Malaysia

NEP policies keeping Malays ‘poor’ and ‘weak’, say analysts, politicians

By Shazwan Mustafa Kamal
September 02, 2010

Dr Mahathir predicted earlier this week that there would be an escalation in racial tension and division should NEP-style policies be removed. — File picDr Mahathir predicted earlier this week that there would be an escalation in racial tension and division should NEP-style policies be removed. — File picKUALA LUMPUR, Sept 2 — Analysts and politicians have hit out at Tun Dr Mahathir Mohamad for wanting an indefinite continuation of pro-Bumiputera New Economic Policy (NEP)-style policies.

They claim that NEP-based policies needed to be replaced with a more “merit-based” policy, saying that a majority of Bumiputeras “have not benefited” from the NEP during Dr Mahathir’s tenure as prime minister.

“I disagree strongly with Tun Dr Mahathir. Under the NEP and during his time as prime minister, a majority of poor Malays have not benefited from the race-based policy. It only served to widen the gap between the poor and a rich elite. Look at the urban poor today where a majority are Bumiputeras as well as Indians,” said economist Dr Subramaniam Pillay.

Dr Mahathir predicted earlier this week that there would be an escalation in racial tension and division should NEP-style policies be removed, likening the situation to the Communist revolution in Europe.

He stressed that the time was not right to introduce any policy which would “disregard the disparities between races in the interest of equity and merit.”

In justifying his arguments, Dr Mahathir said that during his time as prime minister and under the implementation of the NEP, Malaysia had enjoyed stability and good economic growth.

Subramaniam did not agree with Dr Mahathir’s explanation.

“During Dr Mahathir’s time, many countries in Southeast Asia or even Asia did not practise an open economy. There were very few countries which were open to foreign direct investments (FDI). Malaysia was doing relatively well, yes because there was no stiff competition from other countries at the time,” said the Nottingham University lecturer.

Subramaniam told The Malaysian Insider that due to “rising economies” like India and China over the past decade, Malaysia was in urgent need of a policy which would allow the country to escape from the “middle-income” trap.

“In spite of Mahathir’s NEP policies, it had favoured the few rather than improved the economic situation of the poor.

“The country requires a policy where it encourages the acquisition of survival skills. We don’t have that right now. We cannot compete with other countries because we don’t have the skills,” said Subramaniam.

He, however, added that a “needs-based” form of affirmative action was still required to help the poor.

Historian and political analyst Tan Sri Dr Khoo Kay Kim questioned the reason for Dr Mahathir’s “claims of an impending revolution.”

Khoo was doubtful that NEP-like policies would ever be scrapped, until the Malays and Bumiputeras were themselves ready for a change.

“What Mahathir is talking about is impossible. Since when can we remove the NEP? Unless and until the Malays themselves are ready, we cannot do anything,” said Khoo.

UKM lecturer Professor Shamsul Amri said while Dr Mahathir had a right to express his views, the former prime minister was in no position to make any changes to the country’s current economic policies.

“Let Mahathir say whatever it is he has to say. I do not see why he cannot have that opinion. He can no longer do anything, he is no longer in power,” said Shamsul.

He blamed politicians from both sides of the political divide for not doing anything to amend or scrap NEP-based policies.

“If people do not think it is relevant, change it. The opposition as well as Barisan Nasional talk too much but do not take any action.

“If they do not want NEP-based policies, please do something about it in Parliament,” Shamsul told The Malaysian Insider.

The academic claimed that although the actual NEP policy was no longer being used, the “spirit” of the NEP still lived within Article 153 of the Federal Constitution.

“The NEP is dead, but the spirit of the NEP is represented within Article 153 of the Federal Constitution. The spirit of NEP will always be there if Article 153 is there. If you do not want it, change it. Do something about it in Parliament,” said Shamsul.

The NEP, put in place in 1971, officially ended in 1990, but many of its programmes are still being continued.

Prime Minister Datuk Seri Najib Razak has said he plans to remove subsidies and many of the pro-Bumiputera quotas under economic reforms.

But Dr Mahathir and many Malay groups are opposed to the removal of quotas and equity targets, despite evidence suggesting Malaysia is being handicapped economically and is less competitive globally as a result of such policies.

“It would be illogical to maintain NEP-like policies. The NEP was introduced in the past because there was a gap between the Malays and the Chinese (in particular). Today, many Malays are now in the middle-class category.

“Today, we also have so much competition from overseas, countries like China and India are growing stronger economically, it will be pointless to maintain the NEP. We do not need affirmative action,” said Umno Pulai MP Datuk Nur Jazlan Mohamed.

He said Dr Mahathir’s argument was also “flawed” because of the fact that a majority of Malays were in the middle-class category and “have assets to lose in the event of riots or a supposed revolution.”

“The real poor are the Bumiputeras in Sabah and Sarawak . That’s why they have to come and find work in Peninsular. You don’t find many Malays going to Sabah and Sarawak for work. Mahathir is only looking from a Peninsular point of view,” Nur Jazlan told The Malaysian Insider.

Pua says Dr Mahathir wants to maintain the NEP to protect the interests of individuals within the ‘ruling elite’. — File picPua says Dr Mahathir wants to maintain the NEP to protect the interests of individuals within the ‘ruling elite’. — File picDAP national publicity secretary Tony Pua said the NEP had only resulted in the widening of income disparity “within ethnic groups.”

“In Malaysia, the NEP has resulted, according to the government’s own statistics, in a widening income disparity even within ethnic groups. This means that the gap between rich Malays and the poor is widening. Our Gini-coefficient measure is the highest in Southeast Asia.

“Hence if Dr M’s theory is right at all, that we are expecting a revolution, and he’s talking nonsense, but assuming he’s right, then a revolution would be between the poor Malays, Kadazans, Ibans, Indians and even Chinese, against the rich and wealthy class,” said Pua.

The Petaling Jaya Utara MP told The Malaysian Insider that Dr Mahathir’s insistence in maintaining the NEP was to protect the interests of individuals within the “ruling elite.”

“Dr Mahathir is flawed in his pursuit to retain the NEP, but intentionally so to hide his objective of protecting the ruling elite and their cronies, by using highly incendiary race-based arguments. This is clearly to mislead the rakyat at large in order to protect the interest of a few.

“He needs to revisit his history books to refresh his memory which has been failing in recent years. The ‘revolutions’ in Europe involved the proletariat rising against the bourgeois, or the poor against the rich, and was not a result of one race or religion against another,” said Pua.

Dr Mahathir has been increasingly vocal in speaking out against the New Economic Model (NEM) introduced by Najib, saying that affirmative action must still be carried out, signalling fears that Malays and Bumiputeras would stand lose out the most if the administration were to implement a 100 per cent meritocracy-based system.

The former prime minister revealed last week that he had written to the prime minister to offer his advice and let him know what he thought of the NEM.

However, Dr Mahathir said he did not expect Najib to consider his recommendations.

The feisty ex-premier had also mocked proponents of meritocracy last week, calling them racist and decried Malays who supported meritocracy as having misplaced pride.

His comments came after recent remarks by top banker Datuk Seri Nazir Razak — the CIMB group chief executive and the brother of the PM — who said that the NEP had been “bastardised”.

Nazir has been pushing for reforms while Dr Mahathir has been putting his weight behind right-wing Malay groups such as Perkasa, who believe Bumiputera quotas were a “right” of the Malays.

Dr Mahathir has also denied that the NEP had been an obstacle to the country’s development.

He has also mocked proponents of meritocracy, calling them “meritocrats” who are pushing for dominance by one race in all aspects of the country.