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Southeast Asia

The Deep Forces Preventing Reform in Malaysia

Prof. Murray Hunter

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The Pakatan Harapan coalition general election victory almost a year ago was supposed to herald a new reform era in a country spavined by corruption, cronyism and racism.

Very soon after Mahathir Mohamed was returned as prime minister after a 15 year absence and in a new role, he quickly made good on Pakatan’s promises to eliminate the GST, re-introd15-year absence fuel subsidies, seek the immediate release of Anwar Ibrahim from jail and charge former Prime Minister Najib Razak over the 1MDB scandal.

However, public disenchantment of the new Pakatan government very quickly developed as the pace of reform appeared to slow. The government flip-flopped over child marriage, then backflipped over its intention to ratify the International Convention on the Elimination of all Forms of Racial Discrimination due to protests organized by the ousted United Malays National Organization and ultra-nationalist Malay groups.

Shortly afterwards, it backed down from ratifying the Rome Statute of the International Criminal Court due to criticism from the Johor Royal Family. The report completed by the Council of Eminent Persons (CEP) on reform was put under the Official Secrets Act, and has not been made public. More recently, Mahathir’s quick dismissal of the Suhakam Report finding that “state agents” where most probably responsible for the abduction and disappearance of religious leaders Amri Che mat and Pastor Anthony Koh disappointed many.

There is now a perception that the Pakatan government won’t deliver what it promised. The by-election result in the Semenyih constituency was an indication of this, confirming Medeka Centre polling that both the prime minister and Pakatan were rapidly losing popularity.

However those expecting the government to create a new Malaysia forgot about the complex nature of the Pakatan coalition itself, the electoral landscape and the institutional and attitudinal impediments to reform. 

The Nature of the Coalition

The leading party, in terms of influence but not numbers is Parti Pribumi Bersatu Malaysia, formed by Mahathir in the run up to the general election to give himself a political vehicle. Although the party manifesto talks in terms of maintaining fundamental rights and fighting corruption, Bersatu is really a nationalist-Malay organization, believing in Islam as the state religion, upholding the Malay monarchy, maintaining Malay privilege and that of natives of Sabah and Sarawak, and keeping Malay as the national language. 

Parti Keadilan Rakyat (PKR) has twice Bersatu’s representation in the Federal Parliament and supports the abolishment of the New Economic Policy, the instrument that provides special privileges for Malays and other indigenous groups. In practice however, the party most often reflects its leader Anwar Ibrahim’s views. PKR’s structure is very similar to UMNO’s, and is currently strongly factionalized between the Rafizi Ramli and Azmin Ali groups. Recent party elections brought accusations of vote buying.

Under the Pakatan agreement Anwar is due to take the reins of Power from Mahathir sometime in 2020.

The third member is a breakaway group from PAS called Parti Amanah Negara, primarily a Malay based party standing for progressive Islam. It has 11 members of Parliament, where its leader Mohamed Sabu is Minister of Defense.

Next, the Democratic Action Party (DAP) is primarily a Chinese based party, although it has sort to be multi-ethnic over the years. The DAP is based on social justice, democracy, and secularism. Its support comes from working class and professional urban voters, where the party played a major role in assisting Pakatan win the last general election.

The above coalition mix suggests that its orientation is going to be towards maintaining the current status quo, according to the various party manifestos and actions. Other than the fight against corruption and support of popular policies like the abolition of GST, the pressure for reform comes only comes from the DAP and some members of PKR.

Thus Pakatan is a paradoxical coalition where the push for reform comes from a minority. What’s more, Mahathir has dominated coalition, calling the major shots in terms of policy and administration.

If and when Anwar Ibrahim actually becomes the Prime Minister, it’s still very unclear as to whether he will follow the reform path or pursue his wishes to implement a more Islamic path in government administration and education.

Anwar’s Position a big unknown.

Analysts close to government say it is attempting to buy time on reform by blaming the previous government and economic situation. However, talking reform is one thing, achieving it another. If the Pakatan government is going to firmly commit to reform, it has to overcome many impediments, some rarely discussed.

The Electoral Landscape

Although 65 percent of Malaysia’s population could be considered urban, cities’ parliamentary representation is well under that. About 70percentofy seats are rural based, thus heavily over-representing rural voters. Thus DAP and to some extent PKR representation are below what they should be, while UMNO, PAS, Bersatu, and Amanah are overrepresented, a legacy of decades of gerrymandering by the previous ruling coalition.

