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What to expect from Budget 2012?

Posted: 01 Oct 2011 10:34 AM PDT

By Ronnie Teo, The Borneo Post

KUCHING: With Budget 2012  to be tabled this coming Friday (October 7) in Parliament, Malaysians await with bated breath on what policies will be uncovered to further appeal to the likes of many.

Industry leader s have expressed their concerns given the dismal global economic performance with the region struggling on the path to recover, bogged down by the developed nations.

Indeed, the current global out look of the wor ld' s economy is nothing less than unfavourable.

With extreme volatility seen in global financial markets as well as equity markets all over experiencing sell-downs following continued concerns over the eurozone debt crisis as well as the slowing economic growth of a once-powerhouse United States, Malaysia's policymakers are up for a challenge in drawing up a budget that is aptly balanced for a sustainable growth path for our very own economy.

While focusing on the need to pump the economy in the midst of naysayers forecasting the possibility of a double-dip recession, Malaysia would also need to address the issue of a continuing fiscal deficit for the 15th year in 2012.

Certainly, a lot is on the plate of our Prime Minister Datuk Seri Najib Tun Razak, who also wears a dual hat a s Finance Minister This will be his third budget since taking over the post as Prime Minister in 2009.

To c ont inue mapping the country's growth, this budget is expected to include initiatives to complement the country's ongoing Economic Transformation Programme (ETP).

In 2011, the government had allocated RM214 billion in total for the budget. Of this amount, RM163 billion was allotted for operational expenditure while the remaining RM51 billion was for development expenditure.

Pre-budget dialogues were held earlier this year over a period of three months, involving about 300 investors, business folk and representatives from non-government organisations.

As such, many believe that this budget will be 'people-inclusive', steering to create an economic ecosystem and boost the private sector in a bid towards becoming a high-income nation by the year 2020 as planned.

According to the chief economist from Malaysia Ratings Corporation Bhd (MARC), Nor Zahidi Alias, the focus of the budget would be on reducing the burden of the low and middle income group that were affected by the rising cost of living.

"Based on the CPI, food cost has risen by 22 per cent since July 2007, the last time civil servants received an across the board increase in their salaries," he told BizHive Weekly.

"The CPI in general rose by 11 per cent within that time frame. So, measures would likely be introduced to relieve some of their burdens."

RAM Holding Bhd's group chief economist, Dr Yeah Kim Leng, said the coming Budget could certainly add to the country's growth momentum by further boosting investors' confidence and sentiments with new measures aimed at enhancing economic efficiency through market liberalisation and lowering business costs.

He noted that the strong inflow of Foreign Direct Investments (FDIs) of up to RM21.3 billion seen in the first half of 2011 signalled positively of the country's transformation efforts bearing early fruits.

"The rise in FDIs is an affirmation of foreign investors' confidence in the country's long term growth prospects," Dr Yeah added.

"As such, the government could focus on a re-statement of the New Economic Policy's 30 p e r cent Bumiputera target as a macro target rather than being implemented selectively across individual industries, firms and businesses.

"This, in turn, will boost investor sentiments and create a freer environment for the sharing of risks and rewards, spurring entrepreneurship and creativity, attracting foreign investments and retaining capi tal in the domest i c economy.

"All the 12 NKEAs will benefit either directly or indirectly from Budget 2012 that is expected to be growth-centred and people-friendly," affirmed Dr Yeah Kim Leng.

The economist noted that Sarawak would likely continue to be a major benef iciary of increased budgetary allocations to reduce regional disparity in economic development, eliminate hard core poverty and improve rural infrastructures and facilities.

The NKEAs where Sarawak had a comparative advantage such as oil, gas and energy-related industries, including upstream and downstream activities, were expected to receive further boost from the budget, either directly or indirectly, said Dr Yeah.

TA Securities' head of research, Kaladher Govindan, was of the opinion that Malaysian policy­makers were likely to emphasise on three specific factors this time round.

"Firstly, it would expedite projects highlighted under the ETP to buffer downside from slow­ing external demand. Secondly, it would introduce further liber­alisation and incentives to make businesses more competitive as our neighbours like Indonesia emerge as more conducive invest­ment destinations.

"Finally, it is expected to introduce more structured ben­efits/subsidies for the hard core poor to compensate for the rising income gap and loss in disposable income caused by inflationary pressures," he added.

"This may include a reduction in the middle income group and slower pace of subsidy reduc­tion."

Focus on the rakyat

HwangDBS IM's head of equi­ties, Gan Eng Peng, outlined his expectations of a 'rakyat-popu­larity-driven' Budget this time around as the General Elections was looming around the corner.

"However, we do not expect too much from this Budget as on one hand, the government needs to table a 'feel good' Budget. On the other hand, it is also in a strait­jacket due to the sluggish state of the global economy," he noted in an email reply.

"On the overall, we do not ex­pect this it to be a market-move­ment-type of Budget this year as there were a total of RM68 billion of stimulus packages be­ing pumped into the economy in 2009 to pull the economy out of the Global Financial Crisis.

"Remember, these monies will need to be recovered one way or another someday," he rational­ised.

OCBC Bank (Malaysia) Bhd's economist, Gundy Cahyadi, hoped to see continuing focus on helping the public in this Budget on the back of rising concerns from the worsening global eco­nomic outlook.

"This budget is going to be interesting in a way because it is happening at the same time that the global econo­my is taking another turn (for the worse) while the government has also kicked off its ETP and seen some encouraging developments in 2011," he said.

"There is probably going to be a continued focus on how to help the public, especially on matters concerning rising costs and so forth. So, the wage-productivity angle will see quite a focus cer­tainly," he added.

The same idea was brought for­ward by the head of research from Mercury Securities Sdn Bhd, Edmund Tham, who believed that Budget 2012, being the last budget before the next General Elections, would see emphasis on addressing public issues.

 

"Basically Budget 2012 would probably be the last budget be­fore the next General Elections. The federal government's budget would likely focus on addressing public issues, such as the rising cost of living," he affirmed.

"These may include areas such as housing, food supply chain, public transport, healthcare and education which form the main concerns of the Rakyat."

Boost in economic liberalisa­tion

During his interview with Forbes Asia Magazine in early September, Najib revealed his intentions for another round of economic liberalisation in this coming budget for long-term sus­tainable competitiveness.

He said liberalisation was good for "our long-term sustainable competitiveness of the country, building our intrinsic strengths not through protection or sub­sidies."

Gan from HwangDBS IM opined that this economic liberalisa­tion was building the country's competency to be on par with international peers.

"Malaysia has been progres­sively liberalising its economy and has been aggressively doing so over recent years," he said to BizHive Weekly in an email interview.

"It is a move to develop our human capital pool to be on par with the international peers in order to have an edge in the competitive 'laissez-faire' globalised market.

"Days of competing on weaker ringgit for our ex­ports and low-labour cost manufacturing models are long gone with China, India, Vietnam, Thailand and the likes joining the low-cost game," he added, noting that in order to propel Malaysia to a high income nation, the key was in develop­ing a highly-skilled workforce founded on a knowledge-based economy and to carve out niches in the services industry.

