Sunday, October 23, 2005

Life is short.

Nothing jolt us from the torpor of daily life than death of someone close to us.
On Thursday, Datin Endon Mahmood wife of PM died of cancer. Then on the same morning, Hj Mat Mazlan Abu, a friend I knew from college days died in a road accident in KL. I havent met him close to 20 years, only the occasional email. In case of PM's wife, I have never met her at all, but inside me, my sorrow goes out for their close relatives. I remember what my friend like when we were young, the games we layed and how he loves playing soccer and cricket.
At times like these we take stock of our lives, not measuring what we have done, but realising that we havent done enough of of our obligations - to Allah, ourselves, family and people around us.
Allah sends us to this world to do a job - that is to worship Him. Act of worship is not just prayer, fast, hajj and zakat, but also to do good deeds towards our fellow residents of this world.
Everyone has their own way to do good deeds, and everyone should contribute for the benefit of mankind and the world.

Saturday, October 22, 2005

Bird Flu Effect

Economists say a bird flu outbreak would create an instant and potentially prolonged recession. Bank of New Zealand chief economist Tony Alexander says the economic impact will depend on the virulence of the virus - if it emerges. He says it will also come down to how long it takes to get people around the world vaccinated. Tony Alexander says our biggest export earner, the tourism sector, would take a big hit and adds the general decline in consumer and business confidence would cause a significant downturn. He suggests businesses should prepare as best they can by making sure staff are aware of the risks and are practicing good hygiene. He says the hit would be so great it would shut everything down for a while.

If this bird flu materialise, and kills millions of us, world economy would be in tatters. Prices would fall, triggering deep recession. Suddenly we would be short of manpower to run everything and anything. Farms would turn back to forest in 10-20 years time, and we would lose all the gains in development for the past decade or more.

Thursday, October 20, 2005


Mat Mazlan Abu, ahli Exco Pemuda UMNO meninggal dunia dalam satu kemalangan jalanraya ketika dalam perjalanan ke Putrajaya untuk menziarahi arwah isteri Perdana Menteri.
Marilah kita sama sama menghadiahkan AlFatihah dan mendoakan semoga Allahyarham termasuk dalam golongan orang orang yang beriman.


Isteri Perdana Menteri Malaysia, Datin Endon Mahmood meninggal dunia pagi ini di rumahnya di Putrajaya.
Marilah kita menghadiahkan AlFatihah dan mendoakan semoga rohnya di terima Tuhan dan dimasukkan dalam golongan orang orang yang beriman.

Tuesday, October 18, 2005

From New Zealand with love.

The Election Winner is…Winston Peters.
On the election night, Labour just holds 50 seats compared to National’s 49. Special votes counted 4 weeks later; the verdict is 50-48. Another few weeks of political courting to form a coalition government, Green does not have enough number to hold sway, so Labour has to court Winston Peters and Peter Dunne.
The result, Winston Peters got 3 ministries including Foreign Ministry; Peter Dunne gets the Revenue Ministry and the Green only get policy concessions on some issues. Winston Peters influence in Immigration issues will undoubtedly change future intake of new migrants into the country and his fiscal policy would cost estimated extra $300millions. I have no grumble against his stated policies; 1000 extra police, better care for senior citizens in the form of 1 percent increase from 65 to 66 percent of average wage living allowance and increase minimum wage to $12 per hour. Given the country’s high MPC (marginal propensity of consumption) rate, this will aggravate the inflationary pressure somewhat, although not as bad as National tax cut. Remember, Labour’s election bribe is not as inflationary as National by the virtue of lower income targeting. The outlook is still higher interest rate in the future, and further reduction in unemployment to record lows. Labour’s election bribe includes increases in family support, which will give better lifestyle to families and option of homemaking full time. People would be working less hours, more time for leisure. Interest free student loan will only encourage more youth and adult to tertiary studies, simultaneously reducing available low wage pool of labour and upskilling them. Not a bad path to a high wage economy.
The negative outlook in the future is the property sector. With the number of new migrant dried up, (what else do we expect when Winston is in charge of Immigration?) and interest rate inching higher and new dwellings coming on stream by the thousands, it is likely that house prices would consolidate and may even come down a bit.
Alan Bollard, the Reserve Bank Governor gave severe warning a few days ago that the exchange rate is at unsustainable levels and New Zealanders spend $112 for every $100 they earn. This is a clear indication that he will increase interest rate. High interest rate and high fuel prices will crimp the expanding economy.
Maybe New Zealanders will change their habit of investing in unproductive housing real estate into productive businesses – farming, manufacturing and services.