Thus any party or coalition group that wants to win a general election must win over a rural Malay electorate, making the politics of race and Islam of paramount importance. Until there is real electoral reform, race-based politics are crucial. Any reforms perceived as threatening Malay privilege would cost at the next election.

Does Pakatan really want reform?

The current anomaly benefits Bersatu over PKR and the DAP. This is especially the case if more UMNO defections come and the party expands into Sabah, as Mahathir has vowed. It is vital electoral reform takes place to place to bring in the concept of “one vote one value” through rearranging constituency boundaries and/or implementing some form of proportional representation before Pakatan can undertake any serious reform in the area of ethnic-equality of opportunity.

This is a major barrier to reform and will allow Malay-nationalist groups to dominate the national narrative, and sabotage any new initiatives.

The Civil Service

The Malaysian civil service is probably the most difficult barrier to overcome. There is an unspoken mission among offices and staff to protect the Malay agenda. Any policy or program is likely to be sabotaged if it is perceived to threaten Malay interests. The system has been built over the past 20 years on political nepotism, with civil servants clearly and openly aligned with the last government.

It is also a bloated service, employing nearly 1.8 million people, with duplicative ministries and agencies, wasting massive resources, built on job generation to keep ethnic Malays happy.

Although these problems have to be dealt with, retrenching staff would be politically costly. Thus it could take more than a decade to eliminate excessive numbers of employees, nepotism, and the culture of the Malay agenda.

Steep Learning Curve for New Ministers

Senior civil servants have been used to dealing with ministers who didn’t know their portfolios and were only interested in issues of personal benefit, swinging the balance of power from elected government to the bureaucracy. It is a daunting task for inexperienced ministers who don’t understand procedures and have little in-depth knowledge of their portfolios to manage their ministries.

The Royal Families

There are nine quite diverse royal families in Malaysia, and an Agong (king) who is selected by the Conference of Rulers every five years as head of state. The respective sultans and raja primarily act as constitutional monarchs, and traditionally had a close relationship with the former government. A few members of UMNO and a former Prime Minister had royal blood, and it has long been rumored that backroom deals and concessions were given for favors done for the government of the day.

Governments traditionally kept the royalty happy through bargaining. There were only a few ripples during the 22 years of Mahathir’s previous reign, in which he passed constitutional amendments to cut royal immunity from the law and eliminate veto powers over parliamentary bills.

Royalty have on a few occasions asserted their power independently, as when the Raja of Perlis refused to accept the Barisan Nasional nomination for Chief Minister of Perlis Shahidan Kassim and appointed Md Isa Sabu after the 2008 election. Sultans have sometimes been partisan as was seen in the Perak Constitutional crisis in 2009.

Mahathir’s current spat with Johor’s crown prince over appointment of a new chief minister for the state, Malaysia’s second most populous, shows that royalty remains a potential barrier to reform, especially on matters of Malay position, religion and their own survival. Continuing to placate the royalty will be at the cost of reform.

Deep State?

Just recently Foreign Affairs Minister Daifuddin Abdullah and Federal Territories Minister Khalid Samad talked about a “deep state” within Malaysia. They are referring to a network of royal family members, senior military personnel, senior police officers, GLC office holders, high ranking civil servants, politicians, intellectuals and business people who have a common interest and deep commitment in protecting the Malay position.

They are said to hold regular informal meetings around the country to deal with threats to the perceived order. This could be a discussion with someone who ‘needs to be pulled into line, ”taking action within the law, or even through extrajudicial action through ex-police or ex-military people loyal to the cause.

To recapture the confidence of the electorate who voted Pakatan into power in the last general election, reform is needed on the New Economic Policy which grants financial advantages to bumiputeras. The government must again attempt to put through constitutional amendments to restore the original position of Sabah and Sarawak in the Federation if it is to count on the support of Sabah and Sarawak voters. The electoral system must be overhauled so a future government will not be shackled by the Malay heartland on reform.

It’s very difficult to see the Pakatan Government dominated by Bersatu being too interested in reforming the NEP, or even seriously tackling the inequality of the electoral system.

The state of the civil service is dismissal and the problems haven’t even been defined yet, let alone solutions found. Ministerial experience takes time, some patience is needed here. However criticisms are increasing when Pakatan ministers are seen to behave just like their predecessors. When the sedition Act is now been used like Lese Majeste in Thailand, debate on the role of Royalty in Malaysia will be supressed. Expect a period of testing between the government and Royal Houses to continue until new boundaries are renegotiated. Finally the real secrets of government are still being kept secret. Reform begins with transparency and Mahathir himself doesn’t appear ready to step into that environment.

