It took nine years for them to finally wake up

It took nine years for them to finally wake up

THE CORRIDORS OF POWER

Wednesday, 24 February 2010

Today, there is so much brouhaha about the Oil Royalty (illegally renamed ‘Wang Ehsan’) issue. Even Tengku Razaleigh Hamzah has awoken and it looks like a hornets’ nest has just been stirred. On 18 February 2001, I wrote the article below called Fight Fire With Fire. On 11 April 2001, I was detained under the Internal Security Act on grounds that I am threat to national security. I was earlier also arrested under the Sedition Act on Hari Raya Haji and the police raided my house and confiscated my computer. And this article was one of those ‘grounds’ they used against me to justify my arrest and subsequent detention.

THE CORRIDORS OF POWER

Raja Petra Kamarudin

Fight Fire With Fire (Raja Petra Kamarudin, 18 February 2001)

Two weeks ago I met Ustaz Haji Abdul Hadi Awang, the Chief Minister of Terengganu, to interview him on behalf of Berita keADILan. The question I asked was how would the state fare without their RM800 million a year oil royalty and what does the state intend to do about the matter?

Three courses of action

Ustaz Hadi laid out three courses of action the state is taking. First is administrative, the second political, and the third legal.

On administrative, the state has already sent a high-powered delegation to meet the higher-ups in Petronas. On political, the State would go round explaining the issue to NGOs and political parties. Finally, on legal, the state has set up a technical committee to explore the possibility of taking Petronas to court.

With all due respect to Ustaz Hadi who I have personally known for more than 20 years (30 years now) and whom I have extremely high regards for, I feel all three avenues are a dead end and will come to naught in the end.

First of all, on the administrative route. So they have met Petronas and Petronas has not denied that a legal contract does exist between the national oil company and Terengganu. But what good does it do? Terengganu will still not get its money. It is not Petronas that refuses to pay Terengganu its money but Mahathir.

Mahathir is the real culprit - not Petronas

Under the Petroleum Development Act (144) 1974 passed by Parliament in 1974, the Prime Minister has absolute and final authority over Petronas. That’s it, Mahathir decides and dictates what Petronas does and there’s no two ways about it. And unless Terengganu talks to Mahathir personally Petronas can do absolutely nothing to help Terengganu.

More details on this Act have been included in this feature as a footnote below.

Should Terengganu then talk to Mahathir?

No way! Mahathir hates PAS from the bottom of his heart and he would rather die than give in to PAS.

Terengganu’s weak political action

So, over to option number two -- political. The State is going round explaining to the people the real issue behind Terengganu’s oil royalty being withdrawn. But the people already know the facts. Why try to convert the already converted? The people do not want talk. They want action.

Can Terengganu really get a fair trial?

Finally, legal action. Does Terengganu really believe it can get a fair trial in a Malaysian court? If it does then pigs can fly. Trials and court cases in Malaysia are rigged and you can bet your last oil Dollar that the Terengganu versus Petronas court case will be heavily rigged.

Anyway, the trial will go on for ten years or more. By then Terengganu will be so broke PAS will beg UMNO to take the State off its hands (it did in 2004). UMNO can afford to wait ten years (it only had to wait three years). Can PAS? With no money in the pocket, time creeps by ever so slowly and ten years can feel like a life sentence.

No, all the above will not work. Let us not be idealistic but be realistic. Let us analyse what is really going on.

First of all, it is Mahathir and not Petronas that’s the culprit. Secondly, it is a political decision taken for political considerations and the action too is political. Lastly, stop talking and start acting.

Taking all this into consideration, immediate action is required and the action must be political and not legal or administrative.

And the type of political action to take?

Terengganu is too paranoid about being seen as “aggressive”

Before I continue I must add that Terengganu State is too paranoid about its image and is reluctant to be seen as doing anything “illegal” or “ganas”. That attitude should change. Mahathir did not care about his image or whether he is seen as ganas when he withdrew Terengganu’s oil royalty. In fact, Mahathir said no such agreement exists. If this is not ganas I don’t know what is.

Fight fire with fire

Terengganu must fight fire with fire. Terengganu must realise it is fighting for survival and its (political) life is at stake. Terengganu must “take to the streets”.