Sunday, October 16, 2005

Globalizing our carmakers.

As the debate about the status of our national carmaker rages on, I believe that we missed the point that there are other carmakers beside Proton and Perodua in Malaysia. These companies have their manufacturing facilities with high content locally made components Volvo, Nissan, Honda and Hyundai have facilities in Malaysia, and they produce cars with high local contents. While Tun Mahathir question the merit of Naza as national car and Datuk Shahrir urged the reduction of minimum local content to 40% for national cars, I believe that we should free these carmakers from such constraints, be it 40% or 90%. We should let these carmakers make their own decision on where to buy their components, be it local or from other countries.
Restriction in local content will slow adoption of new technologies and render these carmakers uncompetitive in the long run. The last thing we want is that Proton or Perodua produce cars that is 2-3 years behind its competitors. Being able to outsource their component might give these carmakers its competitive advantage, reducing costs and able to pass on the savings to customers in the form of competitive pricing and good quality. Local components manufacturers have already produce high quality products, and by opening the market, they will have to market their capability to other global car manufacturers. More investment would be ploughed into component manufacturing to keep up with the competition.
These days most global car brands outsource their component from wherever the price and quality is advantageous. Some Honda brands are made in USA and Europe, while more Toyota components are made in Thailand. Recently Toyota made an agreement to buy electric motors for hybrid cars from Hitachi. These example shows that the concept of national car and local content is out of date. Let’s invest in Proton, Perodua, Volvo, Hyundai, Naza-Kia local manufacturers’ shares and let their management maximize the companies’ values. Who knows one of these days, our local car brand could become global brand.

Monday, October 10, 2005

Panduan Menghayati Puasa

Tulisan Mohd Fazel Mohd Salleh
Kita telah berpuasa sekian lama. Namun, tiap kali kita berpuasa apakah nilaian puasa kita di sisi Tuhan? Semakin baikkah akhlak dan peribadi kita? Atau sama sahaja seperti sebelum-sebelumnya. Tujuan ibadah bagi hamba-hamba Tuhan adalah agar hamba itu mengenali Tuhan seterusnya benar-benar merasakan kebesaran dan keagungan Tuhan. Selain ibadah itu dapat memberi kesan kepada seseorang agar orang itu benar-benar menghayati dirinya sebagai hamba Tuhan. Oleh itu, puasa yang tidak memberi kesan kepada peribadi seseorang adalah ibadah yang sia-sia. Kalaulah hendak diibaratkan ibadah itu sebatang pokok, maka ia adalah pokok yang kegersangan buahnya. Dalam erti kata lain, pokok yang tidak mendatangkan hasil. Orang yang berpuasa tetapi tidak menghayati puasa, adalah orang yang lahirnya berpuasa tetapi batinnya tidak berpuasa. Sedangkan ibadah puasa itu ia ada lahir dan ada batinnya. Tidak boleh berpuasa sekadar lahir sahaja. Sekadar lapar dan dahaga sahaja. Sekadar tak makan dan tak minum. Tidak boleh begitu. Sedangkan yang Tuhan hendak lihat, yang dalam itu. Apa yang ada dalam hati kita. Sejauhmana penghayatan hati kita di waktu berpuasa. Yang lahir ini kena buat juga kerana ia menentukan sah batal puasa. Perlu juga. Tetapi yang dalam itulah yang terpenting sebab ia menentukan soal hubungan kita dengan Tuhan. Ia menentukan nilaian ibadah kita di sisi Tuhan. Diterima atau tidak di sisi Tuhan, banyak bergantung kepada penghayatan seseorang dalam berpuasa. Tidak boleh tidak, kenalah berpuasa dengan penghayatan. Bukan sekadar biasa sahaja seperti mana yang kita lakukan sebelum ini. Kenalah menghayati puasa itu kerana ia adalah pakej menyucikan fitrah kita yang Tuhan datangkan 1 bulan dalam 12 bulan. Bagaimana nak hayati puasa? Intipati puasa adalah mujahadah. Bila bermujahadah bersungguh-sungguh melawan nafsu, maka di situlah nanti ada penghayatan. Di samping mujahadah menahan lapar dan dahaga dalam berpuasa, apa yang dituntut adalah bersungguh-sungguh melawan nafsu terhadap keinginan-keinginan yang bertentangan dengan kehendak Tuhan. Sudah menjadi watak nafsu itu sendiri sangat sukakan kepada kejahatan. Nafsu tidak suka kepada perintah Tuhan. Apa yang Tuhan suruh buat, itulah yang dibencinya. Sebaliknya, apa yang Tuhan larang, menjadi kesukaannya. Kalau kita turut sahaja kata nafsu, kita sebenarnya sudah melawan Tuhan. Kita bukan jadi hamba Tuhan tetapi jadi hamba nafsu. Mahu tidak mahu, kenalah bermujahadah dengan nafsu. Tambahan daripada itu, lakukanlah berbagai pengisian roh di dalam bulan ini. Banyakkan bertafakur tentang kejadian ciptaan Tuhan. Usahakan memperbaiki solat agar benar-benar khusyuk. Bacalah Al-Quran dan fahamilah maksud daripadanya. Rasakanlah di dalam hati apa yang telah diceritakan oleh Tuhan di dalam Al-Quran itu. Solat terawih kerjakanlah ia sebanyak 20 rakaat dengan penuh rasa cinta kepada Tuhan. Moga-moga dengan panduan ini, kita akan menjadi orang yang bersih suci fitrahnya. Hanya orang yang sudah bersih suci fitrahnya sahaja yang layak mendapat hadiah Tuhan berupa keredhaanNya, keampunan, rahmat dan lepas dari azab neraka.#