"This is the developed nation model that we can take a leaf from. To me, I would think the best place to seriously start relooking into is our education system and the next step is changing of the local mind­set to be more critical, analytical, innovative and creative."

OCBC's Cahyadi believed it was widely expected that the government would aim to lower its deficit for 2012 through this liberalisation stance.

"Analysts would want to watch on several fronts: Fuel subsidies? GST? Privatisation? It is widely expected that the government would lower its deficit for 2012, presumably only slightly, to about five to 5.2 per cent of gross domestic product (GDP) from the estimated 5.4 per cent this year.

"The liberalisation measures would be targeted to do just this: lower spending and boost rev­enue," he affirmed.

Liberalising too quickly?

Some sources have cited con­cerns that Najib's action of lib­eralising too quickly would be threatening to the economy.

"How do we define too quickly if the government and people refuse to change?" asked TA Securities' Govindan.

"The auto industry is a classic example. It failed to improve its competitiveness against in­ternational players for more than twenty five years (since Mahathir's era) while other less pampered players in countries like South Korea that started much later than us have started to rock the world.

"We are still talking about benefitting a privileged few with APs by extending it, whereas the government can collect the revenue directly. You will never be competitive if you don't want to understand the true meaning," he stressed on.

"To be competitive you have to inculcate a merit based culture in the entire system ranging from education, businesses, public service, politics and so on."

Mercury Securities' Tham was on the same page, saying, "There is always a trade-off between liberalisation and protectionism. Some sectors are not ready to be liberalised in the sense that the local players cannot compete effectively against foreign com­petitors."

Dr Yeah begged to differ, though, noting that "liberalising too slowly puts the economy at risk of being left behind by our neighbouring countries that are fast catching up with Malaysia in terms of economic efficiency, market liberalisation and ease of doing business."

Gan from HwangDBS asserted his idea that further liberalisa­tion plans would be in line with the ETP, as the government initiated in earnest, its efforts to allow the private sector to play a more significant role in the local economy as a whole.

"We have already seen the lib­eralisation in the shareholding of foreign financial institutions and we expect more will come in order to carve Malaysia a space in the international financial industry, especially in the Islamic finance sector," he disclosed.

Sectors in the spotlight

In a bid to drive more private investments, analysts expected to see a flurry of industry-spe­cific incentives coming up on the table.

MARC's Nor Zahidi was of the view that the liberalisation process would likely be focused on the services sector, a sector which accounted for almost 60 per cent of the economy.

He added that the vibrancy of the services sector was critical as it provided an avenue to gen­erate higher income which was in line with the government's aspiration to increase the in­come level of the rakyat.

"Notwithstanding this, liber­alisation measures should be implemented carefully and at a pace which is suitable with the level of development," he forewarned. "In other words, we should not rush into liberalising all parts of the economy within a short time frame. Proper se­quencing is required in such a process.

 

"A rush in the implementation of liberalisation measures can be detrimental to the economy as evidenced by the crisis that erupted in East Asia in 1998 which was caused by a rapid liberalisation of capital account (without proper establishment of financial market regulatory framework)."

According to TA Securities' Govindan, focus could also be given to the services sector but "expect some attention on the manufacturing sector as well to improve export competitiveness in terms of price and non-price factors."

"For instance downstream plantation players may find some adjustment in the tax structure to compete more effec­tively with Indonesian players," he gave as an example.

Govindan divulged the educa­tion sector (attracting foreign universities and talent), avia­tion (increased flight frequency and landing rights), banking (further relaxation in foreign ownership in banks, especially commercial banks and rules in hiring foreign talents), and healthcare (foreign ownership in private hospitals, incentives to open up biochemical indus­tries and so on) as further pos­sible beneficiaries.

What's up with taxes?

Manokaran Mottain, the head of research at AmResearch Sdn Bhd believed that the govern­ment may also aim to streamline the current tax structure in Ma­laysia by reducing income tax by one percentage point.

"As it stands, the current corporate tax rate remains at 25 per cent while the highest band of individual income tax stands at 26 per cent. In this regard, certain segments of the population have been lobbying for a tax review before the actual implementation of the the Goods and Services Tax (GST)."

Manokaran cited calls by industry players for both per­sonal and corporate taxes to be reduced to 20 per cent, if the government was serious about attracting FDIs and talents as well as implementing GST in the country.

"This will also serve as a posi­tive step towards preparation for GST by 2014 or 2015," he opined. "Lower personal income tax will also make it easy for the govern­ment-owned Talent Corporation to attract more skilled workers back to Malaysia."

The first mention of GST was brought up back in 2005 as a tool to reduce fiscal deficit. Since then, its implementation has been deferred year by year, despite many countries in the region adopting GST or its equivalents as it was accepted by most as a more equitable and efficient tax system.

"Potential tools that could be used to help reduce the fiscal deficit include introducing a clear schedule regarding GST's implementation,' believed Monokaran.

Pending implementation of the GST system, Mercury Secu­rities' Tham held expectations from the government to tweak or offer further rebates or incen­tives for personal income tax payers, such as for environment or welfare causes.

"The government may also announce some updates on the minimum wage policy plan. As usual, further announcements of major infrastructure and development projects are also expected."

Another segment which might possible see some tax changes is the Real Property Gains Tax (RPGT). HwangDBS IM's Gan believed an increase from the current five per cent to 30 per cent for assets disposed within five years would serve well to raise revenue to finance mega-projects.

"This will keep us on our toes to ensure out sovereign credit ratings continue to be in good stead," he added. "Sin tax could be on the cards as well to generate revenue."

ETP and flowing foreign in­vestments

After achieving the status of a middle-income country, the challenge for Malaysia was now to bridge the gap to a high-income status nation. However, the challenges that lay ahead were hard and difficult. This was due to the fact that Malaysia was no longer competitive against low-income countries as a high-volume, low-cost producer. At the same time, Malaysia has yet to move up the value chain and become competitive against high-income countries.

In order to make the leap, the government introduced the ETP, a comprehensive effort providing strong focus on key sectors as growth engines in ad­dition to economic reforms.

These two qualities provide the strength needed to propel Malaysia into a high income nation, targeting to lift Malaysia's gross national income per capita to RM48,000 by the year 2020. As such, analysts believed that Budget 2012 would play a complimentary role to ETP and its many initiatives.

"We think that things have been more encouraging for Malaysia this year and certainly the FDI figure is a positive," OCBC's Cahyadi said.

"The still positive growth prospect for the country would be an attractive point for foreign investors, but we probably need to see more before Malaysia's medium-term target can be achieved.

"The early part of the ETP and National Economic Model (NEM) is therefore very crucial," he affirmed.

"Presumably, investors are still attracted to infrastructure and commodity sectors in Malaysia. However, private participation still seems to be very low and there is probably a need for government to lead by example."