First, all East Coast rakyat should be told to boycott Petronas petrol stations. So the petrol station owners go bankrupt, but that’s the price of “war”. How can the petrol station owners continue to support Petronas when it is killing off Terengganu State anyway? Maybe they deserve to go bankrupt.

Blockades should be set up at the Petronas refinery in Kertih so that the tankers cannot get in or out. “Guards” should be placed at all Petronas petrol stations to “discourage” people from patronising the place.

This sounds confrontational and it is. Terengganu must confront Petronas. In fact, it should declare war on Petronas and whoever else cooperates with Petronas. Whether they are car owners or petrol station owners they should be treated like the enemy if they cooperate with Petronas.

Terengganu stands to lose about RM4 billion by the next general election. This is no paltry sum and the state should fight tooth and nail to get the money back. The state should also not be afraid to spend a bit of money in employing guards to enforce the statewide boycott on Petronas stations and the blockade on the oil refinery.

Petronas must be made to lose money for the money Terengganu State is losing - an eye for an eye and a tooth for a tooth.

Promote it at a National issue and not just a State issue

Terengganu State must see its fight with Petronas as a National battle. The state must remember that Petronas has earned a total of about RM300 billion from Terengganu since it started its operation around 25 years ago (double that now). However, it can account for only about 20% of that money.

Since under the Petroleum Development Act 1974 it says Petronas is only answerable to the Prime Minister and takes direction from the Prime Minister only, this means only the Prime Minister, and no one else, knows what happened to all that money.

The opposition Parliamentarians have been trying for years to get Petronas to reveal its accounts but it refuses to do so, saying that they need only show the accounts to the Prime Minister and to no one else. Not even Parliament has the power to direct Petronas – and to think Petronas was set up through Act of Parliament.

Petronas needs to be “stripped naked” so that Malaysians can see where all their money has gone. We are talking about hundreds of billions here. Malaysians need to know where Mahathir has stashed all this money.

Rally “People’s Power”

The State should not confine its fight to a handful of people. Get the rakyat involved. The rakyat are waiting for directions from the top.

On 25 November 2000, Dr Hatta Ramli, the political secretary to Dato Ustaz Fadzil Noor, the President of PAS, handed a Memorandum to Tun Daim protesting the withdrawal of the oil royalty. A crowd of at least 5,000 people escorted him there. Dr Hatta then announced that if the Federal government ignores this Memorandum, he would get one million people to take to the streets.

Well, the government has ignored the Memorandum. Where are the one million people? Dr Hatta should carry through his promise – or was it just a threat? He should mobilise these one million people - and I know he can if he puts his mind to it. In fact, if you can get one million people onto the streets, not only would Petronas buckle but Mahathir himself will also fall. This will be Malaysia’s equivalent of People’s Power.

Form a human barricade

There are about 3 million people in the East Coast. You don’t need all these three million but a mere percentage of them. Call the people out. Get them onto the streets. And ask them to form a human barricade and block all Petronas installations in the East Coast.

People will not be able to get in or out. All economic activities will grind to a halt. Even Mahathir’s police will be powerless. Petronas will have to either reinstate Terengganu’s oil royalty or close down.

If Terengganu cannot get the money that is rightfully theirs then let no one else get it either.

FOOTNOTE:

The Petroleum Development Act (Act 144) 1974

This Act covers the exploration and exploitation of petroleum, whether onshore or offshore, by a corporation in which will be vested the entire ownership in, and the exclusive rights, powers, liberties, and privileges in respect of the said petroleum, and to control the carrying on of downstream activities and development relating to petroleum and its products.

Important clauses in this Act are:

1. A Corporation would be set up for this purpose under the Companies Act to be called Petroleum Nasional Berhad or PETRONAS for short.

2. The Corporation shall be subject to the control and direction of the Prime Minister who may, from time to time, issue such direction as he may deem fit.

3. The direction so issued by the Prime Minister shall be binding on the Corporation.

4. In return for the ownership and rights, powers, liberties and privileges vested in it by virtue of this Act, the Corporation shall make to the government of the Federation and the government of any relevant State such cash payments as may be agreed between the parties concerned.

Malaysia's war of words over God

Malaysia's war of words over God

Thursday, 21 January 2010
(Guardian, UK) In countless tourism adverts, Malaysia asks the world to see it as "Truly Asia". In the past days and weeks, its government's bid to portray the nation as a harmonious multicultural society has gone up in flames.

