ASLI International Advisory Council Should Be Given The Opportunity To Decide Whether Mirzan Mahathir Possesses The Academic Credentials To Apologise And Retract Dr Limís Study When Mirzan Has Shown No Proof Of Flaws And Shortcomings In The Studyís Conclusions That The Bumi Corporate Equity Ownership Based On Market Value Is 45%.
by Lim Guan Eng
Petaling Jaya, Thurs
ASLI credibility and integrity is questionable following the decision by Mirzan Mahathir to retract academic Dr Lim Teck Gheeís report and apologise without providing any academic basis or rational. Whilst no Malaysians question Mirzanís political and business credentials as the son of former Prime Minister Tun Dr Mahathir Mohamad, Lim had resigned from ASLI in protest at Mirzan's actions as he stands fully behind his academic research.
In response to Limís resignation, Mirzan said it is better for Lim to resign based on principle rather than on any other agenda. Such response belies Mirzanís claims that ASLI was not directed by any party to retract the report nor was there any political pressure to do so. Clearly Mirzanís retraction was politically motivated and not driven by any flaws or shortcomings either in its methodology or research data.
Mirzan is disrespectful in that he does not care whether Dr Lim resigns or not but has also exposed his own political motives by questioning the agenda behind Dr Limís studies. This ignores the principles behind Dr Limís resignation letter ďÖto defend the position and integrity of independent and non-partisan scholarship. It is the fundamental right of the Malaysian public to question all government statistics and policies, more so when these are not transparent or defensible.Ē
The controversy is not whether par value is more accurate than market value as a measurement for real worth but that Dr Lim dare to defy and contradict the governmentís assertions of only 18.9% bumi corporate equity holdings. If market value is the issue, why is it that Mirzan is unable to show irrefutable evidence that market value is a less accurate reflection of real worth than par value. Or show proof that valuing 600,000 compaines at par value is better than the valuation of all 1000 companies listed on Bursa Malaysia is a more valuable.
Mirzan should be seeking truth from facts and not turn black into white. By failing to provide any academic rationale or data, Mirzan has not only done ASLI a disservice but also sacrificed a distinguished academic with international renown acknowledged by both the United Nations and the World Bank.
I reiterate that by resigning and standing by the findings of the study, Dr Lim has shown his courage in taking full responsibility for his research findings. Unlike Mirzan who made his statement not based on any research findings, Dr Lim has shown himself to be unique as an outstanding academic with upstanding integrity. Never before as an academic resigned from his job to uphold the truth of his research findings and such rare sacrifice has raised doubts about the reliability of government statistics.
Justice can only be done by inviting ASLI International Advisory Council the opportunity to decide whether Mirzan Mahathirís possess the academic credentials to apologise and retract Dr Limís study when Mirzan has shown no proof of flaws and shortcomings in the studyís conclusions that the bumi corporate equity ownership based on market value is 45%. The International Advisory Council comprising of foreign corporate captains and academics from Malaysia, America, Australia, China and India should at least provide some insights into the reliability of statistics.
No country in the world, except Malaysia, uses par value as a basis of valuing corporate value. For this reason Dr Lim has decided on market value as a closer measure of real worth. Even the methodology used is conservative. Dr Limís research shows the market capitalization of Bursa Malaysia is RM 715.4 billion as at 30 September 2005
Based on EPU 20% achievement rate of RM 715.4 billion (not 30% to take into account that bumis dispose off shares held for profit), bumi ownership is RM 143.08 billion. Government-linked corporations (GLCs) like Tenaga and Telekom comprise RM 260 billion or nearly 40% of Bursa Malaysia market capitalization. GLC awards almost all contracts and benefits to bumis. However Dr Lim uses 70% instead of 100% of GLCs market value of RM 260 billion to calculate bumi equity which amounts to RM 182 billion. This makes total bumi equity ownershipof RM 325 billion out of a total RM 725 billion market capitalization or only 45%.
If the bumis allotted 30% of all listed companies were calculated without taking into account shares sold for profit and GLCís holdings were distributed based on racial composition of 67% bumi and 33% non-bumi, then the bumi equity holdings would be much higher at RM 388 billion or 54%. Clearly Dr Lim has used a more conservative measure to calculate bumi equity holdings.
Is there any room for government statistics that are truthful, transparent and reliable if the government can behave in such a high-handed manner as to negate verifiable research not by facts but by emotion and abuse of power? Dr Limís resignation has only deepened the crisis of confidence not only at the reliability of government data but the entire administration of Prime Minister Datuk Seri Abdullah Ahmad Badawi.
* Lim Guan
Secretary-General of DAP