Cahyadi extended his belief that major companies still seemed to prefer investing overseas. The nation's net foreign direct investment for example, had been relatively low in the region for the past several years.

"Now that global risks have resurfaced, there is some notion that the private sector may still want to play the wait-and-see mode, and thus, it is crucial for the government to lead the way in the initial stage."

Nevertheless, Cahyadi noted an improvement on this front in the first half of 2011.

"There are two main factors that led to the inflow in the first half of 2011. One was the effect of ETP – a commendable government effort which has placed Malaysia back in the radar of the international investing community," pointed out HwangDBS IM's Gan.

"It has definitely created a lot of excitement. Coupled with the next factor, the bull run that continued from 2010 to early 2011, money was flowing into the emerging markets and Malaysia was one of the favourites.

"Unfortunately, the August bloodbath resulted in the spike in investor risk-aversions. Many foreign investors have sold-down their positions in risky assets such as emerging markets equities, regardless of the state of the fundamentals. It has been the case of 'sell first, ask questions later'.

"However, foreign, long-term investors who can see the poten­tial in our country's economy and strong fundamentals will continue to stay invested."

Analysts and indusrty sources alike concur that the upcoming reveal of Budget 2012 will deter­mine the nation's standing in the global economy as the Rakyat heads towards Vision 2020.


 


 

Embattled Malaysian PM unwilling to embrace radical reform: analyst

Posted: 01 Oct 2011 10:15 AM PDT

By Radio Australia

The promises earlier this month from Malaysia's Prime Minister Najib Razak to reform the country's harsh security laws were seen by many as a sign the government is turning its attention towards the next election.

The vote may come as early as next year, or as late as 2013.

But it seems the security laws will be an issue as will the calls for electoral reforms by the coalition of non-government organisations known as Bersih, or "clean". 

Presenter: Liam Cochrane
Speaker: Dr Syed Muhammad Khairudin, associate professor at the National University of Singapore

KHAIRUDIN: These promises are not something that is put in just merely to respond to the protest that has taken place a few weeks ago. I think the prime minister is sincere about making wide ranging changes and transformations in Malaysian society and in the laws. I'm sure that the ISA law will be removed from the current legal structure, but the question is with the removal of these ISA laws, will the current juridical practices that are in place in the Malaysian society be changed as well and I think the situation on the ground and the feeling on the ground is such that even without ISA, the ways in which laws have been enforced in Malaysia will not change very much.

COCHRANE: So it's more about the enforcement as well as the laws themselves?

KHAIRUDIN: Yes, I mean ISA has been there for the last 50 years, be it whether it is used as a way to in a sense sideline opposition in the Malaysian society or not. The fact is that there are many other indirect ways in which the Malaysian government had dealt with opposition parties and opposition groups. So the ISA, the removal of the ISA would in the sense, create some kind of confidence amongst the public with regards to the attempt by the prime minister to change the landscape and the politics of Malaysian society. But the question lies whether this change would result to other changes in the ways in which laws has been put in place in the country.

COCHRANE: And we have seen the way the Malaysian government has cracked down on protest. Quite recently, the protest in July, tens-of-thousands of people coming to the street demanding fairer elections as part of the Bersih movement. Now just as a bit of background before we get onto it. Bersih first emerged in 2007, but this recent action has been dubbed Bersih 2.0. They faced a huge police presence and were eventually dispersed with teargas and water cannon and that kind of thing. On the streets of Kuala Lumpur, how is the Bersih Coalition seen these days?

KHAIRUDIN: Well, it varies. I think among the young generation which I would call as the liquid generation of the current Malaysian society. They see Bersih as part and parcel of their own aspirations to structure the making of a new Malaysian society. A lot of the young people I spoke to, a lot of the young people whom I interviewed in my own research see Bersih as fulfilling their demands for a new political structure in Malaysia. Many of them are sceptical with regards to the current government's ability to make widespread changes in the political landscape in Malaysia and they saw Bersih as one of those strategies that they could employ to initiate change from below.

COCHRANE: That's with the youth and I presume the urban youth. What about outside the capital, in the countryside, what's the view there?

KHAIRUDIN: Well, I think the view from the rural side of Malaysia varies from village to village, from people from different status and class positions in society. In general, I think there is a substantial number of Malaysians who exist in a sense minimal position in Malaysian society. Many of them support Bersih, but they are not willing to participate in the process of political change. They constitute perhaps 30 per cent of Malaysian society. We have another 30 per cent of the young rural youth who saw Bersih as representing their aspirations and demands and, of course, 30 per cent of the Malaysian society right now, those are beyond the age of 40 years old see Bersih as stifling at one level, but at another level, it is part and parcel of the attempt by ordinary Malaysians to make their country a better place to live in.

COCHRANE: There was a crackdown as I mentioned against the Bersih protests in July. Has that changed at all, is the government showing any sign of softening its position on these opposition voices?

KHAIRUDIN: Well, I think the government tries to give a more human face to whatever it's trying to do right now. One thousand 700 people were arrested right after the Bersih protest and more came in right after that. Of course many of them were released in the end, but the current changes and the current situation that we see right now, the issue with regards to the interpretations of history in Malaysia and the libel case that is put against a leader of PAS currently, only goes to show the more things change, the more things remain the same. And it seems to me at least that whilst the government is now pressured to change the way in which it has been running politics and legislation in the country, they're unwilling to make radical changes in the ways in which they have conduct their management of the country.

COCHRANE: In the leadup to the Bersih protests, in July, the prime minister alleged that the leader of the Coalition was anti-Muslim. What role do you think that religion and ethnicity will play in the future of the Bersih movement and the Opposition's struggles?

KHAIRUDIN: Well, I think we need to understand Bersih as against the nature and the texture of the current generation that you see today in Malaysia. They are the liquid generation that sees beyond class, race, status, religion and ethnicity. They do not see Bersih as a Malay initiative or as a non-Muslim initiative, even though the one that is at the helm of the Bersih protests is a non-Muslim lawyer or attorney. They see Bersih as an attempt to create a new Malaysian society beyond race, class and religion and I think the ways in which Najib has portrayed Bersih as a non-Muslim movement somehow does not speak well about his understanding of the demands of the Bersih protesters.

COCHRANE: Is there a danger that that creates ethnic divisions or religious divisions?

KHAIRUDIN: Well, there are implications for sure and I think many Malays who has a more conservative outlook may see Bersih as an attempt to take away the special privileges that Malays have enjoyed in the country, but generally, the demands of Bersih were clear and that it was pretty straightforward. It was about electoral reforms in the country and these electoral reforms will lead to fairness in the system to the benefit of the Muslims and the Malays, as well as other communities in Malaysia.

COCHRANE: A lot of the coverage focused on the protest itself and the reaction from the government. What about those clear objectives that Bersih had, have they made in progress since July?

