Traitors for leaving the country?

Malaysian politicians sometimes can say the darndest of things. Actually no, they do it ALL the time, and we can just review the Hansard of Parliment proceedings to see every single details. In fact, they should collect all the stuff Malaysian politicians say and archive it so that the future generation knows what kind of people they are electing into office.

First was the 'Information Minister', also popularly known as the Minister of Misinformation and in Twitterverse as #yorais. This guy blames Twitter and Facebook as evil tools used by the West to brainwash the public. Even our dearest Prime Minister, whom I have a high regard to, often make such racist and deplorable remarks that makes you realize just how human we all are. Let's just say he said something to the tune of the Jews should have suffered more and that Hitler should have 'done the job' right.

The latest minister to utter words of questionable quality is our second finance minister, Datuk Seri Ahmad Husni, who criticized Malaysians for leaving Malaysia and insinuated that it is tantamount to betrayal of the country and the sacrifices made by our forefathers.

“You and me, our children, we build our lives here and we have our homes
here. This is our homeland. I get very sad when I hear we have people migrating
to foreign shores. To me, this is wrong.
“Our forefathers have come here,
many years ago, bearing much hardship and deprivation. Why did they endure this?
Because they believed that their future generations will reap the fruits of
having to live on this blessed land,”

So far so good right? But wait, he continues:

“There is much here to strive for, there are many reasons to stay. Our fathers
have given up so much and they went through so much. Surely, our complaints are
merely discomfort compared to their sacrifices.
“Let us build our future in
this homeland of ours and work hard together to make things better,”

What the dear finance minister fail to acknowledge is that of the 300,000 Malaysians that emigrate yearly, it is not due to attractive or 'pull' factors that facilitate this decision. It's not easy for a person to leave his own country for another. It is actually a very, very hard decision because it is a land that you grew up in and to leave behind all your friends, family and posessions into the unknown is at the very least a scary endaevour. But yet despite this, many continue to do so in droves, with professionals making up the majority of the statistics. This can be due to no other reason than the 'push' factor.

Malaysians are sick of the politics that continue to be played.
Malaysians are sick of the corruption in the country.
Malaysians are sick of the lack of a clear leadership for the country.
Malaysians are sick of the lack of equality and unity in the country.

With the way the current administration is running things and with the power of the Internet, more and more Malaysians are waking up from their dream into an ugly reality where they realize that the nation now faces so many different challenges, and instead of a willingness to face them, we are beset by series after series of scandals involving the people that walk in the corridors of power.

RPK made an eloquent defense of the emigrants by bringing parallels of the current situation to one faced by the Prophet Muhammad when he emigrated to greener lands to escape persecution, oppression and injustice. Malaysia is a young country and many of its citizens are migrants, even Tun Mahathir who's father was actually from India. So what's with all the racial slurs against your fellow immigrants?

I end now with a story by on Ice Cream Seller who is now residing in Australia:

To Deputy Minister Husni,

A story (true) in response to your statement about emigration by ingrates.
Sometime in 1980, when I was a final year student in London, I had a very short teleconversation with my father. In those days, there were no call cards, Skype or the like and calls were expensive. He had a very simple message - "Dont come home, Son".

Now almost 30 years on, I see where he was coming from.

He advised me to stay on in the UK or if I found the weather not to my liking, told me to go to Australia - even if it meant that I may eventually marry a "white girl" as he put it. I was 23 and marriage was certainly not on my mind.

He was a 'pendatang'. This pendatang however secured a scholarship to study in Raffles College (the pre-cursor to the University of Malaya) and served some 30-odd years in various senior teaching positions culminating with the last few years in the Malay College. Amongst his students - a list of past and present ministers and opposition figures.

I didnt heed his advice till last year and spent the last 28 years in Malaysia. However, it became increasingly untenable to work here without compromising my values, integrity and conscience.

Why did he advise me such?

With hindsight, I saw his foresight. As an educationist, he saw we were heading to be another Ceylon (from where he was sent when orphaned), Burma, Philippines and in today's scenario, Zimbabwe.

