Impact of manifestos policy lead from Malaysia’s General Electioon (GE14)

Market impact: The reaction of investors following the past two GEs is an example of how investors value certainty and how Bursa will be affected in the event of a Pakatan victory this time around.


Policy directions from political pledges have business and economic consequences.

EVER since Parliament was dissolved ahead of polling for the 14th general election (GE14), the combustible campaigning period has been mirrored by the volatile stock market.

The FBM KLCI hit an all-time high of 1,895 points on April 19, just a week after the dissolution of Parliament, but has since tracked lower as election day nears.

With the market edgy prior to polling day, UOB KayHian in a note on the election says that the election factor is a short-term sway phenomenon.

“While unexpected election results can be a significant market sway factor in the near term, such market reactions have been short-lived in the past.

“For example, when the Barisan Nasional’s control of parliamentary seats surprisingly slipped below two-thirds during GE12, the FBM KLCI plunged by as much as 9.5% in a day, triggering a trading circuit breaker at the worst level,” it says.

The research house notes that the FBM KLCI recouped most of the losses within a couple of weeks, once investors were assured of the continuity of political stability and business-friendly policies.

Both Barisan and Pakatan Harapan are mindful of maintaining business-friendly policies, it says. “Pakatan has on various occasions highlighted that it will generally uphold the sanctity of government contracts should it win the election. Eventually, equity markets will be dictated by external and domestic economic fundamentals and liquidity considerations.”

Market volatility and fierce campaigning do go hand-in-hand, given the uncertainties the outcome of the GE will bear on the stock market and businesses. Experts have said that the direction of the ringgit and also the economy will be determined after polling day as the country charts its political, along with economic and business, direction for the next five years.

“If Barisan wins, it will be seen as a vote for continuity. It will be business as usual, given the various plans and policies the Barisan government has laid out in the past and for the future,” says an economist.

“For businessmen, that mindset of what to expect is important for future planning and direction and they will like not to have any anxiety on what to expect in the future.”

The economic and business direction

The Barisan government, which has been in power since independence, has a track record of what it has done and will do for the country when it comes to business and economic planning.

The various Malaysia plans, budgets and policies announced over the decades have plotted the economic direction of the country. But in recent times, some will look at its manifesto as to the future policy direction the country will adopt should it retain power.

Policy promises are something more voters pay attention to these days, and judging by the manifestos of Barisan and even the Opposition, their documents are detailed with measures they will carry out in the impending five years.

For the Barisan government, the launch of its manifesto was done with much pomp, with it even detailing how it has fulfilled 99.4% of its 2013 manifesto pledges. Much of the focus of its latest manifesto is on the people, in order to lift their incomes and well-being.

These promises include raising the minimum wage in phases to at least RM1,500 within five years to setting up a Fair Works Commission to ensure that the salary levels of private-sector workers are more equitable.

BR1M recipients who enrol in higher education institutes will, meanwhile, receive a one-off assistance of RM1,500 plus there are a slew of measures for the country’s Felda settlers and their family members who are spread out over 317 settlements in 54 parliamentary seats nationwide in the manifesto.

Barisan is also promising to create three million jobs, and among the measures promised to help achieve this is by speeding up the development of the Malaysian Vision Valley, a 150,000ha area that is projected to create 1.3 million job opportunities.

On housing, the manifesto pledges a number of measures including setting up a special bank to facilitate loans for affordable and low-cost housing priced RM300,000 and below.

In addition, tax incentives or development funds will be provided to encourage banks and housing developers to offer rent-to-own schemes.

CIMB Research in a note on Barisan manifesto points out the key pledges which include low-income households, Felda settlers, females, the elderly and farmers.

It points out that the key promises include a top-up on the BR1M payments, raising the minimum wage to RM1,500 within five years, potential revisions in personal and corporate income taxes, expansion of affordable housing aid, special incentives and funds for Felda settlers, and subsidised public transport passes, broadband and other consumer goods/services.

It says that the additional BR1M payments will amount to at least RM3.71bil or 0.25% of gross domestic product (GDP) in 2018, which comes on top of the prior week’s civil servant pay hikes of RM1.46bil effective July 1.

“New spending commitments imply that the budget deficit is unlikely to improve significantly from the target of 2.8% of GDP despite windfalls from higher oil prices and GDP growth,” CIMB says.

It believes the market is expecting the ruling coalition, Barisan, to win the majority of the Parliament seats.

“We view Barisan’s widely expected win as neutral to positive for the market. The stock market’s performance post-election will depend on the degree of selling pressure during the campaigning period and the poll results.”

What the additional cash injection to households will mean is a lift in consumer spending. Consumption is a big driver of the economy and the BR1M payments have been one of the reasons for the steady performance of domestic demand.