Sunday, October 09, 2005

A.P. Tariff and Wealth Transfer

A couple of month ago, a friend bought a used Mercedes at a dealer. The car was imported from Japan and he has applied AP through MITI and got the necessary approval. So by the end of the year, he will be packing his Merc into a shipping container and wait for his car at a Malaysian port, pay the necessary custom duties before being able to drive it again on Malaysian road. The car cost him NZD13000 (about RM32500) and he estimated to pay about RM35000 in customs duties at port, making total cost about RM75000 after shipping. The estimated value of the same model car in Malaysia is about RM250000.
So his net worth will increase by RM175000 just like that!
Wealth creation? I doubt it.
Value and worth may go high or low depending on the scarcity and perceived value of the commodity, er, in this case a car.
A Mercedes brings along its prestige, history of reliability and perceived beauty, enhanced by the company’s investment in branding. If public perception changed, it is no longer viewed as desirable or ugly, and no one wants it, then the value might be worthless.
If we can import any car from any country we like, without having to pay any form of duties, would the value or price of car be as high? As an example, New Zealand has no tariff regime for imported cars, anyone can log on to internet, order and pay for a car in Japan, L.A or Bangkok, arrange for shipping to the nearest port. But to be able to drive it on NZ roads, the car must pass certain rules. As a result, car prices in NZ are relatively cheap. I bought a Mitsubishi Chariot 98 at an auction for NZD4000, about RM10000.
Any form of trade barrier; tariff, licensing, permit etc will only benefit those lucky few who has license or permit to import, or local producers protected by the trade barrier. The rest of the population - the have not, will have to pay higher prices and derive less benefit. To put it bluntly, this is a transfer of wealth from the unprivileged masses to the privileged few.
Why do I say so?
Lets take example from high car prices, as a result of these trade barriers. For a start, because the prices are higher (irrespective of the make, locally or imported), less number of people can afford to buy car – less economic benefit to the country. A deadweight loss. If the car were used as a taxi, the taxi charge would have to be higher, because the taxi driver has to pay for expensive car, as well as expensive taxi licence. This will go on for the rest of the economy, big companies, traders, farmers and producers, the small portion of expensive car and transportation cost will be passed on to the consumers. In the end, you and I, the ordinary blokes are paying to enrich the privileged few.
Much benefit will be accrued to the economy by removing trade barriers. For a start, car prices and other protected goods prices would start to fall. Our purchasing power would increase.
An analogy; if yesterday RM1 buy one bungkus of nasi lemak, and today the price of nasi lemak falls to RM0.90, then our purchasing power just increased 11%.
With lower prices of commodity and consumer goods, labour cost would also be relatively lower (workers wouldn’t have to demand higher wages) and we would become more efficient to be able to compete globally. There will be more wealth to be shared in the country, and creating wealth in the future. When people feel wealthy, they consume more and invest more. Keynesian cross shifts upwards, higher income and higher employment.
What about Proton, Perodua and other related car manufacturer and their suppliers? They will have to work harder for their profits, or shall I say they will have to earn their profits. When Malaysians become wealthier, they will demand better higher valued cars as well as expanding the market for cars. Instead of their share of car market shrinking, more Malaysians would be able to afford more cars, and buy new instead of second hand, expanding the market for car manufacturers. In the long term, if Proton and Perodua able to be competitive and efficient, they might be able to take on other global manufacturers.
When we are pressured to perform, we will improvise and perform. Look at those kids sitting PMR and any other exams, how could they study all night and all day?

