Friday, October 03, 2008

Where is our direction (Malaysian) for our next generation?

For those who started work around 1973, a 1.3 litre Japaness car was RM 7000.

Today the equivalent is…… let's say RM 60000……8.5 times.

In 1973 a double storey house was about RM 45,000 or less.

Today it is about RM 300,000…… 6.6 times

In 1973 an Engineer's pay was RM 1000.
Today it is about RM 2000……2 times.

From 1973 to 2008…… 35 years…… what is the trend?

In a stock market when the trend is bearish, what do we do? Exit!

When a country's trend is bearish what do we do?
This Bearish trend is more difficult to turn around as compared to thestock market.

I have used these 3 items House, Car & Salary as a measurement of the country' s performance for the past 35 years. Foreigners also ask about these 3 items to gauge our standard of living.

There is a book I saw in MPH bookshop entitled:
Malaysia: The Failed Nation

Some of you may be interested to read it. I agreed with the writer.
This morning I was having Coffee at McDonald (100 %Arabica beans at RM 2.90, free refill). I asked how much per hour is their pay?

RM 3.00 x 8 hours = RM 24 per day x 25 days = RM 600 per month

My daughter works part-time during her University days. She worked atGloria Jeans Coffee……the pay? Australian $ 14.00 per hour ( @ 3.15 = RM 44 per hour.....x 8 = RM 352 per day !!! x 25 days = RM 8800.

13.3 times more! Price of houses in Perth is about the same in KL. Price of cars are about 23 % cheaper in Perth, Australia.

I think more and more people are becoming aware of this Bearish trend.

Developed country by 2020?...... means High income country.

Let's look at some as of year 2005 from Financial Times.

USA GNP per capita US$ 35400
UK GNP per capita US$ 25510
Australia GNP per capita US$ 19530
Singapore GNP per capita US $ 20690
These are developed countries by income measurement.

Malaysia GNP per capita US$ 3540

Year 2020…… developed country?Worrying trends, isn't it?
Ringgit Malaysia sliding further and further under BN.
-Gan Jul 8, 08 4:03pm

Recently, I interviewed some fresh graduates applying for jobs with myengineering company. I accepted two applicants on a starting salary ofRM 1,600. It struck me as odd that 15 years ago, I myself started workas a fresh graduate engineer for the same pay.

Indeed, if you compare the salaries of graduates now and 15 or even 20years ago, you'll find little difference but that their purchasingpower is vastly different. It's the same story when you comparesalaries of shop assistants, office staff, factory workers and others.

To compound the effect of inflation, the Ringgit has depreciatedgreatly against all major currencies. The real income of mostMalaysians has moved backwards.
This is why many Malaysians suffer under the petrol hike. The root ofthe problem is that our real incomes have shrunk in the face ofinflation and depreciated currency. Malaysians have not been spoiledby subsidy but are unable to move out of the time lock of stagnatedand depreciated incomes.

If you compare the per capita incomes of Singapore , Hong Kong , Taiwanand South Korea , they are a few multiples of ours although atindependence all these countries were the on the same economic level as Malaysia .

What has gone wrong? We were the rising star of East Asia, a countryrich in natural resources with the most promising potential.

The reason is massive corruption, plundering of resources, wastage offunds for huge non- economic projects, anti-public interest deals withpolitically-linked companies and passing-of-the-buck to the man inthe street.

Four decades of NEP where education, economic and employment policiesare defined by race ensured that meritocracy took a back seat.
Our university standard has declined and the today best and brightestof our youths emigrate to escape the racial inequality only tocontribute to the economies of foreign lands.

The reputation of our judiciary which was held in high esteemworldwide has sunk so low that foreign investors now insist onarbitration in Singapore in case of any dispute.

We also have a slew of oppressive laws such as the ISA, OSA, Uuca andPPPA which stifle free speech and are designed to keep the rulingparties in power.

We have become less attractive to foreign investors and now lag behindour neighbours in ASEAN for foreign direct investment. Even somecorporations who have established themselves here are moving out.

All the economic and social malaise cannot help but affect the valueof our currency. The strength of a country's currency is after all, areflection of its fundamentals.

Furthermore, Bank Negara has a policy of weak Ringgit to helpexporters, never mind the burden on the common folk. The government ispro-corporation, not pro-rakyat (citizens).

While the poor and middle-class are squeezed, an elite group getsbreathtakingly rich. We have the distinction of having the worseincome disparity in ASEAN. A re-distribution of wealth is under wayfrom the poor and middle-class to a select group ofpolitically-connected elite.

The end result of this re-distribution will be a small group ofsuper-rich while the majorities are pushed into poverty and themiddle-class shrinks. This is what happens when the rich gets richerand the poor get poorer.

There is much that is wrong with Malaysia. The responsibility forpulling the country backwards can be laid squarely at the door of theruling regime. It is BN's mis-governance, racial politics and cultureof patronage which has seen the country regress economically andsocially.

We seem to be sliding down a slippery slope, further down with eachpassing year of BN's rule. Another five years of BN rule and we'll beat Indonesia’s standard under Suharto. Another 10 years and we'll betouching the African standard. What a way to greet 2020.

Is there any hope for Malaysia?

Faced with the reality that BN will never change, many Malaysiansdesperate for change turn their lonely eyes to Anwar Ibrahim.

Pakatan Rakyat has promised to treat all races fairly, to plugwastage, fight corruption, reform the judiciary and make Malaysia morecompetitive.

But some have questioned whether we can trust Anwar and his loosecoalition of disparate parties.

The question is not whether we can trust Anwar and Pakatan Rakyat butwhether we can afford not to.

Can we afford another ten years of BN's misrule?

Marco's comment:
There is nothing much that middle-class Malaysians can do, my suggestios are:
1. Save as much money as possible, transfer it to Singapore, Hong Kong, London or New York's banks.
2. Acquire foreign countries shares where your money parked (refer to no.1)
3. Send your children to oversea universities, let them have a choice to make a living at other countries.

They are more and more elite Malays that moving out from Malaysia even they can enjoy bumi priviledges in this country. Why they gave up? Simply because they see no future for their next generation.

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