“Furthermore, the economy will get a lift from the lift-off from projects that have already been identified for construction. The MRT, the high-speed rail between Kuala Lumpur and Singapore, and the construction of Bandar Malaysia will be some of the projects that will lift the construction sector and also the economy,” an economist says.

During the years when pledges from the past Barisan manifesto were being carried out, the economy had its ups and downs given the crunch felt by the collapse in crude oil prices.

The GDP, nonetheless, during the past five years has been positive, given the rollout of projects during that period. Growth came in at 5.9% in 2017 and was 4.2% in 2016, 5% in 2015, 6% in 2014 and 4.7% in 2013.

There have been concerns that spending pledges contained in the manifesto would leave a hole in government finances, but indicators so far do not point to that being a problem.

The government’s debt-to-GDP ratio has fallen below the self-prescribed ceiling of 55% to 51% and going by what the data shows in the first quarter, government finances seem to be holding up.

Nomura in a note says that Malaysia’s fiscal deficit was RM11.2bil in the first quarter of 2018, or 3.3% of GDP, which was below its forecast of 6%.

“This is smaller than any of the first-quarter deficits in the previous five years,” it says.

Nomura says revenue collection appears to have exceeded expectations significantly, surging by 16.5% year-on-year in the first quarter and was likely boosted by higher oil prices and possibly some lagged effect from strong GDP growth last year.

“However, more surprisingly, spending appears to have been quite restrained, falling by 2% despite the GE on May 9. Spending details have yet to be released but such restraint may prove temporary with the government likely concentrating the use of its fiscal firepower closer to election day,” it says.

“This likely explains the government’s confidence in maintaining its 2018 deficit target of 2.8% of GDP despite announcements of additional cash handouts around the election.

“While we continue to expect government spending to spike in the second quarter, the surprising outturn in the first quarter suggests that fiscal tightening in the second half may be less severe than we currently forecast,” it says. By Jagdev Singh Sidhu The Star

Election a short-term market sway phenomenon

THE consensus is for the Barisan Nasional to win the upcoming general election (GE) to be held next Wednesday. But what if Pakatan Harapan were to win?

The immediate implications of a Pakatan win will be on the financial markets. The other implication is the impact in the mid to long-term of a Pakatan win on the economy.

The financial markets

There is no precedence for a win by the parliamentary Opposition in Malaysian history, and because investors prefer certainty, the financial markets are sure to be volatile.

The reaction of investors following the past two GEs is example of how investors value certainty and how Bursa Malaysia will be affected in the event of a Pakatan victory this time around.

The local bourse’s benchmark, the FBM KLCI, slipped 9.5% on the first day of trading after the 2008 election, which was held on a Saturday. This was after Barisan lost its two-thirds majority in Parliament for the first time and also lost control of five state legislatures.

In 2013, the stock market fell the week before the election on speculation of an Opposition victory at the federal level. That was the year when many felt sure that Barisan would lose. The Barisan clung on to power but lost the popular vote. The stock market rallied.

While there certainly was a reaction by investors, it must be noted that the Malaysian financial markets, including the stock market, do not act in isolation.

In 2008, fund flows were also influenced by broader movements in the global markets made volatile by the global financial crisis.

“Don’t forget that news flow from the US markets was bad on a daily basis,” a fund manager with an emerging-market portfolio points out.

Shortly after the 2008 election, Bear Stearns Companies Inc, an investment bank, was taken over by another investment bank, JPMorgan Chase & Co, in an operation largely directed by the US Federal Reserve (Fed), which was afraid of what the failure of a Wall Street institution would do to market confidence.

The fund manager tells StarBizWeek that investors just took the opportunity to offload riskier emerging-market assets following the outcome of the election.

“It’s normal to point to market swings either way to domestic factors but in reality, for the index to move, institutional shareholders must react and they rarely do so on just domestic factors, especially in that period of time,” he says.

The same reasoning goes for currency movements. The ringgit’s weakness in the past month has been blamed on investor jitters prior to the upcoming election, but pressure on the currency is really coming from rising US bond yields.

Investors are repositioning on market speculation of four instead of three US interest rate hikes and this has had an impact on emerging-market currencies as well as equity markets.

Although the Fed left the benchmark interest rate unchanged in a recent meeting, officials say that inflation is close to the 2% target. The market expects the Fed to raise the federal funds rate a second time in June when it next meets.

How this works is that investors are anticipating that new US government bonds will now be issued with a higher coupon rate, which is the interest that is paid out annually on the bonds because of the higher interest rates. Also, because of the anticipation, the earlier issued bonds, with a lower coupon rate, will now be traded at a lower price, and because there is an inverse relationship between bond prices and yields, there is a rise in bond yields.

This is why the benchmark 10-year US Treasuries yield is now higher, because the price has dropped, causing US bond yields to narrow against the yields of similar-tenor bonds of foreign government issuers.