Since its high court lifted a three-year embargo that prevents non-Muslims from using the Arabic word Allah in their prayers and literature on 31 December, detractors firebombed several churches and vandalised others across the nation. While there were no casualties, several churches have thus far been hit, with one so severely damaged that its members had to conduct their service elsewhere. Eight of the attackers have now been arrested.

Despite these attacks, Malaysia's Christians, who make up about nine percent of the 27 million-strong Southeast Asian nation, are insisting that the use of Allah is not exclusive to Muslims, who account for some 60% of the population.

Last February, Malaysia's Catholic archbishop, Murphy Pakiam, publisher of the Herald newspaper, filed for a judicial review against the ban that was first enforced in 2007 by the then home affairs minister, Syed Hamid Albar, against the Catholic weekly for using Allah to refer to God in its Malay language version.

The rationale behind the Catholic church's appeal was that Allah is a generic word for God that preceded the spread of Islam. After all, the word Allah, when translated from Arabic, comprises the definite article al, and the noun ilah which means God – connoting a singular deity, a belief common to adherents of the Abrahamic faiths.

Indeed, Biblical scholar Kenneth J Thomas outlined evidence in a 2001 research paper (pdf) suggesting that Jews, Christians and Muslims in the Arab world have used Allah when citing and translating the Bible since the first centuries of Islam.

In Malaysia, its use by Christians developed along similar lines. Since Christianity became widespread there in the 19th century, primarily through the missionary efforts of English colonisers, Allah has been used extensively by Malay-speaking Christian indigenous peoples of the Malaysian states of Sabah and Sarawak.

When juxtaposed against the fact that Malay-speaking Christians in neighbouring Indonesia have long used Allah in their worship to no complaint, it is understandable that Malaysia's church attacks have been viewed with much chagrin.

Observers have rightly argued that the rumpus is tied to Malaysia's ethnic-based political landscape. To be more precise, it arises from the form of Islam nurtured by a segment of the nation's Malay political elites.

The country's constitution not only makes Islam the official state religion but also specifies that a "Malay" must be a "Muslim". With ethnicity tied so closely to religion, defending the purity of Islam against corruption by foreigners has become both a religious duty and a matter of national pride.

This dogma has been fostered by the nation's ruling party, the United Malays National Organisation (Umno), whose popularity is partly derived from its status as a defender of Malay rights.

This would explain Umno's ambivalent stance on the issue. Even as prime minister Najib Razak decried the church attacks as heinous, his Umno colleagues in government had filed an appeal against the high court decision to overturn the Allah ban. Home affairs minister Hishamuddin Hussein even went as far as to allow demonstrations against the Allah ruling in mosques across Malaysia after Friday prayers on 8 January.

Christians were not the only group targeted by adherents of exclusivist Islam following the fallout from the ruling. On 13 January, the country's Sikhs became the latest to suffer attacks when vandals threw stones at a temple in the Malaysian capital Kuala Lumpur. The Sikhs, who number approximately 120,000, also use Allah to refer to God in their worship.

Even the Hindus are not exempt from this kind of discrimination. Last September, a group of Muslim protestors stamped on a cow's severed head to protest at the building of a Hindu temple in a Muslim-majority neighbourhood.

Yet there is some encouragement to be had in the fact that not all Malays subscribe to this form of exclusivist Islam. Respected Muslim scholar Asri Zainul Abidin, a former state mufti, backs the use of Allah by non-Muslims. Surprisingly, this is the same stance taken by the opposition Islamic party, Parti Islam SeMalaysia, which had advocated the full-blown implementation of Sharia laws in past campaigns.

There are even voices of dissent coming from within Umno itself. Veteran politician Tengku Razaleigh Hamzah, who has always been something of a maverick, condemned his party's reactions following the ruling. For Malaysians to stop warring in God's name, this emerging inclusive Malay-Muslim voice must drown out the rallying cries of the divisive vandals. Insha'Allah.

Ku Li: BN has destroyed Malaysia’s future

Ku Li: BN has destroyed Malaysia’s future

Sat, Dec 12, 2009

KUALA LUMPUR: Tengku Razaleigh Hamzah (picture) today painted a bleak future for Malaysia under the Barisan Nasional government, saying it had squandered the nation’s oil wealth to the tune of billions of ringgit.

