were also lacking in large swatches of the hinterland here while the main economic indicators were mostly in the low-end jobs of logging, land transactions, agriculture and cross-border trade.

Another encouraging sign for Umno, was the two by-elections held since 2008.

In Manek Urai, PAS only won with a majority of less than 70 votes while in Galas last year, Umno regained the seat it lost in 2008, largely due to the influence of the long-serving Gua Musang MP Tengku Razaleigh Hamzah, Hanafi said.

Currently, Umno or BN held six out of the 45 seats in the legislative assembly.

Hanafi said another indication of support was the gravitation of the large state civil service corps towards Umno.

"I think the public sector is also getting fed up with the lack of movement on state policies. Furthermore, Nik Aziz is frail and at times, has to be hospitalised. This hampers the functions of the state machinery," he said.

After the 2008 general election, Kelantan PAS was expected to play a major role in the national political scene since Pakatan Rakyat was formed and it controlled Kedah, Penang, Perak and Selangor besides Kelantan.

Posted: 04 Oct 2011 07:14 PM PDT

The budget is too focused on pleasing the civil servants instead of finding ways to expand the revenue base, they say.

Centre for Strategic Development chief executive officer Fui K Soong said Pakatan's budget should find ways of increasing the nation's revenue base instead of being too focused on expenditure. She said one way was for Pakatan to formulate policies that would promote growth in the private sector to increase the tax base that would eventually generate more income for the country.

G. Vinod, Free Malaysia Today

While lauding Pakatan Rakyat for announcing its shadow budget for 2012, several analysts said the budget failed to address many fundamental issues plaguing the nation's economy.

Yesterday, Opposition Leader Anwar Ibrahim announced its RM220 billion shadow budget, themed "Prosperity for All", which he said was aimed at overhauling the country's "flawed" macro and micro economic management.

Anwar also said that, among others, the Pakatan budget would look into assisting the poor by allocating RM22 billion in subsidies for basic goods and ensuring long-term fiscal survival which would focus on trimming the nation's deficit.

Calling it a populist budget, analyst Khoo Kay Peng said the budget was too focused on pleasing the civil servants at the expense of the nation's coffers.

While other countries such as Greece and Japan were trimming down their civil service, Khoo said Malaysia's political parties were more focused on increasing the civil servants' perks to fish for votes.

"I have no issue with increasing their salaries but we must remember that our civil service is over-bloated," said Khoo.

He added that to solve the problem, a massive structural reform was needed to reduce the dependence on foreign labour.

'Strong political will needed'

Khoo said the problem arose when the private sector, in a bid to reduce costs, hired foreigners to fill its vacancies at the expense of locals.

As a result, he said, the local skilled and unskilled workforce was deprived of jobs.

"And fearing a political backlash, the government absorbs these unemployed locals into the civil service," he said.

Khoo added that to solve the problem, both the government and private sector must come together to create jobs and ensure only locals are hired.

"But a strong political will is needed," he said.

Centre for Strategic Development chief executive officer Fui K Soong said Pakatan's budget should find ways of increasing the nation's revenue base instead of being too focused on expenditure.

She said one way was for Pakatan to formulate policies that would promote growth in the private sector to increase the tax base that would eventually generate more income for the country.

'Plucked out of thin air'

Praising Pakatan for introducing a minimum wage for civil servants, Fui reminded the opposition pact that the policy must be linked to an increase in productivity.

"We must remember that a minimum wage policy is a tool to prevent abuses by employers and to look after the workers' welfare; it is not a way to eradicate poverty," she said.

Soong also said that the shadow budget, while explaining expenditure, did not elaborate much on how much income is to be collected to foot the bill and the sources of revenue.

"It didn't address on how to expand our revenue base as well," she said.

Posted: 03 Oct 2011 09:13 PM PDT

Asian dimension as French state-owned arms company faces murder, bribery allegations

Breham said Razak Baginda's company Perimekar had received the commission for "supporting the contract," which he said was a euphemism for unexplained costs, and also for "housing the crew" of the submarines in France. Perimekar was wholly owned by another company, KS Ombak Laut Sdn Bhd, which in turn was also controlled by Razak Baginda. His wife Mazalinda, a lawyer and former magistrate, was the principal shareholder, according to the French lawyers.

Written by John Berthelsen, Asia Sentinel

After years of inaction and coverup, details are emerging in France of the sale of armaments by the French state-owned defense contractor DCNS to countries across the world including Pakistan, Malaysia, Chile, India, Taiwan and Saudi Arabia, with bribes and kickbacks built into DCNS's budget, ensnaring politicians across the globe.

Allegations involving DCNS, formerly known as DCN, range from murder to bribery and corruption and go from defense procurement officials in each of those countries to some of the top politicians in France.

Under the French legal system, prosecutors under the control of the Ministry of Justice must make a preliminary enquiry, during which no one has access to the files, so that any information the police have obtained cannot be shared. The prosecutors have been stymied for years by the ministry. However, investigators appear to be losing their awe of politicians all the way up to President Nicholas Sarkozy.

In September, for instance, Nicholas Bazire, 54, the best man at Sarkozy's wedding to supermodel Carla Bruni, was arrested and charged with misuse of public funds in the 1995 presidential campaign of Edouard Balladur. Sarkozy was Balladur's campaign spokesman and budget minister at the time. Another friend, Thierry Gaubert, Sarkozy's cabinet chief when he was budget and communication minister, was arrested earlier. Sarkozy is seeking avoid the appointment of an instruction judge in an effort to keep the cases under control. But the political knives may be out for Sarkozy.

That increases the chances that investigating judges will allow prosecutors a more detailed look at DCNS's books to probe kickbacks in Pakistan, where 11 French submarine engineers were killed in a bomb attack, and Taiwan, where a number of murders and suicides have been recorded in connection with the sale of frigates to Taiwan's navy. The details can be found here.

