Sunday, July 4, 2010

The Nouveau Riche of Malaysia

It's no secret that most of the richest people in South East Asia whose names are listed in the Forbe's List are Chinese with Ananda Krisnan representing the Indian. They are all business tycoons as are the other billionaires of the world, representing leaders in their own individual field of business with their own legendary style of making their fortune.

Enough has been written about them in the Papers and Magazines. What i would like to focus on are the nouveau riche among the Malays. A number of them, without mentioning names, are also business tycoons and timber merchants, especially from Sabah and Sarawak. But they are few and far between. Who are the others whose living style and luxurious homes easily point them out as one of Malaysian's new Bumiputra millionaires? No doubt there are some businessmen too. But otherwise they are current or ex-'Yang Berhormat' or corporate leaders. The most visible transformation from 'rags' ( not necessarily very poor but very much of kampung standard) to 'riches' ( not necesairly millionaires but with country homes and a fleet of BMWs and Mercs) are found among the former group, and they exist at all levels ie. Federal, State and Local. You can easily meet a friend in the village who was once a humble teacher or even a carpenter, who is now a YB, and moving around in a chauffeur driven Merc or BMW.

This is indeed a magnificent example of social mobility that Malaysia has achieved it its 52 years of Independence. It's a sign of achievement we should all be very proud of, although there's a tendency among the Malays to give such achievement 'the sour grape look'. We shouldn't be bothered about that for all good Muslims believe that worldly endowment or 'rezki' comes from Allah, and He gives it to whomsoever He wants. And that 'rezki' did not come by itself but had to be earned.

What should be given some thoughts to is the fact that more of the new rich seem to come from the political ranks rather than the business hierarchy. This fact itself must be statistically proven or disproved, but that seems to be the situation as of today.
If true than the political business is producing more successful entrepreneurs than the trades and economic enterprises. Is that wrong? Maybe not but the consequences could be very undesirable. Let's give it some deep thoughts.

In the first instance the Bumiputras will be more interested in the political business rather than the trade and economic enterprises which form the basis or real progress and development. The NEP in the past had tried to increase the number of Bumi entrepreneurs to achieve a balance in the occupational structure of the population. If the number and equity target faialed to be achieved could it not be due to the fact that the political business was more attractive in that it presents a shortcut to prosperity? Our leaders must give this a serious atention for the political business is easier to enter into than the real trade and economic business that our Chines and Indian friends have excelled in all these years.

Another undesirable consequence is that the political business being easier to enter into gets mixed up with the real trade and economic business. The first is used as a prop for the second and therefore the vicissitude of political progress and standing affects the latter. A company can go bust if the leader looses his political position and clout. We must take note that in the case of our Chinese and Indian friends. success in the trade and economic enterprise often comes first before they are chosen to become leaders in the political business.

As a result of the above the Bumiputra trade and business enterprises , even after reaching some level of corporate success, might not continue to prosper and might even begin to crumble when the political fortune of their leaders declines. And this can happen very often because of the effervescent nature of politics. I might add here that even the most successful of our national corporate bodies such as Petronas etc might ultimately suffer because of changes in leadership as required by the political business.

Finally, the long term goal of the nation to even up the participation of the Bumis in the business and corporate sector of the national economy, increase equity participation and reduce identification or race with occupation ( which should have been achieved through the NEP) in order to promote national unity, could be stultified by a greater interest among the Bumis to participate in the political business rather than in the trade and economic enterprises. Such tendency might be further enhanced by the fact that even getting some of the funds allocated for the promotion of Bumiputra business enterprise can become easier if you have some political pull. The situation is made worst if the political business partners themselves get more of the fund.

So, politics must start to become less of a business and more of a dignified profession if the Bumis are to be stopped from crowding into that concern and go into the real trade and economic enterprises. We must see more Bumiputra millionaires coming from the trade and economic business sector rather than from the Dewan Undangan Negeri and Parliament or from the Yang Berhormat group of businessmen. The line between businessmen and politco-businessmen must also be drawn to stop a business from going bust if a politician looses his power.

( Suggested Readings: Google Wealthy Politicians and read: 'Do not elect wealthy politicians' and Celebrity Politicians and Wealthy CEOs)


abdulhalimshah said...

Ya Akhi Norzah,
Your posting is very timely because we are going to see the divisional meetings of UMNO gathering momentum soon. The sights are being set for the next GE, and the front liners are getting ready for battle. The obsession of Political manouvres by our society is only found in third world nations where political lobbying is the passport to future riches.

Since political campaigns are rendered impossible without money, so the term "Money Politics" was coined in lieu of corruption. It is due to the thin line of separation between power politics and the abuse of position in order to have an easy access to amassing wealth without having to work hard and take risks that have turned Politics into a lucrative business.
When the late Tunku said that he would sink and swim with MCA it was because the rich towkays in MCA were the source of funds to undertake the election campaign for the Alliance before BN was formed. It was this state of affairs that led to UMNO being involved to the hilt in business that blurred the line between politics and business. The political opportunists found this easy way out to become millionaires and thus jockeyed for positions in the party because it guarantees the access to riches in a flash. When it is obvious to all that the culture of buying votes even to get elected to party posts, then all hell broke loose.
The political leaders who tried hard to stem this undesirable trend were almost drowned and the greed for virtual easy wealth became the norm. The highly politicised Malays completely abandoned the virtues of honesty and integrity and the fear of God and allowed greed and Nafs to overwhelm them. Encouraged by the leadership who promoted the idea that Malay millionaires will have a multiplier effect by giving every help to others to become millionaires, all they talked about are the end justifies the means regardless whether our moral and ethical values are sacrificed or not in the race towards becoming the New Rich. The values imbibed upon Believers that only the rewards of hard work and honest
effort should be our target were thrown out of the window and our conscience were the least pricked. Opulent and lavish lifestyles were flaunted without shame even if people knew that one could not have achieved such wealth within the shortest time and without much effort but merely by political patronage did not bother them at all.
So your theory that most of them achieved riches and wealth through political avenues just by becoming rentiers and proxies for their masters is very much near to the truth. We do not need the McKinsey & Co to do the research at the price of several million ringgit Malaysia to find that out. It is axiomatic.

abdulhalimshah said...
This comment has been removed by the author.
norzah said...

