5-Year Plans: Are They Crony Enrichment Programmes?

Dennis Ignatius believes the 5-year spending plans are crony enrichment programmes. Since 1971 there has been over twelve 5-year plans, 50 national budgets and 9 PMs. Over 94 Bumiputera empowerment agencies were created and an estimated RM1 trillion poured into the Bumiputera agenda with mediocre results!

The present PM says Bumiputera corporate equity is just 17.2% as opposed to a target of 30%. In 1991, it was over 20%. In 2009, this was 19.4% and in 2011 it was 23.4%. So is this economic cycle or for some other reason?

Source: https://opengovasia.com

First, the shares (corporate equity) are measured on “par” not on mark-to-market. So its value is always “suppressed”. Second, the allocated shares are invariably sold by the cronies who receive it. Then they queue for more shares or new allocations. And it is generally the same people not the B40. Third, the value of GLCs and GLICs are not included because they are so-called national entities. For all intents and purposes, they are Bumiputera-run and report to MoF or Economic Affairs Ministry. Board and Management are all Bumiputera. So, by definition (of Companies Act) they should be classified as Bumiputera interests. If you do that then overall corporate equity of Bumiputeras will exceed 60% (that’s my estimate, apologise for any error).

If you follow the UMNO way, the NEP targets will never be met. That’s the political game. But surely it is also a double-edged sword – the failure of near 50 years (since NEP) of UMNO rule! The ordinary folks are coming to realise this but has UMNO caught on? Or, is the DAP responsible for this?

Can someone explain how a nation with a population of 5.8 million has a GDP of USD379 billion (or USD618 billion on PPP terms) while we have a population of 32 million and GDP of only USD387 billion (or USD979 billion in PPP terms)? Malaysia is blessed with all the resources – petroleum, land, oil-palm, rubber etc. – and the tiny island of Singapore lives of services, manufacturing and trade. By Singapore’s standards, our GDP should be 5x higher! Wastage, corruption, leakages and endemic apathy leaves us as “mediocre” Malaysia.

The latest 5-year plan has RM400 billion to be spent! Of this, 30% or RM120 billion will be lost through wastage and corruption. That’s the estimate of Transparency International (not mine).

Whatever happened to RM300 million paid for six helicopters not delivered? And then we have six “phantom” warships worth RM6 billion (still not delivered)? Over RM1billion of this sum cannot be traced. That’s according to Putrajaya’s special investigation committee on procurement, governance and finance. When can we stop this?

Unless there is serious effort on every level to curb excesses, five- year plans will remain an academic exercise for the benefit of cronies.  

References:

Malaysia’s crony enrichment plan, Dennis Ignatius (www.asiasentinel.com)

Hishammuddin’s RM6 billion phantom warships (www.sarawakreport.org)

Report: RM300m paid for US-made helicopters that were never delivered, 20 May 2019 (www.theedgemarkets.com)