For example, the yields between the 10-year Malaysian Government Securities and the 10-year Treasuries have narrowed, making Treasuries – because of its safe-haven status and underlying currency strength – a more attractive asset.

An interest rate hike also means that inflationary pressure is picking up because of economic growth and that will attract investors too.

The steady US economic outlook, US dollar strength and safe-haven status at a time of much geopolitical uncertainty are also attractive factors. Currency strategists point to US dollar movements as more important when taking into account the US dollar/ringgit pairing. The decisions of US policymakers as well as other external factors such as trade will have more weight on the ringgit’s direction rather than purely domestic factors.

Even the rising oil price has not been able to stem the weakness in the ringgit, and that is because of the investors repositioning rather than any inherent political risks.

However, a political analyst did say that without the higher oil price, the ringgit could have seen a steeper fall. “It could be that rising US bond yields is the reason for the ringgit’s weakness but I believe that political factors are at play too and that without the higher oil price, the ringgit would have fallen even more,” he says.

The economy

A Pakatan government will have to find a middle path in unravelling some of the more unpopular policies, while ensuring policy continuity and assuaging the concerns of investors.

Both Barisan and Pakatan claim to have the people’s welfare at heart, and both claim they want to alleviate the cost-of-living issue that Malaysians have been grappling with in recent years. The Pakatan coalition is also calling for the shaping of the nation’s economy in a fair and just manner.

The Pakatan promises must take into account the urgent need for the economy to move up the value chain. In one respect, a focus on high-end manufacturing will have a positive spillover effect, as such initiatives will attract high-end service jobs including banking and financial services as well as research and development opportunities.

The Pakatan manifesto launched in early March includes 10 promises to be implemented within 100 days of winning the election. Among the promises are the abolishment of the goods and services tax, reintroducing the petrol subsidy and increasing the minimum wage to RM1,500 by their first term in office.

Moody’s Investor Service analysts say in a report released yesterday that the implications on the country’s credit standing will be determined by the impact of the election results on existing government policies, with particular regard to fiscal consolidation and debt trend.

“Ahead of the election, Barisan and the key opposition, Pakatan, have both unveiled their manifestos and specific spending programmes targeted at key voter bases. These measures include raising the minimum wage, greater cash handouts and relief for Federal Land Development Authority settlers, among others,” they say.

The rating agency, which has maintained the country’s A3 credit profile with a “stable” outlook, says the impact of these programmes on the sovereign credit will depend on how they are funded and whether they have a negative effect by delaying the government’s ongoing efforts at fiscal consolidation.

“Economically, these programmes are likely to boost consumption over the near term but against the backdrop of Malaysia’s export-driven growth, the impact is not likely to be material and could be offset by inflation,” they note.

Another crucial promise is to launch detailed studies of multi-billion-ringgit projects awarded to foreign countries. This particular promise is likely aimed at China, which has become a major investor, if not the largest in recent years, with not only infrastructure projects but also property development.

Pakatan will have to tread carefully where reviewing contracts is concerned, as the sanctity of contracts is crucial to investor confidence.

“Any review of the mega-projects will have to be done in a tactful manner. Malaysia is not the United States, we don’t have the heft, so we need to be careful,” an analyst says.- by Fintan Ng The Star

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DAP’s ‘king vs king’ strategy will rob the community of the worthy talents

GE14 will be about race, warn analysts |

‘The outcome of such a strategy will deprive the Chinese community of some good politicians’ – Tan Sri Pheng Yin Huah

Leaders against rocking the boat

This Saturday’s nomination day, DAP is facing increa­sing pressure from Chinese so­­cie­ty to drop its strategy to jiao mie (wipe out) outstanding Chinese lea­ders within the Barisan Nasional.

In the past two weeks, several Chinese guilds – which claim to be apolitical – have come out openly to oppose this DAP stunt which will see the DAP fielding its strong candidates against leading Chinese po­­liticians from Barisan’s MCA and Gerakan.

Many commentators within the community have also published their views in Chinese media ­ar­­guing against the DAP plan.

Most Chinese newspapers have also voiced their stand against this strategy.

In essence, many see this “king versus king” plan advocated by DAP as wiping out the limited number of outstanding political talents within the community.

Whoever wins or loses in the election, the Chinese community will lose a talent and the ultimate loser is the community, they argue.

The decision by DAP to transfer its political strategist Liew Chin Tong from Kluang to the Ayer Hitam parliamentary seat to collide head-on with MCA deputy president Datuk Seri Dr Wee Ka Seong has not been well received from the start.

Neither is the move to send Perak DAP chief Nga Kor Ming from Taiping to Teluk Intan to rock the parliamentary seat held by Gerakan president Datuk Seri Mah Siew Keong.