There're so many bitter truths that you mentioned, Akhi, that I cannot attempt to summarize them. Things like "political lobbying is the passport to future riches..easy access to amassing wealth without having to work hard and take risks have turned politics into a lucrative business...the highly politicized Malays have completely abandoned the virtues of honesty and integrity...opulence and lavish life-style were flaunted without shame even when people knew.. the wealth was gained) through political patronage.." I could go on quoting you because you said it so well.

Yes, that seems to be the order of the day as far as
how many of the new rich Malays acquired their wealth. It;s a sickening thought but those in power don;t seem to bother for obvious reasons. Mind over matter, if the boss doesn't mind it doesn't matter. The Anti-corruption commission seems to be just unable to do anything much but catch the
powerless oddballs. Those with political cables can go scott free.

Let me stop there for now and hear more comments.

kaykuala said...

Akhi Norzah,
What constitutes a New Rich? One who rich 2. brought about by political connections 3.have a thriving business 4. favoured through government contracts and may we add 5. not involved directly in its day to day running, flaunt their riches , children overseas , multiple wives ( may include a starlet), or having children trying to woo a starlet.

It is a lumping together of different types, of differing backgrounds, from various locations and of all races all with unsatiable wants!

By a twist of fate, if the basic foundations of # 2 and #3 ( political connections and thriving business) were retracted from the equation or threatened through sudden change in market situations eg the 1997 crisis, then it would create or lead to other unwanted happenings.

We’ll then be entertained with their antics revolving around corruption, accusations, poison pen letters, legal suits, back-biting (or back stroking of a salesgirl) questionable forest concessions allocation and sand stealing! ( it includes those newly exposed to sudden opportunities in the Pakatan states)

What does this mean? It means that given half a chance anyone of them from both political divides and of any race would want to be the New Rich through whatever means.

Those who are successful are considered good as they create employment with multiplier effects on economic activities. Those who failed are the ones creating problems.

So long as there is a govt and there are rent seekers there’ll be the new rich according to various degrees of richness each outdoing the other for favours .

At any one time in the course of the countries’ development through the years, the game is the same, only the players are different.

norzah said...

Akhi Kaykuala, ver cogent observation. I've of course no qualms against those new rich who acquired their fortune through hard work and honest dealings especially in doing business. What piqued me are those flaunting their new found wealth because of the political power modern style election had given them, because of strong connections with those in power and using their position to channel wealth into their hands not necessarily through corruption but unfair manipulations. If more Malays become rich through politics and politicking, that becomes their main business and the true entrepreneurs and businessmen that we need to achieve occupational restructuring and the equity target will never appear. The country will be full of get-rich- quick Malay political opportunists.

abdulhalimshah said...

Akhi Norzah,
The Malay entrepreneurs who become extremely wealthy and rich solely from their own effort and hard work can be counted with your fingers. We have seen so many of the so-called Malays who became rich and wealthy through political patronage just fell by the wayside when the financial meltdown took place in the 80's and the 90's, and they never recovered. A few have been called to face their Creator.
I do agree with you that we should not envy those who made it on their own. But these as you had pointed out are very few. And normally they would keep a low profile. But those who joined the club of the Noveau Riche by their manipulations and political connections are those who flaunted their new found wealth and ill-gotten gains by their opulent lifestyle such as travelling in executive jets or helicopters and having a fleet of Rolls Royce and Bentleys in their garages.
One day when I was in Alor Star, this taxi driver who drove me to the mosque for friday prayers was lamenting on a certain politician from that State who is filthy rich but had not spent his riches in the path of ALLAH S.W.T. by building mosques or orphanages for needy children. Instead he was complimenting an ordinary businessman also from the same state who travelled by commercial airlines wherever he goes and even drive his own car or take a cab when the driver is unavailable had built Mosques and even a school for the underprivileged. Of course this businessman is now in one of the top twenty wealthiest man in Malaysia, but he succeeded on his own merit before he was accorded the right connections to be where he is today.

norzah said...

The hard working, honest businessmen are our pride, Akhir. They are the ones who can compete with the non-bumi tycoon. What worries me is that their number is so few because others take the short cut thru political petronage, becoming a YB etc. So most Malays are trying to emulate them, the real businessmen are all disheartened. Banyak kontrektor tanpa strong cable merungut tak dapat kerja. Banyak yang terus gulung tikar.

Al-Manar said...

Dear Norzah
I live with despair reading about the great number of schemes and mega projects on one hand, and on the other, the number of children born out wed-lock, the worsening number of Mat Rempit incidents, the dadah addiction, phonograph etc, mainly among the Malay community. Above all I am seeing what I see and what the many YB’s seem to see but not seeing. What is richness, material, mental, attitude, education, I wonder.

norzah said...

I feel compelled to respond to your brief but highly cogent remark, Pakcik. Yes it appears to be a great contradiction: all those mega projects, billions of ringgit allocated to this and that project, hundreds or even thousand of millionnaires, yet crimes, immorality, drugs, prostitution etc prevail. These are the contradicting forces that can one day tear the society down if the YBs don't see as what Pakcik sees and do something about them.