He saw what the outcome would be when we mess up education with politics.
He saw that religion would be a divisive factor in years to come (he even encouraged me to learn Jawi as a 9 year old).
He believed that in a country like this, mixed marriages would help cement society.
He saw in some of our leaders of yesterday that even in their youth, they had unbridled cunning and only needed an opening to exploit that trait.
He saw in some of his students potential to be PM but said that would never be because they were "too smart for UMNO's liking".
He saw that given our racial demographics, religion would be used as a means to ensure the survival of a particular group.
He believed that eventually, the Malays would have a class war amongst themselves.
He said that even amongst the Malays, many of the English educated would opt to live away from Malaysia.

He told me promotions won't necessarily be given for competence. These are usually won in the Clubs (read political party today) and over a few drinks. Being a bit of an introvert myself, he encouraged me to join clubs, associations and play sports and travel. He said honesty doesn't necessarily pay in this world but still better to be honest and live with dignity.

Our home was (at different times) home to 3 delinquent Chinese boys - sent by the Juvenile court. He volunteered to take them in. Add to that a few other Indian boys. Though not my mother tongue, I spoke to my parents in Malay till I was about 10. We took in a Chinese lady injured during the war and she lived with us for about 40 years till she died. My father referred to her as his mother in law. I thought she was my grandmother even though my mother was not Chinese!!

By the late 70s and early 80s, he saw that this scenario would not likely repeat in the years to come. When he died in 1982, we were pleasantly surprised to see some of his students (by then in their 50s) come from different states for his funeral. One told me that it was my father that made sure he spoke flawless English and another told me how my father would bring the 6th Formers home from the hostel and used our home for dinner and to teach them social graces - including dancing (taught by my mother). Partners were arranged from the convent school with the blessings of the headmistress!!!

29 years on, I view his foresight through the same prism and now agonise as to whether I should tell my children the same. For now, I am allowing my eldest to pursue his tertiary education overseas. Maybe when he finishes, he may not be as shortsighted as I was. Pray God grant him wisdom and vision.

Last year, I resigned from my job, returned the company car and driver, said goodbye to my executive package and moved to Australia where I now live with no maid, no driver, no Audi 2.8, no golf, no teh tarik seessions, no bonus etc but am rediscovering humanity running a humble ice cream shop.

Sometimes we learn very late.

An ice-cream seller

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Malaysia's FX movement 'bizzare'. Sign of the rot deepening?

SHAH ALAM: Malaysia’s once strong foreign exchange reserve is bordering on collapse, according to a UBS Securities Asia Limited report. It says that in 2009, Malaysia experienced the biggest foreign exchange reserve losses among Asian countries.

It says official reserves fell by more than one-quarter on a valuation-adjusted basis.

Describing the situation as bizarre, it notes that Malaysia used to have the largest current account surplus in Asia–at around 17% of GDP.

“Over the past 12 months, Malaysian reserves nearly collapsed” while neighbours like Thailand, Singapore, Taiwan, Hong Kong and China “have seen sizeable increases,” it says.

It says foreign capital outflows from Malaysia in the last year was nearly 50 percent of its GDP.

“When we measure implied net flows using the same rough methodology as in used on Russia, the numbers are simply stunning. [Malaysia showed] peak outflows of nearly 50% of GDP,” it says, noting that the outflow was larger than anything witnessed in the world of emerging markets (EM).

The report also says Malaysia over the past 12 months recorded one of the biggest base money contractions in the entire EM world.

It asserts that recent outflows were “far, far bigger than those Malaysia experienced in the 1997-98 Asian financial crisis.”

The full report follows:

Malaysia–Another Bizarre Story

Confusion is a word we have invented for an order which is not understood. — Henry Miller

What it means
After last year’s series of notes on EM countries with “bizarre” money and credit behavior (Chile, Kazakhstan and Vietnam, see Tales of the Bizarre, EM Daily, 4-6 November 2009), we need to add one more to the list: the very strange case of Malaysia.
Question: which Asian country had the biggest FX reserve losses in 2009? The answer is Malaysia, and by a very wide margin; we estimate that official reserves fell by well more than one-quarter on a valuation-adjusted basis. Why is this bizarre? Well, in the first place because Malaysia runs a current account surplus – and not just a mild surplus but rather the largest in Asia, around 17% of GDP. Other structural surplus neighbors like China, Hong Kong, Singapore, Taiwan and Thailand have all seen sizeable increases in FX reserves over the past 12 months … and yet Malaysian reserves nearly collapsed.

