ASHES TO ASHES, DUST TO DUST – TILL APEC, NEW MALAYSIA HELD TO RANSOM BY MAHATHIR: WILL 2020 SUMMIT REALLY BE HIS SWANSONG?

Malaysia is a trading country. Its Gross Domestic Product is slightly above one third of a trillion USD; which means Malaysia has a lot of room to grow. After all, Indonesia made it as a trillion dollar GDP. Although Indonesia has 10 times the population of Malaysia, Putrajaya is the first country in the Malay archipelago to have tackled poverty systematically and strategically.

Some policies such as the National Economic Policy (NEP) may have serious leakages, leading to corruption and false claims. Such as a freight transporter of the sugar trade to Sarawak. Instead of claiming one shipment has been made, reliable sources from anti corruption agencies across the country have detected multiple false claims. Making these false claims, it seems, have become more profitable than shipping the sugar to Sabah or Sarawak. Sometimes it is not the policy that is at fault, like the New Economic Policy. It is the implementation that scuttles the attainment of those lofty aims.

This year marks the coming of the Asia Pacific Economic Cooperation or APEC. While Malaysia would be the first country to host APEC twice in 22 years, the previous one in 1998, as reported by The Diplomat, Prime Minister Tun Dr Mahathir Mohamed is also determined to make it his swan song.

As after APEC, Prime Minister Tun Dr Mahathir Mohamed has decided to trigger the oft discussed leadership transition to Datuk Seri Anwar Ibrahim.

Of course, there are murmurs of discontent that the hand over should be May 2020. But this is more noise than anything else. Either way, the key is the free volition of both leaders to make Malaysia achieve great strides in international trade.

There are six reasons why Malaysia need to take APEC seriously, even though APEC is losing its steam. First of all, Hong Kong, one of the entities of APEC, would enter recession this year.

China’s economic growth is merely 6.1 per cent too not forgetting its US$2 trillion domestic debt bubble : while GDP of India’s has halved from 9 per cent to 4.5 per cent between 2015-2019, due to multiple reasons like demonetization and ongoing BJP led political instability.

Secondly, when the train ticket prices of Chileans were raised by a mere 4 cents, Chileans demonstrated in large numbers, leading Santiago, the capital of Chile, to cancel APEC altogether in November 2019. The cost of living in Kuala Lumpur remains high. There is no telling if Malaysians would challenge the utility of APEC too. Times are indeed hard on many countries that are members of APEC. Indonesia alone experienced a shortage of US$120 billion in tax collection last year, and roughly the same amount the year before.

Thirdly, the only bright spot is the US. The Wall Street has crossed the growth of 30 per cent last week, only the fifth time in the history of the US. Given the strength of US economy, Washington DC can decide to play coy. President Donald Trump who is up for reelection anyway won’t be able to make it to the APEC Summit again, indeed, third time in a roll. In other words, other than the US, almost all major powers are stuttering to a stop. Prime Minister Tun Dr Mahathir, for the lack of better word, has to make APEC work and Datuk Seri Anwar Ibrahim too, in order to maintain Malaysia’s status as a  trading nation.

Fourthly, it would be wrong to assume APEC is all about diplomatic pageantry and state ceremonies, where the leaders get to strut themselves like a peacock. In 1994, under the leadership of President Suharto of Indonesia in Bogor, the member states agreed to focus on the “sectoral liberalization” which permits each country to deregulate their economy sector by sector rather than at one go. Japan, US, China and all the rest were agreeable to this organic approach. If they had agreed once, a visionary Malaysia ln leaders can persuade them do it all over again.

Fifthly, APEC will involve all member states mindful of the trade and technology nationalism of US and China. Both countries have to be brought to bear to understand that any kinds of war will spook the market eventually, even if Wall Street alone is doing better the wall can crumble, as it once did in 2098-2009 global financial crisis.

Finally, the agenda of APEC has to lead the way for Regional Comprehensive Economic Agreement (RCEP) to become an important template, where India would not feel threatened by the economic prowess of China to subsidize it’s ways in all industries; a fear shared by the US and Japan. Malaysia must shape up or ship out, since some of the agendas would be carried over by what has been left behind by Chile when they canceled the Summit last November 2019. More importantly, Pakatan Harapan has to hold true to the work to reinvent Malaysia as Malaysia Baru based on open regionalism. Without the latter, Malaysia would be stuck in the rut. Putrajaya cannot get itself out of the Middle Income Trap, nor can it assure voters and investors alike that it capable of pioneering a new strategic break through for great and medium powers alike.

(Datuk Wira Dr. Rais Hussin Mohamed Ariff is the President/CEO at EMIR Research, an independent think tank focused on strategic policy recommendations based on rigorous research.)

MYSINCHEW

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