Lessons from Malaysia: Why Singapore needs a strong and stable government

Lessons from Malaysia: Why Singapore needs a strong and stable government
June 2nd, 2010 | Author: Your Correspondent
OPINION

When Law Minister Shanmugam spoke about the need for Singapore to have a “strong and stable” government which makes “quick and effective” decisions a few months ago in Parliament, he was greeted with a dose of cynicism and derision by some netizens who saw it as another lame attempt to justify the PAP’s dominant position in Singapore politics.

The latest developments in neighboring Malaysia have provided us ample lessons on why it is important for Singapore to have a strong government and a weak opposition in order not to hamper the decision-making process for the greater good of the nation.

For over 50 years, Malaysia is governed by the ruling Barisan Nasional coalition (formerly known as the Alliance) which enjoyed two-thirds majority in the Dewan Rakyat (Malaysia’s Parliament) till the 2008 elections when the opposition won an unprecedented 82 out of 222 seats in Parliament and lost control of 5 states including the two richest states of Penang and Selangor. (the number is now reduced to 72 after a spate of defections and resignations of MPs from Parti Keadilan Rakyat)

Malaysia used to be an attractive investment destination for MNCs, but the political uncertainty has made a dent on foreign investment with net portfolio and direct investment outflows reaching US$61 billion in 2008 and 2009. Little money has also flowed into equities, according to central bank statistics.

Investments into the opposition-controlled states have slowed down too as investors are unsure if the state governments will survive till the next election after the Perak fiasco which saw Barisan wrestling control of the state back from the Pakatan Rakyat following the “defection” of three lawmakers.

The recent spate of resignations of PKR MPs from the states of Kedah and Selangor have spooked potential investors who are left wondering if business deals signed with the present state governments will be honored in the event that there is a change in government.

At the Federal level, the resurgent opposition has kept the Malaysian government on its toes, preventing it from implementing much needed reforms to liberalize the economy.

Malaysia spent 15.3 per cent of total federal government operating spending on subsidies in its 2009 budget when its deficit surged to a 20-year high of 7 per cent of GDP.

A Minister warned recently that unless Malaysia cut back on the subsidies, it will become bankrupt in 2019.

Prime Minister Najib Razak, an economist by training, has proposed the New Economic Model (NEM) to replace a four-decades old Malay affirmative policy known as the New Economic Policy (NEP) which gave a wide array of economic benefits to the “bumiputras” or ethnic Malays sometimes at the expense of other races.

Investors have long complained that abuse of the policy spawned a patronage-ridden economy, promoted corrupted practices, retarded Malaysia’s competition and causing foreign investors to favour Indonesia and Thailand.

Najib’s moves to roll back the NEP have met with stiff opposition from Malay rights group Perkasa which rejected the NEM outright and called on the NEP to be preserved.

Though cutting back on subsidies will have an immediate impact on low-income Malaysians, it will benefit the country in the long run leading to increased competitiveness and foreign direct investment.

Unfortunately, many analysts believe that the proposed reforms will be delayed, watered down or even abandoned altogether to avoid losing votes.

With the ethnic Chinese firmly behind the opposition Pakatan Rakyat, Barisan needs the votes of the Malays to shore up its flagging support base.

Rolling back the NEP at such a crucial juncture will definitely cause Barisan to lose the support of the Malays which may cause it to be voted out of office in the next general election due to be called by 2013.

Najib’s hands are tied out of political considerations to the detriment of the entire nation.

Malaysia will not be in such a conundrum if it had a strong and stable government like Singapore as well as a weak and non-existent opposition to create trouble for the ruling party.

Unpopular policies which are beneficial to the nation can be implemented swiftly on the ground without the lingering fear of losing votes in the next election.

Singapore’s economy took off between the years 1968 – 1980 when the PAP controlled all the seats in Parliament without a single opposition member.

Critical and sometimes painful decisions are made and policies implemented quickly and efficiently with no opposition from other parties.

For example, the Chinese language and vernacular schools were closed down and replaced by national schools during this period of time.

In Malaysia, this archaic system of education divided by language has remained because no Malaysian Prime Minister has the courage or determination to deal with the expected outcry from Malay rights groups and Chinese clans.

As such, Malaysia’s standard of education continues to lag behind Singapore to this very day.

Singapore does not have any natural resources like Malaysia to fall back on. That is why we need a strong and stable government to make quick and effective decisions for the good of the nation.

The present system has served us well for the last fifty years and has delivered unprecedented economic success and prosperity to our nation. Let us not go down the slippery slope of multi-party partisan politics which have ruined our neighbors like Thailand, Philipines and Malaysia.


http://www.temasekreview.com/2010/06/02/lessons-from-malaysia-why-singapore-needs-a-strong-and-stable-government/