Author’s note: first published in the Asia Sentinel

Innovator and entrepreneur. Notable author, thinker and prof. Hat Yai University, Thailand Contact: murrayhunter58(at)gmail.com

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Southeast Asia

In Myanmar, Better Oversight of Forests a Vital Step in Transition to Rule of Law

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Authors: Art Blundell and Khin Saw Htay

For the first time, the Myanmar Extractive Industries Transparency Initiative (MEITI) has opened the books to share information with the public on revenue Myanmar’s government collects from harvesting timber. Last month, the MEITI released two reports juxtaposing statistics on production and tax payments from government ministries’ ledgers with corresponding figures reported by the state-owned Myanma Timber Enterprise (MTE) and forestry companies.

The reports are an important step toward improved transparency and accountability in Myanmar’s forest sector because they shine a light on irregularities that may point toward mismanagement or illegal activities. Unclear legal frameworks and weak enforcement in Myanmar’s forestry sector – a remnant of decades of military rule – have created an environment ripe for illegal logging and illicit trade, and mismanagement of natural resources.

The role of forests in Myanmar’s transition to democracy cannot be overemphasized. Money from illegal logging helped to fuel Myanmar’s decades-long civil war. Smuggling of illegally harvested timber to countries like Chinahas led to the loss of millions of dollars each year in government revenue. Corruption also fuels continued violence and prolongs armed conflict, especially in the heavily forested states that are home to most of Myanmar’s ethnic minorities.

The MEITI is committed to sharing its results at the state level—especially in Myanmar’s forest-rich regions. Myanmar’s citizens have the right to understand how their forests are being managed for the public good.

The EITI framework was launched globally in 2003 with a focus on oil, gas, and mining, given that these lucrative sectors are often key drivers of corruption in resource-rich countries. Myanmar is one of only a few countries (following Liberia’s lead) to add forestry to its EITI reporting, thanks to advocacy from civil society. 

Myanmar’s newest MEITI reports are a commendable step by the government toward transparency. But producing a report like this is not easy. The reporting highlights numerous disparities and irregularities in government record-keeping. This is not unusual for a first EITI report. It is also a major objective of the EITI: transparency leads to meaningful discussion about necessary reforms, while regular reporting creates an accountability mechanism to demonstrate progress.  MEITI is now preparing their next report covering fiscal years 2016-2017 and 2017-2018.

The MEITI is already driving progress. Myanmar’s Ministry of Planning and Finance (MoPF) has announced it will close the so-called “other accounts” maintained by State-owned Economic Enterprises, like the MTE, that have kept more than half their profits separate from the government’s central budget. Data in the MEITI report suggest that MTEretained74% of its $1 billion profits from fiscal years 2014-2015and2015-2016 in these other accounts–significantly more than the 55% that is permissible.

Myanmar’s Ministry of Natural Resources and Environmental Conservation (MoNREC) now holds important data that can be used to investigate and resolve irregularities uncovered by the MEITI reporting. For instance, the Forestry Department’s data on production does not match the data provided by the MTE, and it is substantially more than the Annual Allowable Cut (a government-determined sustainable level of harvest). Likewise, the MTE indicated that more teak was sold than its total reported supply. The source of the additional volume of teak logs is unexplained.

Reforms should help MoNREC address these irregularities.  Current reporting is obviously insufficient to capture reality.  With the help of a workshop that followed the MEITI launch, stakeholders are working with MoNREC to develop appropriate reforms for MTE and the Forestry Department, and to improve forestry sector governance in general. 

Opacity hurts the country in more ways than one. Illegal logging, corruption, and smuggling siphon off revenues meant for programs serving the public. Illegalities also threaten forests – and the communities that rely on forests for their livelihoods – and they drive off credible investment, leaving a gap often filled by investors with less regard for environmental and social regulations.

It is important to note that the MEITI reports cover only the period from April 2014 through March 2016, prior to Aung San Suu Kyi’s NLD Party coming into power. The current administration has committed to fairer distribution of benefits from Myanmar’s natural resources among its citizens, yet systematic barriers remain. Endorsing the recommendations from the MEITI report and implementing a roadmap for reform would signal the NLD’s commitment to good forest governance. Meanwhile, companies should do their part to comply with the law and accurately report production, sales, and other data in an accessible manner that allows for independent monitoring.