KHAIRUDIN: Yes, somehow it's lost in translation, the mainstream media have not been helpful in portraying Bersih in its true way and in its true essence. I think the ways in which we could arrive at the aspirations of Bersih and its true intentions is to go to the alternative media there in place. The internet has been helpful in that respect, and, of course, you have YouTube, videos and other alternative medias that are available for people to tap upon. . Certainly the mainstream media has not been supportive of what the Bersih protesters were trying to get at and I think it bodes badly upon the mainstream media in Malaysia.

COCHRANE: There's a bit of speculation about when the election is going to be called. What's your view, when do you think it will happen?

KHAIRUDIN: Well, I don't think it's going to be called upon so soon. So many changes are taking place in Malaysia. I doubt the Malaysian government knows what is happening really on the ground. So many groups are pulling the society in many different directions and the Coalition that is place right now, the Barisan Nasional, has yet to understand what is happening in that society. Elections will not be so soon. I would expect it to be called perhaps late this year or perhaps somewhere next year.

Najib the Reformer

Posted: 01 Oct 2011 10:12 AM PDT

By The Wall Street Journal

Malaysian Prime Minister Najib Razak deserves praise for his bold promise to reform Malaysia's legal code. In a speech on the eve of National Day earlier this month, he pledged to repeal repressive laws left over from the days of the communist insurgency. Among them are the Internal Security Act and the Emergency Ordinance that allow authorities to hold suspects without charge.

The announcement is the most solid evidence so far that Mr. Najib will live up to his promises to reform Malaysian politics. Even so, some Malaysians believe that this is a ploy to win the next general election, expected early next year, and that the new laws promised to replace the ISA will also be used to silence political opponents. Given the ruling United Malay National Organization's authoritarian past, the skepticism is understandable.

One only has to look back at July's Bersih 2.0 rally, a protest demanding electoral reforms, to see why Mr. Najib's reforms are not taken at face value. The police treated the peaceful rally as if it were another insurgency, arresting those wearing the movement's yellow T-shirts and attacking the protesters with tear gas and water cannons. The prime minister added insult to injury by defending the tough response.

Even if the rally was illegal, the regression to heavy-handed tactics alienated middle-class voters, who demand protection of their civil liberties. This dissent wouldn't have mattered 30 years ago, when the urban population was only 36% of the population. Today, however, the proportion has passed 72%.

That means that UMNO can no longer rely on the rural Malay heartland for a parliamentary majority. And if anything, the Chinese and Indian parties within the coalition have seen their support erode even faster. The voters are increasingly too young to remember the poverty and racial violence that created a desire for a paternalistic government that would shepherd development and stomp on populist passions.

The biggest challenge to Mr. Najib comes from within his own party. Even in his own cabinet, Malay nationalists have undermined his reforms by making inflammatory statements about ethnic minorities and defending special privileges for the Malay majority. Former Prime Minister Abdullah Badawi has warned that these elements will try to stop the repeal of the ISA and other laws that underpin their power.

The only way for UMNO to win elections and maintain control over the state resources it doles out to its supporters is to move with the times on the rule of law. While the opposition Islamist party PAS has put its own radical firebrands out to pasture to gain wider support, UMNO is a highly conservative and seniority-based organization. As a result, Mr. Najib has had to concentrate power within his own office in order to push reform over the objections of UMNO and the bureaucracy.

Mr. Najib continues to tack back and forth, and just last week the government charged an opposition politician with criminal defamation. But this risks pleasing nobody. He stands a better chance if he doubles down on reform.

For instance, the Malaysian media is still heavily censored by the government, as officials use the power to withhold the renewal of publishing licenses that expire every year. Mr. Najib pledged to repeal the annual process, but the government will still hold the power to revoke licenses. This breeds public cynicism about the media, since journalists make no secret of how officials order them to alter coverage. The government might get fewer puff pieces and more critical analysis, but renouncing control over newspapers and television stations would, on balance, improve the ruling coalition's image.

Likewise, the government's resistance to electoral reform is only hurting its chances of winning re-election. The prevalence of phantom voters and dead voters on the electoral rolls, as well as individuals registering multiple times while others have trouble registering at all, convinces urban voters that there will be no change until the opposition is in charge. The government says it wants to create an elaborate biometric system to tackle voter fraud, but this won't be ready in time for the next election. Acceding to the Bersih movement's call for simple and effective measures such as indelible ink to prevent stuffing of ballot boxes would help to restore trust.

Opposition figures tell us that it's unlikely they can defeat Mr. Najib in next year's election, and so he remains the best hope for political reform in the next few years. He may have shown his true colors, but his gambit to transform UMNO won't work if he goes halfway. Otherwise Malaysians may legitimately suspect that once he has a mandate he will revert to defending the prerogatives of his party's elite.

Malaysia’s Sham Sodomy Trial

Posted: 01 Oct 2011 09:52 AM PDT

By Joshua Kurlantzick , The Daily Beast

For the second time in roughly a decade, Malaysian opposition leader Anwar Ibrahim is facing trumped-up charges. But this time around, his supporters are unlikely to yield until they see real democracy.

Much has changed in Southeast Asia over the past decade. But travel to downtown Kuala Lumpur today, and walk along the Moorish-influenced public greens, and suddenly the Malaysian capital seems trapped in the 1990s.

At that time, the Asian financial crisis was battering the country's economy, and urbanites hit by the downturn and frustrated by the country's tightly controlled political system, had taken to the streets, where they were met by riot control troops, who battered them on a daily basis until the government's long-ruling coalition put Anwar Ibrahim, the country's popular opposition leader, on trial. The charge: Sodomy, a serious crime in a predominantly Muslim nation.

Though the trial was a farce—accusers later recanted their statements, and Anwar appeared in court with what the government called a "self-inflicted" black eye—he was convicted, and ultimately served six years in prison.

Today, the same story seems to be unfolding across the city. Anwar is again on trial for sodomy, in a sketchy case full of holes, which the government seems to have initiated to end his career and weaken the opposition. As a result, tens of thousands of middle-class Malaysians have been rallying, both to demand his freedom and for greater political openness, and once again, the government has responded with beatings, tear gas, and water cannon.

Yet unlike a decade ago, the demonstrators aren't likely to give up so easily. Though Anwar could once again be sent to jail, Malaysian politics have been changed irrevocably—both by him and by the current prime minister—and Malaysians seem unwilling today to accept anything less than real democracy.

Roughly 10 years ago, the trial of Anwar, a former government insider, drew sizable protests. But these demonstrations had little lasting impact. Anwar had only recently broken from the government, and the nascent opposition had few other leaders and little to no ability to organize in an effective fashion. The government had complete control of the print and broadcast media and easily rigged elections, making it difficult for activists to organize once the riot troops attacked. And while the Asian financial crisis had dealt a significant blow to Malaysia's economy, the country was still doing better than others in the region, leading to some political complacency among the middle class.

Over the past decade, the country and the region have changed dramatically, even if Anwar's plight has not. China and even Indonesia and Thailand have witnessed tremendous economic growth while Malaysia, whose weak education system and brutal politics have driven entrepreneurs out of the country, has seen its economy sputter. Educated Malaysians are fleeing the country, as is their purchasing power. And the spread of blogs and social media in a highly wired country has allowed activists to bypass the government-controlled media and combat election rigging, while a decade of largely grassroots organization has strengthened and diversified the opposition.