How did this happen? In short, Malaysia must have seen massive foreign capital outflows – and sure enough, when we measure implied net flows using the same rough methodology as in our note on Russia earlier in the week (Watching Money in Russia, EM Daily, 5 January 2010), the numbers are simply stunning: peak outflows of nearly 50% of GDP, i.e., more than twice as large as in the “capital flight” case of Russia and many orders of magnitude larger than anything witnessed in the average EM country (Chart 2).1 In fact, the
recent outflows are far, far bigger than those Malaysia experienced in the 1997-98 Asian financial crisis (Chart 3).

It gets stranger. Unlike Russia, Ukraine, the Gulf states or other recent EM capital flight economies, Malaysia didn’t see any net external inflows in the run-up to the current crisis. Indeed, Malaysia has not recorded a year of positive net capital inflows since 1997, i.e., there wasn’t exactly a large pool of “hot” money parked onshore waiting to leave. Nonetheless, as shown in the above charts, capital is apparently still leaving Malaysia in large quantities as of the latest data points – long after most other emerging countries began to see net inflows again.

1 Implied capital flows in Chart 2 are defined as the difference between valuation-adjusted FX reserve accumulation and the current account balance. Flows in Chart 3 are defined as the difference between the overall balance of payments and the current account balance.

Nor, in contrast to all the above-named economies (and in contrast to Eastern Europe in general), did Malaysia have any noticeable increase in domestic leverage – both broad money M2 and bank credit actually declined as a share of GDP since the beginning of the decade.

So where on earth did the outflows come from?

Certainly not local deposits. Unlike Russia, Ukraine or other CIS economies, there was no outflow from the domestic deposit base; M2 growth in Malaysia is still very comfortably positive, in sharp contrast to the Russian figures we published a few days ago (Chart 4).

And this despite a massive, unprecedented decline in high-powered “base” money, as shown in Chart 4. Indeed, over the past 12 months Malaysia recorded one of the biggest base money contractions in the entire EM world, matched only by the Baltic states (Chart 5). This is in part because the Malaysian central bank responded with a sharp drop in reserve requirements to keep banks liquid … but still, we can’t help but note that the domestic financial system seems uniquely unaffected by apparent capital outflows.

In fact, perhaps the most surprising feature of the economy is that interest rates have fallen steadily. In 1997-98, with much lower ex-post outflow pressures, Malaysian short-term interest rates skyrocketed into the high teens; last year the same thing happened in some other countries with strong outflows pressures. Meanwhile, during 2009 Malaysian rates settled in comfortably at around 2% per annum and show no signs of rising substantially any time soon. What is going on? How do we square this circle? To be honest, we’re not really sure – but we strongly suggest the interested reader turn to ASEAN economist Ed Teather for further answers. For additional information on Malaysia, Ed Teather can be reached at edward.teather@ubs.com.

A pretty grim outlook on our foreign exchange. With such a low position, isn't our currency rendered vulnerable to attack ala Soros's run with asian currencies during 1997? We wouldn't have enough 'ammunition' to shore up the Ringgit and it will just turn into an ugly battle of attrition.

But regardless, the article is quite jargon-y. Anybody with financial insight care to decipher it for the rest of us?

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Comparing Singapore in 1965 with 1Malaysia in 2010

TRANSCRIPT OF A SPEECH MADE BY THE PRIME MINISTER, MR. LEE KUAN YEW, AT THE SREE NARAYANA MISSION IN SEMBAWANG ON 12TH SEPTEMBER, 1965.