Myanmar’s forest resources hold great promise for the country’s people, its economy, and the government budget, if managed responsibly. The MEITI has a clear role in charting that path forward and in helping Myanmar manage its natural resources based on the principles of good governance.

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South-East Asia youth survey: Skills prized over salary

MD Staff

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Young people in South-East Asia face a relentless challenge to upgrade their skills as technology disrupts job markets, according to research released today by the World Economic Forum and Sea.

In a survey of 56,000 ASEAN citizens aged between 15 and 35, some 9% of respondents say their current skills are already outdated, while 52% believe they must “update their skills constantly.” Only 18% believe their current skills will stay relevant for most of their lives.

These concerns about skills are reflected in attitudes to jobs. ASEAN youths say the number one reason they change jobs is to learn new skills – the desire to earn a higher income comes second. 5.7% report having lost a job either because their skills were no longer relevant, or because technology had displaced them. Other reasons include the desire to create a more positive social impact and to have a more innovative working environment.

The survey also shows 81% of ASEAN youths believe internships are either equally important or more important than school education. In addition, over half are keen to spend time working overseas in the next three years, probably to gain new skills, with a significant portion wanting to work in another ASEAN country.

“It is impossible to predict how technology will change the future of work.” said Justin Wood, Head of Asia Pacific and Member of the Executive Committee at the World Economic Forum. “The only certainty is that job markets face accelerating disruption, where the lifespan of many skills is shortening. It is encouraging that ASEAN youths are aware of these challenges and show a deep commitment to lifelong, ongoing learning.”

Soft versus STEM skills

Overall, ASEAN youth attach greater importance to soft skills, and less importance to STEM skills – science, technology, engineering and maths. They see “creativity and innovation” as the most important skill – in which they also rank themselves highly – followed by the ability to speak multiple languages. They are confident about their soft skills, such as emotional intelligence, and list the two least important skills as “maths and science” and “data analytics”. They are particularly positive about their ability to use technology such as social media platforms, e-commerce sites, and e-payment systems.

Santitarn Sathirathai, Group Chief Economist of Sea, noted: “While it is essential that the region continues to invest in developing STEM skills among young people, we can also see that soft skills will have a vital role to play – even in the tech sector. In the world where knowledge becomes obsolete more quickly, soft skills such as adaptability, leadership and creativity will be crucial in ensuring young people have the resilience to constantly evolve their skill-sets in step with a changing market.”

The importance of re-skilling

Responding to the need to train workers in the face of technological change, the ongoing ASEAN Digital Skills Vision 2020 programme, launched by the Forum in Bangkok in November 2018 is assembling a coalition of organizations to train 20 million workers at ASEAN SMEs by 2020, and to provide internship and scholarship opportunities.

“The World Economic Forum’s ASEAN Digital Skills programme is delivering significant impact. In its first eight months, the initiative has already secured commitments to train over 8.9 million workers at SMEs, and to provide over 30,000 internships,” said Mr Wood.

Some 16 organizations have so far joined the programme: BigPay; Certiport, a Pearson VUE Business; Cisco; FPT Corporation; General Assembly; Golden Gate Ventures; Google; Grab; Lazada; Microsoft; Netflix; Plan International; Sea; thyssenkrupp; Tokopedia; and VNG Corporation.

“Government policy and business practices need to catch up to what is happening on the ground. Advances in technology will continue to impact labour markets into the future, and this requires ongoing education and skills training,” said Saadia Zahidi, Managing Director and Head of the Centre for the New Economy and Society at the Forum. “Anything less than a systematic shift in our approach to education and skills risks leaving people behind.”

Future jobs

When asked what type of organization they work for today, and where they would like to work in the future, ASEAN youths show a strong preference for entrepreneurial settings. Today, 31% are either entrepreneurs or work for a start-up. In the future, 33% want to work in an entrepreneurial setting. 19% of young people also aspire to work for foreign multinationals in the future (the current figure is 9%).

Traditional SMEs (as opposed to start-ups) are seen less favourably. While SMEs form the backbone of ASEAN labour markets, the survey reveals that small companies face recruitment challenges. 18% of youths work for SMEs today, but only 8% want to work for an SME in the future. One reason for the low interest is because young people say they receive less training at small companies compared to larger ones.