The former Finance Minister said Petronas’s oil profits had been used “to bail out failing companies, buy arms, build grandiose cities amidst cleared palm oil estates.”

“Instead of helping eradicate poverty in the poorest states, our oil wealth came to be channeled into our political and politically-linked class,” the first Petronas chief and former Umno vice president said in a speech at the Young Corporate Malaysians Summit.

He said Petronas money had been used as a slush fund to prop up authoritarian rule, to corrupt the entire political and business elite and to erode constitutional democracy.

The Gua Musang MP told the conference that Petronas had contributed 40 percent to the national budget over the years.

But such a great reliance on oil income was getting untenable, he said. “The oil that was meant to spur our transition to a more humane, educated society has instead become a narcotic that provides economic quick fixes and hollow symbols such as the Petronas Towers.”

He said the future for Malaysians looks bleak with the government seeking to broaden the tax base by introducing a goods and services tax (GST), requiring Malaysians to pay an additional tax on top of income tax.

Malaysia is now caught in a middle-income trap, stuck in the pattern of easy growth from low-value-added manufacturing and component assembly and unable to make the leap to a knowledge-intensive economy, Tengku Razaleigh added.

Following is the text of his speech:

In a speech I made in April this year, I spoke of where we stand in our developmental path and what I felt we must do to move forward.

I need to revisit that argument in order to develop it further.
We are stagnating. The signs of a low-growth economy are all around us. Wages are stagnant and the cost of living is rising.

We have not made much progress in becoming a knowledge and services based economy.

According to the World Bank, Malaysia’s share of GDP contributed by services was 46.2 percent in 1987. Ten years later, that share had grown by a mere 0.2 percent.

Between 1994 and 2007, real wages grew by 2.6 percent in the domestic sector and by 2.8 percent in the export sector, which is to say, they were flat over that 13-year period.

Meanwhile, our talent scenario is an example of perverse selection at its most ruinous. We are failing to retain our own young talent, people like yourselves, let alone attract international talent to relocate here, while we have had a massive influx of unskilled foreign labour. They now make up 30 to 40 percent of our workforce.

Alone in East Asia, the number of expatriate professionals here has decreased. Alone in East Asia, private sector wage increases follow government sector increases, instead of the other way around. We are losing doctors and scientists and have become Southeast Asia’s haven for low-cost labour.

I said that we are in a middle-income trap, stuck in the pattern of easy growth from low-value-added manufacturing and component assembly and unable to make the leap to a knowledge-intensive economy.

Regional competitors with larger, cheaper – and dare I say – hungrier labour forces have emerged. China and India have risen as both lower cost and higher technology producers, and with giant domestic markets.

The manufacturing sector which propelled the growth we enjoyed in the 90s is being hollowed out. There is no going back, there is no staying where we are, and we do not have a map for the way forward.

I am glad that the characterisation of Malaysia as being in a ‘middle-income-trap’ has been taken up by the government, and that the need for an economic story, or strategy, for Malaysia is now recognised.

We stand in particular need of such a model because we are a smallish economy. We cannot be good at everything, and we don’t have to be.

We need only make some reasonable bets in identifying and developing a focused set of growth drivers. It is not difficult to see what the elements of such a growth strategy might be. Whatever we come up with should build on our natural strengths, and our strengths include the following:

+ We are located at the crossroads of Asia, geographically and culturally, sitting alongside the most important oil route in the world.

+ We have large Muslim, Chinese and Indian populations that connect us to the three fastest growing places in the world today.

+ We have some of the largest and oldest rainforests in the world, a treasure house of bio-diversity when the greatest threat facing mankind as a whole now is ecological destruction, and the greatest technological advances are likely to come from bioscience.

+ We have the English language, a common law system, parliamentary democracy, good schools, an independent civil service and good infrastructure.

These advantages, however, are declining. Our cultural diversity is in danger of coming apart in bigotry, our rainforests are being logged out and planted over, our social and political institutions are decaying. I have spoken at length on different occasions about the causes and consequences of institutional decline. The decline in our society, and indeed in our natural environment, originates in a decline in our basic institutions.

The link between these is corruption. The destruction of our ecosystem, for example, is made possible by corrupt officials and business people. The uncontrolled influx of unskilled labour is a direct result of corruption.