Mr. Chairman, friends,
I want to say how delighted I am this morning to be able to join you in presenting these scholarships to 10 students, $100/- each, and not only to Indian students. The money probably came all from Indians because they are members of your Mission but the scholarships are also being given to Malays and to Chinese too.

It is these little gestures which make for harmony and understanding. I remember reading not so long ago about some special scholarships they were going to name after one of their leaders in Malaya, and they were going to get everybody to contribute, but the scholarships were only for one group. It makes life a rather difficult and trying business. But that is now no longer our business: we cannot interfere. We mind our own affairs.

But I say, neverthless, as Dr. Ismail has said in Canberra -- and he is an honest man who said that one day these two territories will come back again, but under very different circumstances and different conditions. And he was an honest man to say that if Singapore remained in Malaysia, there would be language and race riots in 1967. He said that -- I did not say that. He said that and it was reported in Canberra. I got the newspapers sent back to me. Because Singapore was setting the example in tolerance, multi-lingualism, multi-racialism; a multi-regligious, multi-cultural society. And there are some people whose grasp of history is somewhat limited and they are the people who shout these slogans: " One race, one language, one religion" It worries me. I think they ought to see the optician and put on their glasses. Then they will know there are many races, racial groups, but one nationality. I think they ought to see the ear specialist because obviously, their
ears are not hearing properly. Or, they will know that we speak many languages. And they will know that today Sunday, Christians go to church: Friday, Malays go to their mosques: Indians have Thaipusam, Deepavali and their ceremonial occasions; so with Buddhists, so with Seventh Day Adventists, on a Saturday. And what is wrong about that?

We will set the example. This country belongs to all of us. We made this country from nothing, from mud-flats. It is man, human skill, human effort which made this possible. You came, you worked -- for yourselves, yes. But in the process, your forefathers and my forefathers who came here: we built this civilization.

It is one of the few cities in Asia where you can get anything you want. You pick up the telephone: it works; and it not only works internally. You can pick up the telephone and speak to Delhi, London, Tokyo, Canberra ---anywhere you want. Do you think you can do that just by shouting slogans? You can get the best in any of the hotels in meal. European food? You can get the best in any one of the hotels in town. Chinese food? What kind do you like? There is Cantonese, Hokkien and Teochew. Indian food? There are South Indian, North Indian: anything you like. Malay food? You like Sumatran food, nasi padang? Where else in the world can you get this?

And I say, we will progress. I was sad not because Singapore was going to suffer: No. I was sad because by this separation, we could not help millions of our own people, our own countrymen in Malaya, in Sabah and Sarawak to progress with us. That was why I was sad. We could not help them any more.

They have now got to help themselves. They have got to throw up their own leaders and they have got to take a stand. We cannot interfere. Here in Singapore, in ten years, Geyland Serai will be another and better Queens town all the shacks will be demolished. I say that for Singapore because I do not think Singapore is boasting when it says it can do it. It will do it. But do you think in ten years, the kampongs in Malaya will have Queens towns? I do not think so.

If you want that, then you must have the thrust, the ideas, the dynamism, the push, the tolerance of each other. That is why I was sad for them who are our people. Not just Chinese and Chinese, Indians and Indians. They are many Malays here.

Half of our police force comes from Malaya. Their familes are left behind there. They will be quartered; they will live in modern civilised conditions. Their families will come down here and they will want to stay with them, and we will have to say "No" because there is a limit to what we can absorb. We have only got 214 square miles. It is a cruel thing to do this. But it has to be done, some people wanted it this way. We could have helped them emerge, but it was not be to be.

But I say to you : Here we make the model multi-racial society. This is not a country that belongs to any single community: it belongs to all of us. You helped built it; your fathers, your grandfathers helped build this, There was no naval base here, and it is not the British who built it. It was your labour, your father's labour which built that.. My (great) grandfather come here and built. Yes, he came here looking for his fortune, but he stayed -- my grandfather was born here.

