Much Ado About The 30% Bumiputera Equity Participation Policy
By Matthias Chang
Any genuine attempts by the government to mitigate the effects of the global financial tsunami and promote growth of the economy must be applauded and I do so here in this column. It is better late than never.
The policy instruments that are available to the Prime Minister who is also our Finance Minister are limited because of the nature of the problem that we have to confront.
If I may be permitted to use a simple analogy – If one has only five bullets and there are ten targets, shooting the wrong targets would be a waste of the bullets and if we end up without any bullets, we will be at the receiving end of hostile fire with no defences whatsoever.
When the government announced recently that the Foreign Investment Committee would be abolished, as its principal role of ensuring the 30% equity ownership by Bumiputeras of the Malaysian corporate cake has failed, it brought cheers from some quarters and deep anxiety and worries from bumiputeras and other stakeholders who were the primary beneficiaries of the “discarded” policy. But the first tier bumiputera elites have no complaints.
I appreciate that there is a desire to effect change and a serious attempt has been made towards that end, but the bullet fired has been wasted, because I take the view that the so-called policy change has not resulted in any fundamental shift in addressing the underlying social and economic issues.
Common sense tells us that this instrument of the NEP is an inaccurate measure of the share of the national corporate wealth and has in fact caused unnecessary friction and misunderstanding between the bumiputera and non-bumiputera communities in Malaysia. It is one of the root causes of the continuing racial tensions between the various communities in Malaysia.
The policy sounds good, looks good but its effects were far from being good for Malaysia, specifically the bumiputera community.
Let me explain this matter by applying common sense.