William Bourdon, the leader of a three-lawyer team investigating Malaysia's US$1 billion purchase of submarines from DCNS for the Malaysian reform organization Suaram, earlier told Asia Sentinel he hoped his team would have access to the files by October. Bourdon was summarily deported from Malaysia in July after giving a speech in Penang describing some of the details of the allegations.

Prime Minister Najib Tun Razak was defense minister at a time when Malaysia bought two Scorpene-class submarines from DCNS. Included in the transaction was a €114 million commission paid to Perimekar Sdn Bhd, a company owned by Najib's close friend, Abdul Razak Baginda. The transaction has been mired in controversy since 2006, when Altantuya Shaariibuu, a party girl and translator ostensibly hired to help in the contract, was murdered after demanding US$500,000 from Razak Baginda, her jilted lover, for unspecified reasons. Razak Baginda was acquitted of her murder under unusual circumstances without having to provide a defense. Two of Najib's police bodyguards were convicted and sentenced to death. They have appealed the verdict.

Joseph Breham, a lawyer with Solicitors International Human Rights Group and a member of Bourdon's team, said in London last week that DCNS often budgeted as much as 8 to 12 percent of its total receipts as "commissions" paid to grease sales of armaments in third-world countries. Breham's speech was reported for the Malaysia website Malaysiakini by Miriam Mokhtar.

Malaysia bought two Scorpene submarines from DCNS for about US$1 billion and leased a third from a DCNS subsidiary for training. Of that, the €114 commission was paid to Razak Baginda's company, Perimekar Sdn Bhd.

Breham said Razak Baginda's company Perimekar had received the commission for "supporting the contract," which he said was a euphemism for unexplained costs, and also for "housing the crew" of the submarines in France. Perimekar was wholly owned by another company, KS Ombak Laut Sdn Bhd, which in turn was also controlled by Razak Baginda. His wife Mazalinda, a lawyer and former magistrate, was the principal shareholder, according to the French lawyers.

Breham questioned why such vast sums could be paid to Razak Baginda's company. The €114 million obtained by Ombak Laut, he said, was more than the amount paid by France to all of its primary school teachers for a year. He also revealed that DCNS's former finance director had written memos in which he alleged that €31 million of the €114 million had been used for "commercial engineering", a term Breham said had no legal meaning.

Breham said that in France, before 2002, any money used to bribe foreign officials was tax deductible. When the former finance director of DCN made a claim for the €31million allegedly used to bribe the Malaysians for the purchase of the Scorpenes, the Minister of Budget questioned such a large bribe, although he did eventually authorize the tax break.

Posted: 02 Oct 2011 04:06 PM PDT

The Malaysian Insider understands that the current civil service pay structure begins from a baseline of about RM500 a month, but with a new scheme set to be announced this month, this could rise to RM700. Shamsuddin said the average foreign worker now earned about RM750 per month and any rise would be pure disposable income that would be repatriated to their home countries.

By Shannon Teoh, The Malaysian Insider

The country's main labour centre's push for a RM1,500 per month base wage has raised the hackles of other stakeholders who warn that businesses will collapse while inflation spirals out of control with such minimum salaries.

Employers also said that as the four million foreign workers make up the bulk of those earning below that mark, their RM22 billion repatriated annually could double and far surpass last year's RM29 billion in foreign direct investment (FDI).

The Malaysian Trades Union Congress (MTUC) raised the bar last week from its previous demand of RM900 just as the National Wage Consultative Council (NWCC) held its first meeting to begin discussing a national minimum wage. Both public and private sector workers say wages need to go up to cope with inflationary pressures and rising prices of staple goods apart from fuel costs.

But others are wary of the distortionary effects of setting a high base wage, insisting instead that efforts should be focused on upgrading the glut of unskilled workers to fill the dearth of semi- and highly-skilled workers.

"This figure seems to be plucked out of thin air," Malaysian Employers Federation (MEF) executive director Shamsuddin Bardan told The Malaysian Insider.

Malaysia has always prided itself as a low-cost centre for manufacturing since the 1970s, offering tax incentives, cheap electricity, land and labour to entice multinationals to set up base. But prices are rising and the Najib administration has targeted 2020 for Malaysia to be a high-income nation.

Centre for Public Policy Studies director Ng Yeen Seen said that a minimum wage should be geared towards avoiding exploitation, rather than creating hard and fast ideals.

She said labour exploitation was particularly rife in Sabah and Sarawak, where some were paid as little as RM180 a month.

But paying cleaners, dishwashers and maids RM1,500 would wreak havoc on operating costs of most businesses as wage bills are usually kept under 20 per cent of total expenditure.

"The unions should ask themselves what will happen when most SMEs are forced out of business," said Ng, who is a member of the NWCC's technical committee.

The Malaysian Insider understands that the current civil service pay structure begins from a baseline of about RM500 a month, but with a new scheme set to be announced this month, this could rise to RM700.

Shamsuddin said the average foreign worker now earned about RM750 per month and any rise would be pure disposable income that would be repatriated to their home countries.

He pointed out that foreign labour already sent RM22 billion out of our economy last year and rising wages will likely to discourage foreign investors.

He said that Singapore already attracts far more FDI than Malaysia with RM114 billion against RM27 billion in 2008 and RM52 billion to RM4 billion in 2009.

But this was because the island's average productivity was 3.8 times Malaysia's while wages were only triple, making the republic "better in terms of cost per unit," he added.

READ MORE HERE

Kredit: www.malaysia-today.net

Khamis, 6 Oktober 2011

Malaysia Today - Your Source of Independent News

Malaysia Today - Your Source of Independent News

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