These are problems we need to be aware of before we speak glibly about coming up with new strategies and new economic models. We need to understand where we are, and how we have gone wrong, before we can set things right.

You are young, well-educated Malaysians. Many among you have left for other shores. Record numbers of Malaysians, of all races, work abroad or have emigrated. Among these are some of our best people. They sense the stagnation I described.

There is a certain lack of energy, ingenuity and “hunger” in the climate of this country that young people are most sensitive to. In the globalised job market, young people instinctively leave the less simulating and creative environments for those that have a spark to them.

How did we lose our spark as a nation?

We have a political economy marked by dependence on easy options and easy wealth. Like personal dependencies, these bad habits provide temporary comfort but discourage the growth of creativity and resilience.

I mentioned our dependence on low-cost foreign labour.

The other dependence is something I played a part in making possible. This is a story I want to leave with you to ponder in your deliberations today.

Our nation is blessed with a modest quantity of oil reserves. As a young nation coming to terms with this natural bounty in the early 70s, our primary thought was to conserve that oil.

That is why, when Petronas was formed, we instituted the Petroleum Development Council. Its function was to advise the prime minister on how to conserve that oil and use it judiciously for national development. We knew our reserves would not last long.

We saw our oil reserves as an unearned bounty that would provide the money for modernisation and technology. We saw our oil within a developmental perspective. Our struggle then was to make the leap from an economy based on commodities and low-cost assembly and manufacturing to a more diverse economy based on high income jobs.

Aware that we had an insufficient tax base to make the capital investments needed to make the leap, we planned to apply oil royalties to what you would call today strategic investments in human capital.

Whatever money left after making cash payments, allocations for development funds, etc, was to be placed in a Heritage Fund for the future. The Heritage Fund was for education and social enrichment.

In working out the distribution of oil between the states, who had sovereign rights over it, and the federal government, we were guided by concerns for equity between all Malaysians, a concern to develop the poorer states (who also happened to be the oil rich states) and a concern for inter-generational equity. That oil was for special development purposes and it was not just meant for our generation.

Sabah and Sarawak joined Malaya to form Malaysia because of the promise of development funds. Yet today, despite their massive resources, they are some of our poorest states.

Instead of being our ace up the sleeve, however, our oil wealth became in effect a swag of money used to fund the government’s operational expenditure, to bail out failing companies, buy arms, build grandiose cities amidst cleared palm oil estates.

Instead of helping eradicate poverty in the poorest states, our oil wealth came to be channeled into the overseas bank accounts of our political and politically-linked class.

Instead of being the patrimony of all Malaysians, and for our children, it is used as a giant slush fund that has propped up authoritarian rule, eroded constitutional democracy and corrupted our entire political and business elite.

Our oil receipts, instead of being applied in the manner we planned upon the formation of Petronas, that is, according to its original developmental purpose, became a fund for the whims and fancy of whoever ran the country, without any accountability.

The oil that was meant to spur our transition to a more humane, educated society has instead become a narcotic that provides economic quick fixes and hollow symbols such as the Petronas towers.

Our oil wealth was meant to help us foster Malaysians capable of building the Twin Towers than hire foreigners to build them, a practice in which we preceded Dubai. I would rather have good government than grand government buildings filled with a demoralised civil service.

It is no wonder that we are no longer productive, no longer using our ingenuity to devise ways to improve ourselves and leap forward.

Malaysia is now an “oil cursed” country. We managed to arrive at this despite not having a lot of oil.

When I started Petronas in 1974, I did not realise I would see the day when I would wish we had not uncovered this bounty.

The story I have told is a reminder of the scale of the challenge of development. My generation of young people faced this challenge in the 60s and 70s. You face it now. The story tells us that development is about far more than picking strategies out of a box.

You have kindly invited me to address a seminar on strategies for reinventing and liberalising Malaysia’s economy. But the story of our squandered oil wealth reminds us that it was not for want of resources or strategies that we floundered.

Our failure has been political and moral. We have allowed greed and resentment to drive our politics and looked the other way or even gone along while public assets have been stolen in broad daylight.

I encourage you to take up the cause of national development with the ingenuity that earlier generations of Malaysians brought to this task, but the beginning of our journey must be a return to the basics of public life: the rule of law, honesty, truth-telling and the keeping of promises.