These days, a broad alliance of secular liberals and Chinese minorities who are inveighing against the state's affirmative action policies for ethnic Malays, have aligned with an Islamist party that wants Sharia law to have greater influence in a mostly secular country. More united, these seemingly oppositional forces have managed to win four Malaysian state government elections, and in 2008, came close to gaining a majority in parliament.

Though Anwar could once again be sent to jail, Malaysian politics has been changed irrevocably—by both him and the current prime minister.

During that election, an aide to Anwar named Mohd Saiful Bukhari Azlan suddenly came forward with new sodomy allegations against his boss. The fact that the accuser had waited 48 hours to make his accusation, ruining any potential semen samples—and that he met with senior government officials before making his claim—made the charges, which Anwar has denied, seem highly dubious.

As the trial proceeds this month, Malaysia's judiciary seems unsure how to handle it. In the past, as in Anwar's first trial, judges simply did whatever the government wanted; they fashioned their rulings to fit the punishment that the regime desired. But with public criticism mounting, and the opposition seemingly gaining momentum daily, the possibility that some of these judges could one day face punishment for unjust rulings has left them unsure of how to handle the case, and created an opening for a fair trial. Already, the judge has rejected some of the prosecution's evidence, a small victory that Anwar rarely witnessed during his previous trial.

Whether or not Anwar is convicted, many senior government officials seem to now realize that Malaysia is bound to change, and that putting Anwar behind bars will not end calls for reform. Though hardliners in the ruling coalition, which have governed since the country's independence in 1957, seem to be eagerly awaiting Anwar's sentence, the country's prime minister, Najib Tun Razak, has in recent months, begun to sound a lot like, well, Anwar himself.

In September, to the dismay of many Malaysians who had long viewed the prime minister as no different than his predecessors, Najib announced he was ending the decades-old Internal Security Act, which allowed the government to imprison anyone without charges. The prime minister has admitted that the country's economy is faltering, and he's tried to lure educated Malaysians back home. He's even called for ending decades of affirmative action programs designed to benefit ethnic Malays—a risky move in a Malay-dominated country.

Najib has gone so far that, even if Anwar is acquitted, the ruling coalition might genuinely triumph in the 2013 parliamentary elections. Whatever the outcome of the trial and the election, the country should finally be able to move forward and Malaysians should finally be able to put the 1990s behind them.

 

Whither MCA?

Posted: 01 Oct 2011 08:30 AM PDT

(The Malaysian Insider) - MCA president Datuk Seri Dr Chua Soi Lek will need nerves of steel and an elephantine hide when he steps up to the podium today at the party's 58th annual general meeting.

At 62, the MCA is being written off as irrelevant by the ethnic group it was formed to protect and this weekend's AGM looks to be its last before national polls are called, likely to be as early as January next year.

The party sailed through the Election 2004, only to limp home with 15 seats out of 222 in the Dewan Rakyat in 2008 and 32 states seats, barely scraping 30 per cent of the Chinese votes, according to analysts.

But the worse has yet to come. That support has shrunk to an estimated 18 per cent as seen in the Tenang by-election earlier this year.

The hundreds of delegates may wear smiles for the cameras, as the Youth members did today, but behind the closed doors of Dewan San Choon, the battle-weary veterans will be looking to Dr Chua to explain how he will lead the charge to ensure the Barisan Nasional (BN) co-founding party survives the likely stormy elections with such heavy baggage in tow.

The 64-year-old chief's sex-scandal past was dragged into the spotlight again Friday by no-less than his predecessor, Datuk Seri Ong Tee Keat, whom he deposed in a fraught party election last year.

Ong bluntly told The Malaysian Insider that he did not think Dr Chua was "winnable candidate" material, and admitted the MCA faced a dearth of names to run in the coming polls.

Observers remember that the ruling coalition's second biggest party lost big in Election 2008 because the ethnic Chinese were fed-up with its failure to voice out their concerns despite being in government, highlighting the perpetuation of discriminatory economic policies that have led to a number of Chinese tycoons taking their businesses elsewhere.

This week's application for merger talks between investment banking group OSK Holdings Berhad — whose single biggest shareholder is Ong Leong Huat, 67, and ranked by Forbes magazine as Malaysia's 34th richest man — and RHB Capital Berhad has become the latest talking point.

Concern over where this trend is headed was sharpened by Permodalan Nasional Berhad's (PNB) bid on Tuesday to take over the nation's second-largest developer by market value, SP Setia.

Sime Darby's recent acquisition of 30 per cent of property developer Eastern and Oriental (E&O) for RM766 million from businessmen including Terry Tham Ka Hon has also sparked concerns and is now being investigated for alleged insider trading.

And before this, casino operator Genting started its Singapore operations two years ago while YTL Group made a S$3.8 billion (RM9.1 billion) purchase in 2009 of the second-largest power generation company in the island republic, the 3,100-megawatt PowerSeraya.

And in 2007, Malaysia's richest man Tan Sri Robert Kuok also moved his palm oil operations out of Malaysia and listed them in Singapore in a move that was speculated to be caused by concerns over the government's continuation of Bumiputera equity policies.

"MCA is simply unable to protect the interest of the Chinese community," economist Darren Ng told The Malaysian Insider last night, adding strong anti-MCA sentiments were further amplified by its ministers' blatant corrupt practices and incompetence.

The decade-long RM12.5 billion Port Klang Free Zone (PKFZ) scandal, which has indicted two MCA transport ministers, including former president Tun Dr Ling Liong Sik and deputy, Tan Sri  Chan Kong Choy, is probably the single biggest case that has bled the party of ethnic support and resulted in Malaysia's plunging rating on the corruption index and which plays a role in foreign investor confidence.

"With Chinese voters already having negative sentiments towards MCA, the move by the government to achieve greater Malay dominance will not be in favour of the Chinese political party," Ng said.

But the biggest indictment of MCA's powerlessness may perhaps be Prime Minister Datuk Seri Najib Razak's recent whirlwind tour of Penang, the bastion of Chinese support under opposition DAP's control.

READ MORE HERE

 

Nik Aziz adamant hudud will rule Kelantan

Posted: 30 Sep 2011 03:52 PM PDT

Despite all that said and done about the hudud law, PAS is still bent on creating an Islamic state.

As far as DAP is concerned, the hudud issue is a closed chapter. But not so for Nik Aziz. The spiritual adviser of PAS has concluded that the Sept 28 meeting has made it clear that the opposition coalition of Pakatan Rakyat respects Kelantan's desire to incorporate the hudud law in its syariah law.

Jeswan Kaur, Free Malaysia Today

As fas as PAS spiritual guru Nik Abdul Aziz Nik Mat is concerned, his plans to implement hudud law in Kelantan is very much alive.

