Malaysia Maju 2020

Malaysia, is a federation consisting of thirteen independent states which include Perlis Indera Kayangan, Kedah Darul Aman, Penang The Pearl Island, Perak Darul Ridzuan, Kelantan Darul Naim, Terengganu Darul Iman, Pahang Darul Makmur, Johor Darul Takzim, The Historical State of Melaka, Negeri Sembilan Darul Khusus, Selangor Darul Ehsan, Sabah The Land Below The Wind, and Sarawak the Land of the Hornbills; together with the Federal Territory of Kuala Lumpur, Labuan and Putrajaya. The capital and largest city is Kuala Lumpur, while the seat of government administration is in Putrajaya. Labuan is designated as an offshore financial centre. Malaysia is the third largest economy in South East Asia, with the third highest GDP per capita. It is an advance emerging market nation, with a population of 28 million people and the leader in Islamic financial services in the world. Malaysia aspires to become a developed, high-income nation by the year 2020, when it aims to achieve per capita GDP of US$15,000, from US$8,000 now.

Tuesday, February 28, 2012

Malaysian Union - A Dream Too Far? (Part 1)

In recent years some economists have emulated an economic union between the two nations on the Korean peninsular. Yes, you read that right, a united Korea between the communist north and the capitalist south. The union between the two countries have been suggested and discussed among the economic and political sphere for quite a long time, taking precedence from the unification of the Germans in 1989. However, the unresolved war between the two nations have made the idea of a "United Korea" on the back burner of the global agenda.

The unification of the two Koreas will create a an economic and military superpower, of which according to many, will surpass that of other first world and G20 economies such as Germany, France and even Japan. Currently, South Korea has the 15th largest economy in the world, and a major industrialist in Asia and the world. The North, however, has among the poorest in Asia, with a government-led economy and an autocratic regime.

The differences of the two Koreas have caused the idea of a reunification between the two become more complicated than it sounds. For almost 60 years, since the end of World War 2, the Koreas has been divided and ruled in a completely different ways. The North has been ruled and aligned to the communists, after being put under Russian administration right after the War, while the South has been ruled as a democratic, capitalist country pursuant to it being administered by the United States in 1945.

Despite the economic and social benefits that could be created out of a united Korea, the idea is hard to be realized. Although the two governments have made several commitments towards the unification, the most prominent ones being the June 15th North-South Joint Declaration, the economic and social disparities between the two nations is so vast that there's more oppositions to the idea rather than constructive actions by both parts.

Forget about the Koreas. This article is not going to discuss about the possibility and feasibility of a United Korea. Rather, this article seek to revive an idea which has been on my hearts, and I believe, many who call themselves "Malaysians". This article seeks to put forward the idea of a united Malaysia, or better worded or construed as - the formation of a Malaysian Union or Malaysian Confederation.

Since 1946, when the Imperialist British put forward a form of governance to the then Malaya, the Malayan Union, which consisted of the 11 states of the then British Malaya (now Peninsular Malaysia), the British was the one who separated Malaya's most precious jewel - Singapore. The Malayan Union was vehemently opposed by the Malay Nationalists back then because it took away the power of the states' Sultans over the governance of the country, while the democratic-socialist movement of All Malayan Council of Joint Action - Pusat Tenaga Rakyat (AMCJA-PUTERA) opposed it on the ground that it was done undemocratically and excluded Singapore from the Union.

After nationwide opposition in the form of public disobedience famously called "Hartal", the British government proposes the Federation of Malaya instead, in 1948, replacing the Union. Once again, the British separated Malaya and Singapore into two different political entities. This was however excepted by the Malay elites who pose major influence onto the people, as the governance form of the Federation recognises the function of the states' Sultans as the Head of States, although it remained largely ceremonial up to this day. By the time the Federation came into form, the idea of a united Malaya and Singapore fought by the AMCJA-PUTERA was largely dismissed.

However, after Malaya gained independence from the British in 1957, consequently the young government reignited the idea of a united Malaya and Singapore, which will be called "Federation of Malaysia". Together with the British territories of Sarawak and North Borneo (now Sabah), the Federation was realised in 1963. Nevertheless, after only two years of unification, Singapore was expelled in a highly emotionally-charged affair. The dream of a united, progressive Malaysia together with Singapore once again diminished in 1965. Since then, the two young countries has grown into among Asia's best economically and socially in their own rights.

Singapore today has a highly-advanced capitalist economy, governed by a semi-autocratic, but democratically elected representatives. It is a high income economy, with a GDP per capita of USD50,123. It is the financial capital of South East Asia, and also its major advance technology manufacturing base. Despite its tiny geographical size, population and lack of natural resources, its visionary leaders have managed to turn the once back water economy into one which is highly regarded in the international stage.

Malaysia too has done relatively well on its own right. Since the 1960s, the country has grown to become the third largest economy in South East Asia, surpassing its larger neighbors such as the Philippines and Vietnam, and only behind Indonesia and Thailand. However, in terms of GDP per capita at USD8,617, it stands as the third richest as well, but behind its smaller neighbors and once brothers Singapore and the oil-rich Brunei. It is the second largest producer of palm oil, third largest producer of natural rubber, and has the largest Islamic capital market in the world.

In terms of governance and political form, there are not many differences between the two countries. Malaysia and Singapore are both governed by democratically elected representatives and both uphold common universal values and human rights. Both have a prudent and sound economic and social policies, which are formulated to govern the various ethnics which made Malaysia and Singapore as their home.

The challenges faced by both countries could be deemed as reasonably similar, as both countries are trying to find the right balance for equitable growth across all races, while maintaining fair economic and social policies. For example, since the racial riot in 1969, Malaysia has adopted a positive discriminatory stand in favor of the Malays to increase the ethnic's participation in the country's economy, while Singapore has been to dependent on foreign labor to maintain high sustainable growth rate, in the expense of its very own delicate social fabric.

Actually, through the re-unification of Malaysia and Singapore, several economic and social problems which the neighboring countries are currently facing could be managed and handled better than if they were to stay separated as of now. For example, Singapore's labor shortage could as well be overcome by the larger labour force of which Malaysia has, while skilled labor currently based in Singapore could be utilised by Malaysian companies as well.

In terms of ethnic proportion, Singapore has a majority Chinese population at about 60% to 70%, while Malaysia has a majority Malay/Bumiputera population of about the same percentage. The increase in Chinese population would not make any major disruption to the social fabric in Malaysia, as it has already a large chunk of ethnic Chinese population. Although ethnic Chinese comprised about 2/3 of Singapore's population, that is actually only about 4.2 million additional Chinese population in absolute number. Malays would still be the largest ethnic in a reunified Malaysia at about 16.8 million in absolute number.

Economic and political policy, such as ethnic preferences in Malaysia and meritocracy and survival of the fittest in Singapore could actually be reconciled. In fact, Malaysia's ethnic preference policy is not blatantly used that it disregard merits at all cost. Meritocracy is still a prerequisite in Malaysia and ethnic preferences is just a tool to re-balance economic growth across all ethnics. Singapore's expertise could be tapped to bring in the culture of merits in Malaysia, and through time, ethnic preference could be dismantled, given strong political will by the federal government.

With the abundance of natural resources Malaysia is endowed with, and the greater population that it has compared to Singapore, could actually bring in more economic prosperity to Singapore. Already, Malaysia and Singapore is regarded by foreign investors as a single market, whereby both countries are the largest trading partner to each other. Malaysia exported raw materials such as crude oil and palm oil to Singapore to be refined (notwithstanding the fact that Malaysia too has a significant refineries) and re-exported to other countries in the region, for example.

(to be continued)




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