After one year’s reflection, former Minister of Youth and Sports Khairy Jamaluddin appears ready to fight the good fight. Here’s his take on..
Khairy has said that “even though we are the losers (of the elections), I want the country to succeed”. Yet he rates the economic policies of the present government a “C minus or borderline D”.
“When Lim Guan Eng came in as Minister of Finance, he was being an alarmist and said the debt stood at RM1 trillion. He didn’t define between direct debt and debt, that caused panic and unease amongst investors. In fact, direct government debt then stood at RM600 billion, which has now grown to RM800 billion. The balance of RM200 billion is ‘liabilities’ made up of government guarantees backed by assets, Private Finance Initiatives (PFI) and Public Private Partnership (PPP) payments. It’s accounting treatment, and there is a distinction between direct debt and liabilities.”
As to why very little foreign investment has flowed in, he posits, “The job of a finance minister is to reassure the financial community, to create confidence so that they will invest. But somehow Guan Eng has boxed himself into this corner and this is his great economic narrative, the size of the debt! He has no good economic narrative, and no new sources of growth.”
As Shadow Chancellor, what should be done to help the economy? “I would plug the holes of revenue. The government lost at least RM20 billion in revenue when they removed the GST. We should look at ways of increasing taxation – for those earning above RM1 million, and a new wealth and inheritance tax above a certain limit.”
Suggesting that such an increase would be unpopular amongst the wealthy he says, “We need to make the system fairer. When the government fixed the price of Ron 95 at RM2.08 per litre, revenue is lost to pay subsidies, which are regressive. Yet this subsidy mainly benefits the rich with their big cars. So they better implement the means-tested payment system soon so these subsidies can be reduced. We need to improve wages for workers – not just a minimum wage, but a living wage, according to location. Invest in infrastructure projects – we need to work with China as they have capital.”
And the criticism that Najib had sold our country to China? “I believe that Tun M was right to renegotiate the terms of the ECRL (East Coast Rail Link). Perhaps Najib was lax in that department… he was naive in matters of high finance.” The obvious irony of course is that as PM he had access to the best advice, and his own brother Nazir Razak a prominent banker at the time. “Perhaps Jay (Nazir) did try to offer advice, unsolicited or otherwise, but maybe he was met with a wall of silence, or with a ‘leave it to me’ ” in reference to his own experience.
And the government’s economic reform plan? “It hasn’t materialised yet. We are waiting for the budget. The tax reform committee is working on tax reform. We need greater clarity on physical infrastructure developments with a lot of multiplier effects to stimulate the economy, for example the ECRL, continuing the East Coast highway. They need a firm decision on the bilaterally postponed High Speed Rail to Singapore and look at financial models that are feasible and sustainable.
“There has to be fiscal priority for smaller infrastructure projects for the public good – for hospitals, dilapidated schools in the rural areas, and Sabah and Sarawak. The 11th Malaysia Plan ends in 2020 and they need to formulate the next five years and the focus in terms of sectors and industries.”
As to what has been done right, he says, “Most of the ministers have no experience in government and the onboarding of ministers takes time… but the Health Ministry is well run by YB Dr Dzulkefly. I love the cigarette ban. It’s such a statement of intent. The Telekom Malaysia fiasco aside, YB Gobind is a good minister. YB Anthony Loke at the Transport Ministry seems to be doing a good job, except for these new guidelines for Grab drivers.”
Succession – handover to Anwar and impact on economy.
“What the financial community want is certainty. They want a timetable of succession mapped out. Singapore does this very well,” citing that “we know Heng Swee Keat will become the next prime minister, and when.”
So when I ventured that succession has been mapped out, as Tun M has said that Anwar will succeed him after two years, we both pause at the irony of this statement and he says, “The incident of this sordid sex tape proves that succession is far from clear.” Khairy refuses to be drawn further into the “political intrigue of another party”, as intriguing as it may be for us to watch it unfold.
In the light of the opposition MPs recently throwing their support behind Tun M to extend his tenure as PM he says, “I am not interested in the succession issue from a party political perspective. I think opposition members who are getting involved are playing politics. This is unhelpful.”
“My concern is largely from an economic perspective. Investors are on a holding pattern when it comes to asset allocation to Malaysia because of political uncertainty. They want clarity on the succession timetable. For that reason, it would be good to indicate a date when the succession will happen.”
“It’s an electoral promise that Anwar will take over. You need to respect the tacit mandate that he has. Anwar will need to be PM for two reasons.”
“One, if he doesn’t then we will not hear the end of the matter and there will be no closure. Two, if there is one thing he is good at, it’s speaking multiple tongues. That can help navigate today’s toxic mix of identity politics. So, he would be good as a stop-gap. But not long term since he seems outdated and unaware of changes taking place in the modern world.”
What will it take for Malays to succeed?
This existential question continues to haunt the Malays and is used both as a political carrot and stick, by different parties. It was the subject of Tun M’s Malay Dilemma and also The Myth of the Lazy Native by Syed Hussein Alatas, who contends that the image of the indolent Malay is a hangover from colonial times. Expecting grand economic policies or political ideologies to come forth, instead, Khairy’s response of the “4Es” speaks to the more fundamental human condition.
- Education: The single most important factor for improving your life and essential for social mobility.
- Exposure: Understand a world view different from their own.
- Empathy: The lack of empathy is what leads to the tendency for jealousy and envy.
- Enlightenment: “Pencerahan” not to be straitjacketed by barriers such as fatalism or superstition, to really dissect and unpack issues.
On Empathy, Khairy points out, “the Chinese not only have financial capital, but a social capital in the spirit of kongsi, where they support each other. Malays don’t have that.”
This article is an excerpt from UNRESERVED’s September 2019 issue from the article KHAIRY’S MALAY DILEMMA