Demographic sands shift under Malaysian elite; Recalcitrance seems to have been woven into Malaysia’s success story as a nation

Demographic sands shift under Malaysian elite


From:The Australian

April 16, 2013 12:00AM

RECALCITRANCE seems to have been woven into Malaysia’s success story as a nation.

Mahathir Mohamad’s extraordinary spell as prime minister from 1981 to 2003 is just a part of it.

From Australia’s perspective, Malaysia has been a leading example of Asia’s inexorable progress towards a form of middle-class prosperity – while its leadership style has been from time to time decidedly edgy, especially when the ruling class has appeared to be on the ropes.

The country has been led in the 56 years through independence from Britain by Barisan Nasional – a coalition of 13 parties dominated by the United Malays National Organisation – and its predecessor coalition.

Malaysia’s next election, on May 5, is heading towards a tighter finish than the country has seen in decades. There is even a prospect – still somewhat remote – that Prime Minister Najib Razak’s BN might be defeated by the People’s Alliance Coalition (Pakatan Rakyat) led by charismatic former deputy prime minister Anwar Ibrahim, which combines his own People’s Justice Party, the Pan-Malaysian Islamic Party (PAS) and the Democratic Action Party that has recently attracted the lion’s share of ethnic Chinese voters.At the last poll in 2008, the BN was shaken by the ground it lost – landing only 127 of the 222 seats, costing the two-thirds-majority needed for certain legislation, and also losing control of five of the 13 states.

Abdullah Badawi was dumped as prime minister after that unwelcome surprise, and replaced by the assumed safe hands of UMNO inner circle scion Najib, whose father was the country’s second prime minister and his uncle its third.

Najib, 59, was educated largely in England and had a brief commercial career before turning naturally to the family business – politics.

His first instincts in the top job were reformist – through the Government Transformation Project setting out to make the public service more accountable and efficient – and internationalist, recovering foreign investment flows.

He reduced the minimum ethnic Malay “bumiputra” ownership of listed companies from 30 per cent to 12.5 per cent.

He repealed the Internal Security Act, though he replaced it with measures criticised as being almost equally repressive.

Economic growth recovered swiftly after the global crisis, and has been sturdy since 2009.

But the opposition coalition has held together more firmly, and has campaigned more vigorously, than UMNO elders had expected. And the Bersih (“clean”) movement comprised of middle-class people seeking free and fair elections, and firmer human rights, has attracted huge numbers to its rallies, fuelling government anxieties.

Suddenly BN has flicked the switch, not to vaudeville, but to recalcitrance.

Mahathir this week said about Margaret Thatcher: “I think our characters were about the same. She was willing to stick her neck out.” And he has been sticking his out again, becoming highly visible and active in the campaign, and urging BN to wage a tougher campaign.

Najib underlined his own penchant for recalcitrance by becoming the first non-Arab leader to fly to Gaza as a guest of Hamas – a visit which he has been using to boost his stock among fundamentalist Muslims, among whom pro-BN commentaries have proliferated, including some vilifying Anwar as a “tool of the Jews”.

Journalist Azman Ibrahim wrote on the website of Utusan, an UMNO-backed media group, in Malay: “The Jews are just like Chinese gangster loan sharks who are sponsoring the opposition to subject the country to foreign rule.”

The Prime Minister’s Department has this year become the biggest spender on advertising in the country.

And vast handouts are being distributed directly. Najib last week gave bonuses for “contributing to nation-building” to each of state-owned corporation Petronas’s 40,000 employees.

He has softened his view of 2010 that the private sector must “return to the driver’s seat” of the economy, and partly as a result investment has slumped in Malaysia, foreign and domestic, says Asian Development Bank economist Jayant Menon.

We are seeing in Malaysia, as elsewhere in Asia, a maturing of the electorate that sometimes seems in advance of a rusted-on political class.

Over time, voters seek better management, more freedoms and fewer histrionics. Whether that clock has struck midnight for UMNO yet, we shall find out soon enough.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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