The Malaysia we need to recover is one that was founded on laws and led with integrity. With the hindsight of history we know such things are fragile and can be overturned in one generation, forgotten the next.

Without a living foundation in the basics, you might sense an air of unreality around our talk of reinventing ourselves, coming up with “a new economic model” and liberalising our economy.

So before we can reinvent ourselves, we need to reclaim our nation. That larger community, bound by laws, democratic and constitutional, is the context of economic progress, it is the context in which young people find hope, think generous thoughts and create tomorrow.

Link to the article:

Ku Li: BN has destroyed Malaysia’s future

Ku Li speaks of Malaysia as cursed by oil

Ku Li speaks of Malaysia as cursed by oil

Tengku Razaleigh says the country has squandered its oil wealth. — File pic

KUALA LUMPUR, Dec 12 — Petronas founder and former Finance Minister Tengku Razaleigh Hamzah said today that Malaysia had squandered its oil wealth and had become an “oil cursed” country dependent on it like a narcotic for quick fixes.

In his most scathing remarks yet about the management of the country's oil reserves and the economy, Tengku Razaleigh said oil money had been used as "a giant slush fund that has propped up authoritarian rule, eroded constitutional democracy and corrupted our entire political and business elite."

"Our oil receipts, instead of being applied in the manner we planned upon the formation of Petronas, that is, according to its original developmental purpose, became a fund for the whims and fancy of whoever ran the country, without any accountability.

"The oil that was meant to spur our transition to a more humane, educated society has instead become a narcotic that provides economic quick fixes and hollow symbols such as the Petronas Towers. Our oil wealth was meant to help us foster Malaysians capable of building the Twin Towers than hire foreigners to build them, a practice in which we preceded Dubai. I would rather have good government than grand government buildings filled with a demoralised civil service," he said in his speech at the Young Corporate Malaysians Summit here today.

He said that when he started the national oil company in 1974, he did not foresee that he would one day wish that the country had not discovered oil.

The Umno veteran said that Malaysians were no longer productive and no longer used their ingenuity to improve themselves to take the leap forward.

This he blamed on the mismanagement and abuse of the country's oil reserves.

"Our nation is blessed with a modest quantity of oil reserves. As a young nation coming to terms with this natural bounty in the early 1970s, our primary thought was to conserve that oil. That is why, when Petronas was formed, we instituted the Petroleum Development Council. Its function was to advise the PM on how to conserve that oil and use it judicially for national development. We knew our reserves would not last long.

"We saw our oil reserves as an unearned bounty that would provide the money for modernisation and technology. We saw our oil within a developmental perspective. Our struggle then, was to make the leap from an economy based on commodities and low-cost assembly and manufacture to a more diverse, economy based on high-income jobs."

He said the government then had planned to apply oil royalties to strategic investments in human capital.

The government, he said, was to have used whatever money was left after making cash payments and allocations for development funds, and place it in a Heritage Fund for the future. The Heritage Fund was for education and social enrichment.

"Instead of being our ace up the sleeve, however, our oil wealth became in effect a swag of money used to fund the government’s operational expenditure, to bail out failing companies, buy arms, build grandiose cities amidst cleared oil palm estates. Instead of helping eradicate poverty in the poorest states, our oil wealth came to be channelled into the overseas bank accounts of our political and politically-linked class. Instead of being the patrimony of all Malaysians, and for our children, it is used as a giant slush fund that has propped up authoritarian rule, eroded constitutional democracy and corrupted our entire political and business elite.

"Malaysia is now an ‘oil cursed’ country. We managed to arrive at this despite not having a lot of oil.”

Tengku Razaleigh said that his generation's failure had been both "political and moral."

"We have allowed greed and resentment to drive our politics and looked the other way or even gone along while public assets have been stolen in broad daylight.

"I encourage you to take up the cause of national development with the ingenuity that earlier generations of Malaysians brought to this task, but the beginning of our journey must be a return to the basics of public life: the rule of law, honesty, truth-telling and the keeping of promises," he told the young corporate leaders in his speech.

“So before we can reinvent ourselves we need to recover our nation. That larger community, bound by laws, democratic and constitutional, is the context of economic progress, it is the context in which young people find hope, think generous thoughts and create tomorrow."