Among the Chinese associations that have made their opposing stand known are the Federation of Chinese Guilds in Malaysia (Hua Zong), the normally low-profile Federation of Kwang Xi clans and the Federation of Heng Hua clans.

Hua Zong’s president Tan Sri Pheng Yin Huah tells The Star: “We cannot interfere with DAP politics, but as a community leader I hope DAP can consider our views to change this election strategy.

“The outcome of such a strategy will deprive the Chinese community of some good politicians – ­whe­ther they are from Barisan or Opposition, and this is a loss to the community.”

Last Monday, Pheng issued a media statement to this effect. But in response, DAP secretary-general Lim Guan Eng alleged that Hua Zong was an “external organisation” of MCA.

Lim, in justifying the DAP strategy, said it would help the Opposition coalition Pakatan Harapan to win more parliament seats so as to take over Putrajaya to rule the country.

It appears that DAP is unlikely to change this unpopular strategy.

While Lim can ignore Pheng and the other Chinese community lea­ders who are not voters in Ayer Hitam and Teluk Intan, he should listen to the voices on the ground.

A professional in Ayer Hitam, who was my high school classmate in Batu Pahat, told me in my recent trip down south: “I normally support the Opposition, but this time I am going to vote for Wee Ka Siong.

“He is a good minister and has done so much work for the people. Everybody here can see.”

His feelings are shared by my other former Batu Pahat high school friends.

Prominent commentator Tang Ah Chai, who is normally more pro-Opposition in his analysis, has warned DAP to handle the discontent from Chinese society with caution to avoid backlash in the coming election.

“The Chinese community is worried that if there is little or no re­pre­sentation in government, their aspirations and voice cannot be effectively channelled to the top and their interest will be undermined. They experienced this when MCA did not join the Cabinet,” Tang commented last Friday.

Prime Minister Datuk Seri Najib Tun Razak has warned that there will be a cut in the number of Chinese ministers, in the event Barisan wins the election, if Chinese support for MCA and Gerakan dwindles.

While Pheng does not expect Lim to change DAP’s strategy, which has also been employed in Sarawak, other leaders hope Lim can turn a page on DAP history.

“Look at what happened in 1982 when Seremban sent a strong ­message that voters wanted MCA leader to stay on,” said one.

In the 1982 general election, in response to a taunt by DAP to contest in a Chinese-majority area, the then MCA president Tan Sri Lee San Choon contested in Seremban to face DAP chairman Dr Chen Man Hin, who had held that parliamentary seat since 1969.

Not only did Lee win in the battle, MCA scored a landslide victory – winning 24 out of 28 parliamentary seats and 55 out of 62 state seats it contested.

DAP was nearly wiped out in that general election.

One of Lee’s projects that have benefited many Chinese is TAR College to expand tertiary education opportunities for the Chinese at the time.

While the 1982 election has come to pass, the sentiment of Chinese against “king versus king” is still present.

by Ho Wah Foo The Star

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Political parties banking on votes from the civil servants, the sacrosanct!

The civil service is sacrosanct, politically speaking. If you are a politician, you better think twice before speaking up against it.

ALTHOUGH more non-Malays are beginning to join the civil service, the fact that Malays make up the overwhelming majority of the 1.4 million-strong public sector remains.(The highest ratio of civil servants in the world)

Civil Servants_Malaysia

It is said that nearly every Malay family has someone either in the civil service or the uniformed services.

Thus, the civil service is home to a sizeable percentage of voters. Therefore, their welfare and livelihood is a key priority of the Barisan Nasional Government which likes to project itself as its protector and benefactor.

On the other hand, the Chinese and Indians predominate in the private sector as small businessmen, professionals and wage earners.

They are largely cut off from the civil service. They have little clue how the civil servants, as a unified special interest group, think and respond in a crisis.

This is the reason why some Chinese and Indian politicians and even some thoughtless Malays make insensitive remarks about the civil service and pay a price for their faux pas.

The more seasoned politicians in Umno and other Barisan component parties managed to avoid making insensitive remarks, preferring to work with the civil service rather than against them.

When civil servants die in the line of duty, Barisan gets all worked up. It immediately moves in to comfort and reassure them as it is mindful of the civil services’ vote bank.

When security personnel were killed by Sulu insurgents, the Government’s game plan changed as well.

Prime Minister Datuk Seri Najib Tun Razak ordered an all-out assault by a combined force of army and police personnel.

Resources were rapidly mobilised, villagers told to move out and security forces encircled the red zone and the shooting war started in earnest.

When Najib announced the decision to attack on March 5 at a gathering of religious leaders at Putra Stadium, he was given a standing ovation.

The civil servants had rejoiced that the initial decision to negotiate was over and that the army and police were on attack mode.