This is despite him not seeing eye to eye on the hudud issue with his Pakatan colleagues. DAP chairman Karpal Singh has made it clear that DAP would spare no efforts to thwart the implementation of hudud law in Malaysia.

"From the very beginning, DAP has also made known its opposition against any attempts by PAS and others to turn the country into an Islamic state.

"Let me make it very clear: hudud is not in line with the Federal Constitution and therefore it is unconstitutional," Karpal told FMT when commenting on the outcome of the Sept 28 meeting involving the Pakatan Rakyat top brass to discuss the hudud issue.

Hudud as practised in Saudi Arabia and Pakistan is the Islamic penal code that prescribes punishments such as stoning adulterers to death and amputating the hands of thieves.

PAS, which has been ruling Kelantan since 1990, had in fact passed the hudud laws but they were never enforced as the federal government had deemed it unconstitutional and threatened legal action if Kelantan ever enforced it.

Eventhough PAS leaders were adamant (about implementing Islamic laws), DAP said Karpal was equally firm in its opposition.

"You can't have Islamic laws in a secular state; it's as simple as that," said Karpal.

He pointed out that the Supreme Court led by the then Lord President Mohamed Salleh Abas had declared that the country was a secular state in a landmark decision on a case in 1988.

A closed chaper for DAP

DAP is firm that it will not be brow-beaten into changing its stand on the hudud law.

As far as DAP is concerned, the hudud issue is a closed chapter. But not so for Nik Aziz. The spiritual adviser of PAS has concluded that the Sept 28 meeting has made it clear that the opposition coalition of Pakatan Rakyat respects Kelantan's desire to incorporate the hudud law in its syariah law.

The only obstacle as Nik Aziz sees it is the federal government supported by Umno.

DAP votes a "No" to hudud but Nik Aziz says he is willing to wait until a consent is reached on this matter.

PAS is still tied to the policies it agreed to share with Pakatan in the Orange Book (Buku Jingga) apart from the provisions in the Federal Constitution.

Is there some sort of confusion that is shrouding Nik Aziz's thinking, because Karpal has set the record straight by saying hudud was unconstitutional and is not welcomed in any part of Malaysia, with Kelantan being no exception?

So, how did Nik Aziz, an 80-year-old seasoned politician, reason that his Pakatan colleagues respect his intention to implement the hudud laws? Was a "politically correct" message relayed to this spiritial guru instead of the blunt reality, which is that DAP is all willing to wage a war against PAS should Kelantan proceed with its hudud law plans?

Nik Aziz is optimistic that the hudud law will someday take shape in Kelantan. Where is this optimism coming from?

When Pakatan adviser Anwar Ibrahim on Sept 22 remarked that he supported the hudud law, that took the issue of the hudud law back to square one.

"For now, in general, in principle, I believe this can be implemented," Anwar had told reporters.

"It is a specific area that affects Muslims and does not impeach the rights of non-Muslims. The proceeding makes sure that the administration of justice is guaranteed," he was quoted as saying by a local online media.

Playing the devil's advocate

In an immediate reaction to Anwar's initial comment on hudud, Karpal said: "The punishments for these offences are flogging 100 times for intercourse between an unmarried couple, stoning to death for adultery, amputation of hand for theft, death for apostasy, flogging 40 times for alcohol consumption, flogging 80 times for false accusation of adultery and death by sword or crucifixion for highway robbery."

A day later, Anwar made an about-turn and said his comment on hudud was made in his personal capacity and had no relation to Pakatan.

It does look like Nik Aziz is not about to go to his grave without first putting in place the hudud law. The "call a spade a spade" religious apostle has a very clear vision of the hudud taking shape in Kelantan. His adversaries, as they will always remain, are the federal government of Barisan Nasional and the DAP.

Umno, taking advantage of this messy situation, played the devil's advocate, belittling PAS by accusing it of neglecting its Islamic agenda and pandering to its non-Muslim Pakatan Rakyat partners.

READ MORE HERE

 

Govt still in denial over ‘Project IC’

Posted: 30 Sep 2011 03:46 PM PDT

Deputy Home Minister Lee Chee Leong's ignorant statement on the contentious 'Project IC' issue has stirred a hornet's nest.

Lee, a senior MCA leader, has been accused by several Sabah politicians of playing to the tune of Umno which has been accused of granting citizenship and Malaysian identity cards to over 600,000 foreign migrant workers (predominantly Muslims from Indonesia and Mindanao in the Philippines) in Sabah, in exchange for their votes in elections.

Charlie Rudai, Free Malaysia Today

A federal-level deputy minister's denial that Sabah is a victim of "Project IC" – a planned illegal immigrant population explosion engineered by the federal government – has stunned Sabah Barisan Nasional coalition members.

Deputy Home Minister Lee Chee Leong on Thursday raised a storm of protests from leaders on both sides of the political divide who are furious that the federal government is still in denial over the issue.

Lee, a senior MCA leader, has been accused by several Sabah politicians of playing to the tune of Umno which has been accused of granting citizenship and Malaysian identity cards to over 600,000 foreign migrant workers (predominantly Muslims from Indonesia and Mindanao in the Philippines) in Sabah, in exchange for their votes in elections.

Lee's statement came days after Bernama quoted Deputy Prime Minister Muhyiddin Yassin acknowledging the problem.
Muhyiddin gave an undertaking to "look into whether the best way forward is a Royal Commission of Inquiry (RCI) or other approaches".

United Pasok Momogun Kadazandusun Murut Organisation (Upko) information chief, Donald Peter Mojuntin, was among those stunned by Lee's statement.

"This problem is quite different from the problem of forged or false identification documents. It is a serious allegation that has direct impact on our country's security and sovereignty," he said.

Mojuntin, who also chairs the Upko citizenship and security bureau, reminded Lee that Bakri Zinin, a Sabahan, when he was acting Sabah Commissioner of Police, had also described the matter as the "mother of all threats" to Sabah.

"With due respect to the deputy home minister who denied allegations by opposition parties about the existence of 'Project IC', it is not just the opposition parties saying so but also Sabah BN component parties like Upko, PBS and LDP.

"Perhaps the deputy minister should be given a tour of Kampung Boronuon or even the pasar (market) in Kota Kinabalu City.

"Al-Jazeera went to these places a few months ago and interviewed people who actually said
that they got their legal identification document through 'Project IC'.

"This came out in Al-Jazeera's international news broadcast on Astro channel 513," he said.

Mojuntin said the home ministry should also check out the other refugee settlements in Sabah and Labuan.

"Holders of IMM13 (special immigration visit pass) not only reside here but also illegal immigrants holding Malaysian ICs and MyKad.

"These places are usually a hive of illegal activities where locals don't even dare to venture," he said.

Ignorant Lee

Mojuntin also said Lee appeared unaware that Upko deputy president Wilfred Mojilip Bumburing had earlier also responded to his boss Home Minister Hishammuddin Hussein's request for proof in Parliament and had sent a set of documents containing facts and evidence to the ministry in early December 2010.

"Until now, there is no response apart from this latest remark by the deputy minister.