Thursday, October 06, 2005


I am disappointed with our government latest budget. Nothing is done about our rampant inflation. In the budget statement, it says that the government will continue with its current monetary policy. Meaning Bank Negara will continue to print money to finance the deficit, which will result in continuing high inflation in the medium term. Our money will definitely worth less in the coming years, and the hard working Malaysians toiling in factories and estates will bear the brunt of higher prices.
More money is being ploughed into unfinished, public and agricultural projects will benefit us in the future, which are okay. Supply side measures will bear result in 2-3 years time, when those projects are finished. Those are medium term measures, but we must also do something about inflation now. Talking about it in the media is good and well, threatening to prosecute poor trader is not okay. If thoase traders cannot make a living because of marginal or no profit, they might close shop altogether. If you go to the market, you might notice that most of these traders are Malays.
What do you think would happen when most traders, farmers and producers close business?
We would have shortages of basic food and prices would increase. So in the long term, it is not good. Did we notice that the price of chicken is high lately? That because after the last bird flu scare 18 month ago, a large number of chicken farmers gone bankrupt because of low prices. Most of these bankrupt chicken farmers were Malays too. Now we bear the brunt of higher chicken prices.
I believe the government is fighting inflation at the wrong end. Instead of targeting small traders and businesses, we should be targeting medium and high income consumers. That group of people who have a lot of discretionary spending money to splash about. Increase taxes for medium and higher income earner, so that we can balance the budget. Another thing we must do is remove petrol and diesel subsidy, but provides help directly to the low income and the poor in the form of financial help. It is well documented that blanket subsidy system on petrol and diesel that we have missed the target group and benefit the rich. How much motorcycle riding factory worker spend on petrol every month compared to Mercedes driven company executive?
Yet the lower income groups are the ones moaning the loudest. That because higher percentage of their income goes to petrol. If we provide financial help to them directly, straight to their bank account, we would solve the problem.
I support measures announced before the budget in September, that we will increase financial help for the poor, those unable to work, single mothers and the needy.
A year ago I renew acquaintance with a school friend who is now a single mother supporting a number of school age children without any financial help from her former husband. She only gets RM350 a month from Jabatan Kebajikan Masyarakat. Sounds good? But the JKM paid her quarterly in arrears. Meaning the payment for January, February and March is paid in mid April. Yes we might want to give a message that the government has no money, but these people might starve waiting.
Meanwhile we devise another tax cut for the higher income group simply because they are our main supporter who voted for BN and hopefully will return us again to the parliament.
Much has been said about our wealth as a nation. Yet when taking care of the poor, we are far behind the developed nations, far less the utopia of Islam Hadhari. See our balance of payment; we have been in surplus continuously since early 1998 if I am not mistaken. Our foreign reserve has reached USD75billions, some of our multinational corporations are on acquisition trail in the region and worldwide, turning low yielding cash reserve into profitable investment and future revenue. Lately the government even encourages GLCs to invest more in the region in an effort to reduce foreign reserve, i.e. transforming foreign reserve into foreign investment.
Drive to any kampung and we are presented with modern bungalows with 3-4 cars in their yard. Yes, some of us did well, but look deeper, there are people in our midst who have difficulty coping with higher costs and surviving on low wages. I had the opportunity of meeting with the poor, those people who are paid a meager RM350 a month for her 8 hour a day, 6 days a week cleaning job. Why would she work for that amount of money? Because she is in a weak position, in a country with no legislated minimum wage, the weak is in no position to bargain about her wage, much less to demand higher salaries, her skills is easily replaceable with cheap imported foreign labour.
What about people who are unable to work? Those people who are incapacitated, sick or just simply too old, we would say we feel sorry for them, donate a few ringgits to atone our guilt, then we forget about them. Do we have a better way to take care of our poor, unfortunate citizens? Yes, from time to time we round up our beggars and drug addicts and house them in rehab, called Serenti. That’s about it.
We have the tendency to solve our problems by sweeping them under the carpet or tikar, and we forget about it. As long as we don’t see it, all is well and dandy.