The Opposition, on the other hand, had fallen flat. They had failed to connect with the powerful emotional impact the crisis had on civil servants and the Malay voters.

In fact, they committed a faux pas of the worst kind imaginable when PKR vice-president Tian Chua remarked that the Lahad Datu crisis was a sandiwara by Umno and Barisan Nasional.

His remarks, published in Keadilan Daily on March 1, had riled up the Malay groups, including former servicemen, who vented their anger and demanded an apology and retraction.

Not a day passes by without someone burning or stomping on pictures of Tian Chua and lodging a police report and urging stern action.

At one anti-Tian Chua session, even former IGPs and former deputy IGPs were out condemning Tian Chua and rooting for the Malaysian security forces.

The message out there is simple while the armed forces are risking their lives in protecting the country, Opposition politicians are playing politics.

The civil service is sacrosanct, politically speaking. If you are a politician, you better think twice before speaking up against it.

Former Selangor Mentri Besar Datuk Seri Dr Mohd Khir Toyo had angered civil servants when he gave out a broom as an “award” to two underperforming local councils in Novem-ber 2007.

While he wanted to improve the service, the civil servants saw it as demeaning and felt slighted. They took it out by spoiling their votes when the general election came, contributing to the fall of Barisan in Selangor.

In more recent times December 2011 Petaling Jaya Utara MP Tony Pua was forced to eat humble pie after he announced that Pakatan Rakyat would slash the civil service by half, if it takes power.

Pakatan leader Datuk Seri Anwar Ibrahim had to step in and assure the civil servants that Pakatan would do no such thing if it is in power.

Even Pua, who stands in an overwhelmingly Chinese seat, was forced to clarify that he did not mean “slash by half” but reduce its numbers through synergies.

The civil service is overwhelmingly Malay and largely pro-Barisan, who is their protector and benefactor; although PAS and, to a lesser extent, PKR are making a dent.

However, it is not big enough a dent for the supposedly neutral civil servants to change direction as yet.


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Malaysian too distracted to be patriotic?

It may be the National Day month but most people are more preoccupied with the upcoming general election.

EVERY August, many of us look forward to the entire nation being awash with feelings of warmth and patriotism as we celebrate our National Day on the last day of the month.

Aug 31 was, until 2010, celebrated as the National Day as it was the day Malaya gained its independence from the British colonial masters, but this caused many Sabahans and Sarawakians to feel left out because their independence did not come until Sept 16, 1963.

Thus, the Government from 2010 declared that Sept 16 would also be a national holiday as it was the day Malaysia was formed – a move many Malaysians on the Borneo side of the country felt was long overdue.

So instead of a one-day National Day celebration, we now have a month-long one from Aug 16 to Sept 16. During this time Malaysians are encouraged to fly the Jalur Gemilang.

This is something that I have been doing regularly even before the call from politicians because I am a very patriotic Malaysian and unlike others I only declare myself as a Malaysian and nothing else.

However, this year I find it very difficult to bring myself to fly the flag. The amount of quarrelling and finger pointing that is going on at the moment makes it very bitter to express my patriotism.

Yes, there will be many of you who will say that the finger pointing and political posturing that’s going on at the moment are also a show of nationalism.

I do not disagree that being politically partisan is part of our democratic process but I cannot help but feel that the political temperature has gone too high for anyone to show his or her loyalty and love for the country.

From the way every act connected with the celebrations of Aug 31 and Sept 16 have been criticised and attacked on the Internet, any neutral but patriotic Malaysian will question themselves if they are being nationalistic or bias towards one side.

The way the criticisms flew when a certain logo was suggested for this 55th celebrations left many quarters stunned. It’s only a logo but yet the venom with which the attack was carried out was frightening.

Would the act of flying the Jalur Gemilang be mistaken as a symbol of support for one side or the other?

Yes, the way the Government had planned the National Day celebrations may not have been very bi-partisan with most of the programmes seemingly be centred around the achievements of the Government of the day.

Yes, the so-called 55th Merdeka song “Janji ditepati” reads like a roll call to the achievements of the Barisan Nasonal government.

But that’s what all the other 54th celebration songs, logos and themes were about – singing praises of such achievements and the 55th anniversary celebration plans are not very different.

The difference, I feel, is the heightened tension in the country stoked by the high expectation of an impending general election.

People are now too busy guessing when the general election will be held to be bothered about anything else.

Recently, there was a rumour that it would be held in September because “someone told someone” but according to the same media a few days later, it has again been “postponed” to November it seems.

Why? Because two Sabahan Barisan Nasional politicians had left their party positions to co-operate with Pakatan Rakyat.

The “jumping” of the two had been expected for over two months.

Nothing done these days is not seen to be connected to the GE 13. It does not matter whether it is the shortage of water or the call for the protection of certain environmentally sensitive places.