Over 100 years ago, this was a mud-flat, swamp. Today, this a modern city. Ten years from now, this will be a metropolis. Never fear.
Some people think that just because we are a small place, they can put the screws on us. It is not so easy. We are a small place in size, and geography. But in the quality of the men, the administration, the organisation, the mettle in a people, the fibre therefore, don't try. That is why we got booted out. If they could have just squeezed us like an orange and squeezed the juice out, I think the juice would have been squeezed out of us, and all the goodness would have been sucked away. But it was a bit harder, wasn't it? It was more like the durian.
You try and squeeze it, your hand gets hurt. And so they say, "Right, throw out the durain." But inside the durian is a very useful ingredient, high protein. And we will progress.

40 percent more than 40 percent of the purchasing power of the whole of Malaysia is in Singapore. We may be 20% of the population of Malaysia, but purchasing power, the capacity to buy goods like microphone, clocks, drinks, fans, lights, television, transistors: the money is here because here they work. And if people do not want that 40% -- 44% market -- well, that is their business. We want to open the market with them, buy if they do not want it we will make our own soap ... We are buying soap from Petaling Jaya: Lux. You know, it is
always advertised on TV: Lever Brothers. It is no harm, we buy the soap: It is good for them; it is good for us. We can make motor-cars together for the whole of Malaysia. And never forget, if it came to the point then Lever brothers may have to set up a soap factory here, because after all, nearly half the sales are in Singapore.

You ask the Straits Times: what percentage of their newspaper is sold in Singapore? True, we are only two-million. But we have the highest literacy rate in the whole of Asia. Nearly half of Straits Times, if not more, is sold here. Here, everybody buys a copy. There, may be one kampong buys one copy and everybody looks at it. It is true. We are talking now in terms of hard cash; the hard facts of life. And if people wants to be hard to us, then we have got to survive. And we can keep this market to ourselves. But this is all shortsighted. Let us throw our eyes over the horizon into the future. What does our Dr. Ismail say: This will come back again. But under very different circumstances and ifferent conditions.

You know and I know that anybody who says, "Go back to Malaysia on the same circumstances". Will be called a lunatic; isn't it? We were patient; we were tolerant. We put with it hoping that they would see the light. But we had to be firm. We could not give in. So, as a result we are out.

History is a long process of attrition. It will go on. And one day, it will come back together. You see, this is not like a map and you can take a pair of scissors and cut off Singapore and then take it and paste it in the South Pacific and forget about it. It is not possible. This is part of the mainland of the continent of Asia. And that Causeway .... You know, the Japanese blew it up; it was still rebuilt. It is part of history; and you are part of history. You are part of this place as much as I am; as much as Inche Othman Wok, my colleague, is; and I say that is the way it will be in the end.

Finally, may I congratulate you for having made progress since I last visited your mission in 1963, and especially commend you for having made a symbolic gesture in giving scholarships not just to Indians. But Indians who contributed to the Narayana Mission took this money and gave it to Malay and Chinese students as well. In that way, we must prosper.

And I guarantee you this: there will be a Constitution which we will get re-drawn in which minority rights .... You know, it is very easy in Singapore for people to stand up and if you talk, "One race, one language, one religion," there will be a lot trouble, you know. We do not want that sort of thing. That is stupidity. So we are going to get the Chief Justice of India, Australia, New Zealand and a few others together with our own Chief Justice and a few of our eminent lawyers to draft "entrenched" clauses .... You know, "entrenched": no
government can just cancel the clauses. Entrenched, and enforcible.

If anybody thinks he is being discriminated against either for a flat or a scholarship or a job or for social welfare relief because of race, or language or religion, he can go to the court, take out a writ; and if he proves that it was because of discrimination on the ground of race, language, religion, culture, then the court will have to enforce the Constitution and ensure minority rights.

We are an equal society. You are equal to me; I am equal to you. Nobody is more equal than others. In some places, they say, "we are all equal." But what they mean is they are more equal, you see -- which makes life very difficult. But here, when we say "equal", we really mean it. We do not have to do it in Singapore. But we are thinking in terms of 100, 200 years, 1,000 years. You must help them emerge. And there is only one way: education and economist thrust.

And with those words, I wish you all peace, prosperity in Singapore.
Thank you.

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