When asked what industry sectors are most attractive, the results reveal a clear preference for the technology sector, with 7% working in the industry today and 16% aspiring to work there in the future. In comparison, more traditional parts of the economy may face recruitment challenges. For example, 15% of youths work in manufacturing today, but only 12% want to work there in the future. Likewise, 8% work as teachers, yet only 5% want to work in education in the future.

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Being Wealthy Helps Singapore’s Naval Ambition

Bahauddin Foizee

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There’s an image that has been imprinted in the minds of the millions about Singapore, that it is a tiny yet wealthy city-state and an important Asian financial hub. But many are unaware of the fact that Singaporean armed forces are stronger than many regional forces, as it has one of the best navies, airforces and armies in the region.

Singapore’s navy, officially known as the Republic of Singapore Navy (RSN), in particular has been shaped over the years into a maritime force which is highly sophisticated and well-trained. An article on The National Interest ranked the RSN among the top five Asian navies, even when Indian Navy did not find a place in the list.

According to the aforesaid article, the RSN is a better navy than the Indian Navy in terms of quality, operation and policy-making, though the RSN lacks the experience, manpower and size of the Indian Navy. Arthur Waldron, an International Relations academic at the University of Pennsylvania, believes that if Chinese Navy, necessarily dividing the fleet, sends a taskforce to subdue the RSN at the Philip Channel, the narrowest part of the Strait of Malacca, the RSN would beat the Chinese taskforce.

Ambitious Procurement Plans

Singapore intends to build a navy that could protect its territories and economic interest from the potential hostility by any immediate larger neighbours, and more importantly a navy that could become lethal if combined with other regional and extra-regional navies (like Australia and Indonesia) against a greater navy (e.g. against Chinese navy). That is why, the RSN is currently on a spree to acquire more capabilities and next-generation platforms.

As part of its submarine force renewal program, the RSN is acquiring four Type 218SG submarines from Germany to improve the operational and combat capabilities of its submarine fleet. These new submarines will be having far more capabilities and durability — and are built to stay submerged about 50% longer — than those of the existing ones.

It’s worth mentioning here that submarines, unlike surface warships that have both peactime and wartime functions, is built to shoot and destroy targets as well as to conduct surveillance, even surveilling foreign coasts to gather vital intelligence. The very fact that a small city-state like Singapore has submarines in operation and is now renewing its fleet with even more capable submarines — shows how ambitious Singaporean navy has become about increasing its naval power.

Because of the larger capacity, these submarines have plenty of scopes for future upgrades, meaning that these submarines could be equipped with weapon systems such as long-range missiles to carry-out an offensive strike.

There’s more to the Singapore’s naval ambitions. Take for example the Joint Multi-Mission Ships (JMMSs), one of the RSN’s major new procurements. With full-length flight deck, these vessels would be almost 540 feet long with an estimated displacement of around 14,500 tons, and are expected to carry five medium and two heavy helicopters on a flight deck. What’s more, these vessels could potentially support limited operations of fixed-wing aircraft, including the F-35B warplanes which Singapore airforce is expected to purchase from the U.S. sometime in near future. Therefore, these vessels could potentially serve as aircraft carriers.

The RSN is also very well aware of the fact that wars these days are fought from a distant with the help of unmanned drones and unmanned vessels that carry cameras and weapons in order to see farther and respond quicker. Hence, the RSN plans to procure new vessels that will be having multiple unmanned air and surface vehicles to extend their reach and flexibility against threats. Take the eight new Littoral Mission Vessels (LMVs) for example. These LMVs will have a helicopter landing pad that will be able to carry an unmanned aerial vehicle. The aforesaid JMMSs and the new Multi-Role Combat Vessels (MRCVs) too will have unmanned air and surface vehicles.

Being Wealthy Helps

An Asian financial hub, the city-state of Singapore has a lot of wealth. The tiny landmass of the state and the already developed infrastructures allow the Singaporean government to allocate comparatively lesser wealth on infrastructures and other conventional sectors and to invest more on innovation and technology as well as defense and security. This is how the tiny state affords to make the quality defense procurements.

Singapore has been the Southeast-Asia’s largest military spender for several years now. Singapore was the top regional military spender in 2018 with an expenditure of US$10.8 billion and the Southeast Asian neighbour with the closest figures was Indonesia with an expenditure of US$7.4 billion. For 2019, Singapore has allocated US$11.4 billion for defense on its budget — something which amounts to about 19 percent of total government expenditures and around 3.3 percent of national GDP.

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