"We, Malaysians, in Sabah do not want our state and country to be inundated by foreigners who can easily come into the state and obtain legal identification documents through 'Project IC'.

"This is a clear and present danger that will have dire repercussions on our future generations.

"There are a lot of questions that need to be answered including the extraordinary population explosion in Sabah between 1970 and 2000.

"This issue has been raised persistently for the better part of three decades. It's been raised by the local people, leaders, politicians and NGOs.

"It is a persistent and prevalent issue that has been brought up through the mass media, blogs and social media (Facebook, Twitter).

"There have been various signature campaigns," he said.

Mojuntin said it is an issue that cannot be "swept under the carpet. It won't die down unless something concrete is done".

"After all, a RCI to investigate the illegal appointment of judges (Lingam video clip) and another RCI to investigate the death of Teoh Beng Hock have been set up.

"Project IC and the issue of illegal immigrants are matters of national security."

Slap on BN face

Opposition Sabah Progressive Party (SAPP) also criticised Lee for denying the existence of Project IC.

MP Eric Majimbun, who is also a SAPP deputy president, said Lee's statement is a slap in the face for all the state BN component parties that have been raising the issue all this while.

Majimbun believes Lee's denial was planned to protect Umno after Upko had forced Muhyiddin to acknowledge the problem that was given credence by Tuaran MP Wilfred Bumburing when he submitted a detailed report on the issue to Hishammuddin a year ago.

"Now the answer comes from his deputy minister from MCA to protect Umno," he said here yesterday.

READ MORE HERE

 

Of hudud, Datuk Nik Aziz and Bishop Paul Tan

Posted: 30 Sep 2011 03:43 PM PDT

Bishop Paul Tan is one of Malaysia's most outspoken Catholic prelates. His fellow bishops are known to be more conservative in their public outlook and tend to shy away from controversies, particularly those involving political parties. While his statements on hudud are bold and politically and religiously correct, I doubt his fellow bishops are in total agreement with him. Nonetheless, I applaud Bishop Paul Tan's refreshing stand on the matter. He is one Catholic leader who is vocal for the right reasons.

Borneo Post

FROM the outset, let me state that I have the utmost respect for PAS spiritual adviser Datuk Nik Abdul Aziz Nik Mat. He also happens to be one of the few Malaysian political leaders whom I do not know personally but profoundly respect and even admire.

I have consistently made this declaration for the Kelantan Menteri Besar in this column in the past. I did not change my mind even after he created the recent controversy over hudud following a dare by Tun Dr Mahathir Mohamad. Nik Aziz broached the subject again because it was his duty as a Muslim leader to do so. For that reason alone, I will not fault him even if I do not agree with his hudud intention.

Nik Aziz is, to put it simply, a religious leader. He breaths, lives and leads by Islamic principles. Naturally, in all issues concerning his party and Islam, Nik Aziz is the voice of PAS.

Thus, it was his responsibility, being the party leader in Kelantan as well as spiritual adviser, to respond to Dr Mahathir's dare to PAS to implement hudud in Kelantan.

I also believe that the Kelantan MB did not expect his response to arouse such emotions and evoke such a controversy particularly among his allies in Pakatan Rakyat. After all, it was nothing new – hudud and Islamic state are old, stale issues which were brought up many times in the past.

Politicians will always be politicians. They must always find ways and means to score points. The trouble with some of our politicians is that they seem to think they should make all decisions for us, the ordinary citizens.

At times, the politicians must realise that ordinary citizens are more capable of deciding what is best for themselves and the nation. This is because they have no political interests to protect and hence, are likely to think and act more rationally and objectively.

Like this on-going squabble over hudud, I will look at the issue in its overall perspective, which encompasses the question of an Islamic state too.

As a non-Muslim, I won't waste my time debating with others and worrying about hudud just as I would not want to worry unnecessarily over an Islamic state.

In this case, I would not want people in Pakatan Rakyat or Barisan Nasional to make that decision for me. I'm capable of thinking and acting rationally over the hudud issue.

If politicians want to squabble and quarrel over a religious matter, please do not drag me into it. Religion is something personal to me – it's a relationship between me and God. What I believe in and whether hudud or an Islamic state is good or not for me is up to me to decide.

To these politicians, let me tell them – please do not politicise religion! You'll be damned if you continue to do so.

Why am I unconcerned or worried about hudud or an Islamic state? Because I just do not see it ever happening in this country.

Haven't we gone through this before? PAS will never ever win enough seats in Parliament to change the Constitution single-handedly to institute an Islamic state.

Politics may be fluid but as far as the question of Islamic state is concerned, the racial and religious compositions of Malaysians are quite static. We can safely say that less than a fifth of Malaysians would favour an Islamic state at any time.

Another thing we can all be sure of – the people of Sabah and Sarawak will never ever agree to an Islamic state.

One more reason why I'm not at all worried or concerned about hudud or an Islamic state is that I do not think that it will ever happen in my lifetime. Neither will it happen in Nik Aziz's lifetime, or Mahathir's or Karpal Singh's, or Anwar Ibrahim's or Lim Kit Siang's. So what's the squabbling all about?

As a Catholic, I also noted with great interest the comments from Bishop Paul Tan about his agreement to the hudud being implemented in Kelantan if the Kelantanese so desire.

But he was also quick to qualify that there must be iron clad guarantees that the fundamental rights of non-Muslims will be protected.

The bishop's statement reflects a much more open stand than before, on the thorny issue of the Islamic state. I must say I am surprised by his remarks.

While others may think that this is the stand of the Catholic Church of Malaysia over the hudud issue, I have my reservations.

Bishop Paul Tan is head of the Catholic Diocese of Melaka and Johor, one of the smaller Dioceses in the country. Although he currently chairs the Catholic Bishops' Conference of Malaysia, Singapore and Brunei, that does not make him the top Catholic prelate in the country. The Archbishops and bishops rotate among themselves in chairing the Conference.

As there is no Cardinal in Malaysia, the Archbishop of Kuala Lumpur, Rt Rev Tan Sri Murphy Xavier Pakiam is considered the most senior of the Malaysian bishops as he heads the biggest Catholic archdiocese.

However, Archbishop Leopoldo Girelli as Apostolic Nuncio to the Republic of Singapore, Apostolic Delegate to Malaysia and to Brunei Darussalam, being the Pope's representative, is usually considered the highest Catholic authority in the country.

Bishop Paul Tan is one of Malaysia's most outspoken Catholic prelates. His fellow bishops are known to be more conservative in their public outlook and tend to shy away from controversies, particularly those involving political parties.

While his statements on hudud are bold and politically and religiously correct, I doubt his fellow bishops are in total agreement with him. Nonetheless, I applaud Bishop Paul Tan's refreshing stand on the matter. He is one Catholic leader who is vocal for the right reasons.

At the end of it all, I feel that we should drop the idea of hudud and focus on implementing laws based on the universal concept of human rights.