The problem is that politicians have been quick to jump on the bandwagon to use these issues to attack their opponents and instead of these matters being resolved, they get muddied by politics.

Politicians, regardless which side of the divide they are from, are extra sensitive during this run up to the general election. Every statement, newspaper report or social media comment which they deem as not favourable to them as made by people with an agenda against them.

Even supposed defenders of press freedom want to gag the media in case their reports do not favour their side.

The country is highly charged. Recently, it was reported that an elderly couple in Pasir Emas, Kelantan was divorcing after 14 years of marriage, the husband allegedly could no longer convince his wife to join his political party.

The 78-year-old man reportedly accused his 61-year-old religious teacher ex-wife of deviating from Islam for not supporting his party. The wife was supposed to have supported Umno while the husband was an ardent follower of PAS.

If political differences can destroy a marriage then what chance has our National Day celebrations got?

As it is, I am the only person in my multi-racial neighbourhood who bothers to fly the Jalur Gemilang come every August. I put this down to the apathy of my neighbours and the lack of patriotism due to ignorance.

They do not realise that the expression of patriotism by flying the flag is the best way to show that we are Malaysians and that nothing can take that away from us regardless of our religious or cultural backgrounds.


> Executive Editor Wong Sai Wan will not bother to dig out the old Jalur Gemilang this year – he will go buy a new one – regardless if it’s the silly election season.

Parti Cinta Malaysia (PCM) seeking love from Penangites

Seeking love from Penangites  


Malaysia’s ‘love party’ hopes Penangites will give it a chance and send at least three of its members to Parliament and the state assembly.

THE Thaksin Shinawatra of Batu Kawan hobbled from table to table at a school hall in Seberang Prai, Penang, shaking hands with dinner guests before reaching the VIP table.

The 50-year-old politician was on crutches. He had broken his right ankle at his home in Penang on New Year’s Day.

During the dinner, organised by the Benevolent House of Charity, volunteers sold Chinese newspapers to collect funds to build a Chinese school.

The total collected was RM1,950 and, true to his moniker, Huan Cheng Guan topped up the amount to RM5,000 by donating RM3,050. He also donated RM1,000 to Benevolent House of Charity.

Strong support: Huan, on crutches, being greeted by guests at the Benevolent House of Charity dinner at SJK (C) Keng Koon hall in Bukit Mertajam.

“The money comes from my personal savings. It is for a noble cause,” he said.

It was a typical Sunday night for the vice-president of Parti Cinta Malaysia (PCM).

He had earlier spent 20 minutes at a Chinese wedding in Dewan SJK (C) Kampung Valdor, a few kilometres from SJK (C) Keng Koon where the charity dinner was held.

“As a politician, you need to go to the ground to meet the people. You need to have the personal touch,” he said.

Ninety minutes into the dinner, Huan left for nearby Restoran Long House to meet PCM members and supporters for a seafood dinner.

“This is not an election dinner. The election is still a long time away,” he told about two dozen guests, mostly Indians, seated at three tables.

While his guests waited for curry prawn and fried rice to be served, I interviewed Huan.

“Why are you called the Thaksin of Batu Kawan?” I asked. I was told he is as generous as the former Thai prime minister.

“Who said that? I’m not the Thaksin of Batu Kawan,” replied Huan, who describes himself as “blunt and rough”.

“Maybe I am called that because even though I am no longer their MP, I seldom reject associations and people seeking my help as long as they are for a good cause.

“Maybe it is because I am not stingy for if I have RM100, I don’t mind donating RM90 as I can’t take my money along with me when I die.”

Huan is the only recognisable face in the Penang-based party born on Aug 2, 2009.

“Many people know me as I’ve been an MP and a Gerakan vice-president,” said the politician who “sacked himself” from Gerakan in 2009 after it suspended him for three years for openly attacking the party and its leadership.

Huan was elected Batu Kawan MP in 2004. In 2008, he was dropped so that Gerakan president Tan Sri Dr Koh Tsu Koon could contest the constituency, only to lose.

Huan contested in the Bukit Tambun state seat (in the Batu Kawan parliamentary constituency) and lost.

The president of PCM is 41-year-old businessman Tang Weng Chew who, according to Huan, is very busy as he has business overseas. And the secretary-general is 35-year-old accountant Loo Kien Seang, who is equally busy.

“I asked Loo to contest (in the coming polls) but he said: ‘if you want me to contest, I will resign (from PCM)’,” he said.

PCM was formed as a third force to be an alternative to Barisan Nasional and Pakatan Rakyat. Many naysayers predicted the party would not last more than one or two years.

“But we are still alive and kicking. We don’t have any internal problems. In our party, position is not important,” he said.

