Media Statement

by Lim Guan Eng

(Petaling Jaya, Wednesday): International Trade & Industry Minister Datuk Seri Rafidah Aziz’s statement that is would issue a "big fat no" to any nation that asked it to dismantle a system of positive discrimination for its majority ethnic Malays as part of trade talks with US for Free Trade Agreement(FTA) is not only unfair to non-Malays and non-Muslim bumis from East Malaysia but it will make Malaysian industry fat and uncompetitive.

DAP have strong reservations about the FTA that is too weighted in the US favour. DAP is worried that the FTA would be pushed through without full consultation with workers, environmentalists, the financial industry, NGOs and most important of all ordinary Malaysians who may be adversely affected or even hurt by such a FTA.

However Rafidah is playing the nationalist and racial card to state that the discriminatory policies would not be affected to secure the support from the Malays and deceive them into thinking that they will not suffer. By stating that this is the sovereign right of Malaysia to implement its policies hides the fact that a FTA that only benefits the US at the expense of Malaysia, then the Malays would also be hurt if the country loses out.

Rafidah claims that she is all for making government procurement more transparent. Such statements are contradictory as discriminatory policies makes government transparency more difficult. Rafidah must also understand the racial quotas and discriminatory policies are the antithesis of free competition and open trade.

How can such discriminatory policies be justified when it benefits permanently one community at the expense of other communities? It also makes a mockery of equal citizenry where every Malaysian enjoys equal political rights and equal opportunities in education, economy and employment.

Such discriminatory policies were supposed to last for 20 years but it was further extended indefinitely until the 30% corporate equity stake has been achieved. This is untrue as many studies have shown that the 30% equity stake has been achieved. The 30% equity stake would have been achieved as early as 1990 if the government had barred those Malays receiving such shares from divesting or selling them.

Even allowing for the Malays to dispose off or divest these preferential shares granted for easy profits, several independent studies clearly show that the 30% target would have been achieved if market capitalization value of listed companies in Bursa Malaysia and not nominal par value of shares were used.

The government claims that bumis only held 18.9% of corporate equity in 2005. These are par value shares of all corporate equity. However if market capitalization of listed companies are used, according to a study by the Centre of Public Policy Studies under Asian Strategy & Leadership Institute(ASLI), then the bumi equity stake is 45%. As at September 30 2005, the total market valuation is RM 715 billion. The 30% bumi target is RM 215 billion. This is easily exceeded when the bumi share held by Government-Linked Corporations (GLCs) exceeds RM 325 billion or 45%.

How many poor and ordinary Malays or bumis from East Malaysia, especially non-Muslims own these shares? Such socio-economic injustice can be seen by the higher income inequality in Malaysia with the income share of the bottom 40% of households decreasing from 14% in 1999 to 13.5% in 2004, while the top 20% of households increasing from 50.5% to 51.2% in the same period. Even the United Nations Human Development Report 2004 shows the richest 10% in Malaysia controls 38.4% of our economic income as compared to our poorest 10% controlling only 1.7%.

Development should be equitable to give equal opportunity for every state and every Malaysian to better themselves. Pak Lah should be a Prime Minister for all Malaysians and to ensure their basic right to development regardless of race, religion or even region by ensuring development to all.

(16/08/2006)