Malaysians must move on with the times and to keep abreast with fast developing globalisation, emphasise more on a liberal, equal, fair and just civil society.

What hudud? What Islamic state? We have been doing okay without them, so why bother to talk and quarrel over unnecessary issues at all!

 

Hacked off: Assange moans about unofficial ‘autobiography’

Posted: 28 Sep 2011 04:12 PM PDT

The correspondence, published as an appendix to an earlier Assange statement complaining bitterly about Canongate's release last week of "Julian Assange: The Unauthorised Autobiography", offers rare disclosures by Assange about his personal finances and well-being, and those of WikiLeaks.

Reuters

He laid bare the secrets of governments and corporations. But until now, WikiLeaks founder Julian Assange fiercely fought demands for more transparency in his own personal and financial affairs.

But a bizarre dispute between Assange and a Scottish publisher who last week released an "unauthorised" version of Assange's autobiography has prompted the WikiLeaks frontman to make public some of his own secrets.

Late on Tuesday, WikiLeaks published a sheaf of e-mail correspondence and transcripts of phone conversations between Assange, his literary agent and lawyers, and Canongate, an independent publisher based in Edinburgh, Scotland.

The publisher signed a book deal with Assange shortly after he was released last December from the London prison where he was briefly held following a Swedish request for his extradition for questioning in a sexual misconduct case.

The correspondence, published as an appendix to an earlier Assange statement complaining bitterly about Canongate's release last week of "Julian Assange: The Unauthorised Autobiography", offers rare disclosures by Assange about his personal finances and well-being, and those of WikiLeaks.

"At least until the Swedish case ends that's how my life is — full of constant struggles and interventions," Assange complained to a Canongate executive in a phone call in early June. "I can't not respond to these things that put me and the organisation in jeopardy."

The financial picture presented by Assange's disclosures is ambiguous and confusing. It surfaces as Assange awaits a court ruling on his long legal fight against extradition.

According to figures published by Assange, the financial deal that he signed with Canongate ought to have brought him a level of financial reward commensurate with what he and his supporters regard as his status as an anti-secrecy crusader and international celebrity.

US$1 million (RM3.16 million) deal

In a transcript of a June 16, 2011 phone call he had with a Canongate representative, Assange talks of how £250,000 (RM1.2 million) he got as a book advance were under the control of Finers Stephens Innocent, a London law firm which represented him in the extradition case.

Assange claims that the advance was transferred to the lawyers "wholly without my consent," and that the law firm was refusing to release it due to a billing dispute.

Mark Stephens, the lawyer who principally represented Assange, declined comment.

It's unclear why Assange chose to publish details of his personal affairs at this juncture. He did not respond to requests for further comment.

In other newly-published correspondence, Assange discloses for the first time what he says Canongate agreed to pay him if his book was completed as planned. Assange's lawyers claimed in a September 12 letter to Canongate that the publisher owed Assange £225,000 on delivery of a completed manuscript and another £175,000 on the book's release in Britain.

Together with the advance, this meant the book deal was apparently worth at least £650,000 to Assange — more than US$1 million at current exchange rates.

It is not clear whether this figure included an advance payment to Assange from US publisher Knopf, or whether it included payments intended for Andrew O'Hagan, a British author who agreed to be Assange's ghost-writer.

A former member of Assange's inner circle said that, with additional revenues anticipated from deals Canongate struck with foreign-language publishers, the total received by Assange could have run as high as £2 million — one of the biggest such deals since former US president Bill Clinton's memoirs.

However, Nick Davies, Canongate's publishing director, told Reuters that while his company at one point had lined up 38 international publishers to put out local editions of the book (as well as Knopf), these publishers walked away when it became clear the book was in trouble.

Davies said that in March, when a first draft of the book was due to be delivered, Assange began to show disaffection with the project. "He felt it was and is too personal," Davies said, adding that Assange later declared: "All memoir is prostitution."

Computer glitch

Davies said Canongate made various efforts to resurrect the deal and draw Assange back into it, including a proposal that Assange would get another six months to fix the book. However, Assange failed to deliver, at one point informing the publisher that he had lost all of the work he had done to fix it through a computer glitch — an explanation which Davies said "rang alarm bells" given Assange's reputation as a computer wizard.

Earlier this month, Davies said, the publisher gave Assange a final opportunity to serve up a "new vision and timeline" for the book. But Canongate warned Assange it would go ahead and publish a draft which had been finished by O'Hagan in March with or without Assange's assent if he didn't cooperate.

In reply, Assange threatened Canongate with an injunction to stop publication. The injunction has not materialised.

Canongate then went ahead with a well-publicised launch of Assange's "unauthorised" memoir. Davies said the publisher had to "mitigate our losses" because when they asked Assange for their advance back, he admitted he had signed a paper instructing his agent to turn the money over to his lawyers. The publisher concluded Assange was "never" going to be able to repay the advance, Davies said.

After the publisher went ahead with publication, Assange complained, "This book was meant to be about my life's struggle for justice through knowledge."

"It has turned into something else. The events surrounding its unauthorised publication by Canongate are not about freedom of information — they are about old-fashioned opportunism and duplicity — screwing people over to make a buck," Assange said in a statement posted on WikiLeaks.

So far, the book is turning out to be a bonanza for nobody, with UK sales for the first three days of publication totaling 644 copies. Davies said Canongate hopes sales will pick up steam, and says some of his firm's erstwhile foreign-language partners have expressed interest in returning to the fold.

For the moment, however, the publisher said, "The only person who has made any money out of this is Julian. He's got our advance money."

 

Is Petronas Dr M’s next target?

Posted: 28 Sep 2011 03:32 PM PDT

Tun Dr Mahathir Mohamad 'moves' from one extreme to another without any feeling of guilt.

Mohd Ariff Sabri Aziz, Free Malaysia Today

The real Tun Dr Mahathir Mohamad is emerging. Former prime minister Mahathir looks out for the welfare of the corporate world – the big businesses, the crony capitalists.

He wants to ensure subsidies go to Independent Power Producers, juiciest of deals go to highway toll operators, big business continue to get bigger businesses.

He will support the Gamuda-isation of Malaysia. Yes sirree folks, Mahathir is the champion of corporate welfarism.

Under this version of welfare, the power of the state is used to protect the rich and powerful rather than the poor and the society in general.

Mahathir is now the spokesman of welfarism.

Contradictory Mahathir

Mahathir continues to be the embodiment of contradictions. He moves from one extreme to another without being burdened with the feelings of guilt.

He is generally seen as the man responsible for breeding the culture of corruption, yet he can also be the spokesman for a clean government.

Ex-ministers who listened to his solemn intonation that the government is corrupt from the top to bottom, could have puked all over the place in one of those gatherings of ex-ministers.

He quits Umno when he thinks Umno is rotten to the core. Each level of the Umno leadership is corrupt, he has said.

And this, he had told a social gathering of ex-minister, would include premier Najib Tun Razak. And when Umno was led by Tun Abdullah Ahmad Badawi, he left Umno.

READ MORE HERE

 

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