On allegations that his party was pro-Barisan, the vice-president said: “PCM has limited resources so we are focusing on Penang.”

In the coming polls, PCM will contest in two parliamentary and eight state seats in Penang.

“As a small party we have to be realistic and we target to win one parliament and two state seats,” said Huan, who is eyeing the Batu Kawan parliamentry seat and the Machang Bubok state seat.

He hopes Penangites will give PCM a chance to voice out their issues.

“Pakatan has too much power and when they have too much power, they become very arrogant,” he said.

The “love party” is expecting some love from Penangites.

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Malaysia’s looming General Election 2012

Key trends in the looming GE13


Datuk Seri Najib Tun Razak is slated to win the next general election, with the margin depending on how both sides of the political divide appeal to and win over the 1.9 million new voters.

I HAVE spent the past three weeks almost exclusively in Malaysia – travelling and listening to people. A lot of this time has inevitably been spent with fellow writers and editors.

In fact, journalists prefer talking to other journalists so there’s always a danger that we’re living in a bubble — something that we often accuse politicians of doing!

At the same time, and as explained by Malaysian Insider’s Jahabar Sadiq: “We were caught napping in 2008. Ever since, we’ve been over-compensating.”

So bearing in mind our collective fear of being wrong, here – for what it’s worth – are the key trends I’ve identified that will feature in the next general election (GE).

> The delayed pendulum: Ma­lay­sian GEs have tended to follow a pendulum-like movement, with swings to and from Barisan National (BN) in alternate polls.

However, in 2012/3 there will be a subsidiary trend at work in Sabah, Sarawak and Johor (dubbed BN’s “Fixed Deposit”) if there is a shift of Chinese support while the rest of the peninsula reverts to form.

> The democracy wave from Singapore: The vote in southern Johor will be impacted by the many Malaysians who live and work in the city-state.

Having observed the republic’s two nation-wide polls (parliamentary and presidential) in 2011 and witnessed the extent to which the PAP government subsequently reversed unpopular housing, healthcare and immigration policies, Johoreans will have learnt the value of tactical voting in order to engineer policy shifts.

> Sabah: West Malaysian/Umno leaders continue to underestimate the importance of the Royal Commission of Inquiry on Illegal Immigrants for Sabahans (especially the KadazanDusun and Murut communities).

> The Prime Minister’s two key performance indicators (KPIs): Datuk Seri Najib Tun Razak is slated to win the next GE.

However, victory is only the first of his KPIs.

The second is that he must surpass his predecessor Abdullah Ahmad Badawi’s 2008 showing (140 seats).

Indeed, the rationale behind Najib’s rise to the premiership was his unspoken promise of returning Umno (and BN) to its earlier glory. Failure to achieve this will lead to a reassessment of his leadership.

> Najib’s presidential style campaign: It has boosted the premier’s approval ratings. Given the fact that Malaysia has adopted the Westminster system, the PM’s popularity has not translated into greater support for Umno (or BN), leaving many potential candidates to struggle.

As such, there is no guarantee that Najib’s personal popularity will strengthen BN in the 13th GE.

> Newly-registered voters: Esti­mated at some 1.9 million, both sides are scratching their heads as to how to appeal to and win over this disparate and largely disinterested mass of voters.

There appears to be little party loyalty and commitment among this group. Their support may well depend on a last-minute and/or unexpected political “black swan-type” event triggering a sudden and massive swing in either coalition’s favour.

> Indian community: The community is no longer virulently anti-Barisan. While Malaysian Indians are by no means “grateful”, the Hindraf-connected anger has dissipated with the departure of MIC honcho Datuk Seri Samy Vellu and Datuk Seri G. Palanivel’s low-key leadership.

The Indian vote will help BN in countless marginal seats.

> NFC – “Istana” Mat Deros for 2012: In 2008 we had Umno’s Port Klang Assemblyman, the late Zakaria Mat Deros, and his infamous “Istana” built on allegedly illegally-acquired land.

In 2012/13 we have the National Feedlot Corporation (NFC) scandal, which continues to unfold.

The NFC has been very damaging in rural Malay and Indian communities where voters are most familiar with the economics of cattle-rearing.

> Changing face of domestic politics: Malaysian politics is shifting. This will be the last GE for “institutional” players, the Umno warlords who refuse to court public opinion.

Most of these political dinosaurs can’t be bothered to engage with the public, debate and/or win support from the media.

Indeed, party hacks – from both BN and Pakatan – will become increasingly unpopular and loathed.

They have no future and will be replaced by those who can think, talk and argue in public such as Saifuddin Abdullah, Zambry Abdul Kadir and Shabery Cheek.

Emotional intelligence and humility will also be important. The absence of these two qualities will lead to the premature political demise of certain candidates.

> Kedah: Pakatan extols its successes in Penang and Selangor. However, the coalition is strangely silent about the Kedah government’s less than sterling record of administration.

> Public trust in the Government: Widespread cynicism and distrust will force the Government to shelve many policy and business initiatives.

BN’s ability to command public support without extensive consultation and stakeholder engagement has evaporated.

Put all this together and what do you get? A very, very interesting 2012/13 indeed

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Economic policies that do not add up

P36: Kubang Ikan, Kuala Terengganu. Anwar Ibra...

Analysis By Baradan Kuppusamy

The lack of economic expertise in Pakatan Rakyat underlines the many difficulties the Opposition would encounter if it captures Putrajaya.

WHILE Pakatan Rakyat has been quick to capitalise on Barisan Nasional’s political setbacks like the current controversy over the National Feedlot Corpora-tion, it is weak in its economic policy formulation, and one reason is the lack of qualified economists.

This shortcoming would weigh heavily on the coalition if it were ever to capture Putrajaya.

Its weakness in formulating economic policies like the Alternative Budget 2012 that Datuk Seri Anwar Ibrahim read out to reporters a day before Prime Minister Datuk Seri Najib Tun Razak presented his Budget in Parliament, is a sign of its incompetency in ruling the country.

The Pakatan Rakyat budget was a wishy-washy affair. More thought should have gone into it beyond a cursory glance at where revenue is coming from and the expenditure incurred.

Instead Anwar just “handed out cash to the poor, teachers and farmers”.

The failure to formulate a serious, alternative Budget is yet another example of the weakness of the coalition that would affect their ability to rule the country.

Its inability to go beyond making unrealistic and populist demands and criticising the policies formulated by the experts i.e. Bank Negara economists, is a setback to Pakatan growing into a valid and competent coalition.

Populist policies are easily made but their implementation is hard, if not totally unrealistic.

For instance, Anwar campaigned in 2008 that if you voted for him and he takes Putrajaya, the price of oil would be lowered the very next day..

He can do it by further subsidising the price of “subsidised oil” – and that is economic madness and unsustainable.

Furthermore, Anwar is economic adviser to the Selangor government, earning a fee of just RM1 – another populist measure that gels well with the rakyat in the state. But how much FDI (foreign direct investment) has he brought into Selangor?

Beyond sloganeering like merakyatkan ekonomi, what are the realistic economic steps that he has taken thus far?

The lack of qualified economic formulators is glaring and shows how the Barisan federal government is far superior in that respect to the proposed Pakatan government when it comes to administering the economy, warts and all.

This lack of economic know-how was apparent in a leaked US State Department cable by Wikileaks on Nov 8, which stated that Pakatan lacked economic policy formulators within its ranks and how this shortcoming weighs on them as a coalition.

It also speculated why this was so and suggested that it could be due to Pakatan’s failure to give them high wages and that “politics” could have frightened them away.

The lack of economic expertise among them underlines some of the many difficulties they would encounter if they capture Putrajaya.

While the Opposition-run states are struggling without competent experts, their politicians also show little aptitude for heavy economics.

Except for Tony Pua, the DAP MP for Petaling Jaya Utara, there are no competent economic advisers working with Opposition controlled states that are struggling to line up economic advisors, the cable noted.

Pua is a one-man-band and he has his hands full. Besides, “one swallow does not make a summer”.

And, if Pakatan captures Putrajaya, PAS will pull the country one way and PKR in another and the DAP, a third way – demanding that affirmative action policies are abolished immediately.

Each is committed to its own constituents in different ways. There is little cooperation among them on economic matters beyond agreeing on political matters like seat sharing and working to capture Putrajaya.

There’s is no deal on how Pakatan would rule the country, no documents stating the basis of their rule and no power-sharing formula.

They have no shadow Cabinet.

Their power-sharing formula, in the event they capture Putrajaya, is simply that Anwar would be prime minister and his deputies would be DAP’s Lim Kit Siang and PAS president Datuk Seri Abdul Hadi Awang.

There is also not much difference between Barisan and Pakatan in the broad policy framework for the country. They are both for an open economy and for FDI to grow the economy.

But there the similarities end and the differences emerge.

There are differences over affirmative action policies that is favoured by Barisan, PKR and PAS but not by the DAP. This is a cause for dissension.

While all three Pakatan parties are against corruption along with Barisan there is a realisation that much of the corruption is linked to the affirmative action policies and that corruption can only be defeated if that policy is abolished.

This is the DAP’s stand and it is markedly different from the rest.

Pakatan’s weakness in economic matters would show immediately and in a serious manner if they ever were to capture power. There would be chaos as they find their bearings, if at all.

The state will be pulled in different ways – between Anwar’s populist promises, PAS’ Islamic economics and the DAP’s desire to streamline the civil service and abolish affirmative action.

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