Here's a useful excursus on the impending GST regime done by KPMG.
Najib is quoted as saying that, "This will allow the public to give their comments, engage them, and if we find it necessary to fine tune it, we'll do so".
He stressed that if the government decided to introduce the GST in Malaysia, it would do so "very gently".
"It's not going to be an abrupt introduction," Najib said, adding that if the GST materialised, the rate would not burden the poor or middle-class Malaysians.
"And, it would not lead to inflation," he added.
Firstly, by tabling a Bill, the legislative process has commenced. There's a First Reading, then, there's a Second Reading and, then, a formal Third Reading whereupon the Bill becomes an Act of Parliament. The speed of the legislative process is at the discretion of the coalition in power.
A sincere effort at allowing public input should involve putting up the draft Bill in a suitable website, perhaps by the Treasury where comments can be received in an orderly fashion.
Tabling a Bill is a fait accompli which is, by definition, "an accomplished, presumably irreversible deed or fact".
Secondly, all consumption taxes has an inflationary effect even if it is a once-off effect.
Thirdly, "not be(ing) abrupt" is a relative view of the Prime Minister. If by "not be(ing) abrupt" he means that there will be lots of publicity about the Bill (and, therefore, following the reasoning, there should not be any psychological shock), then, he may be correct. But, the moment the Bill becomes an Act of Parliament and, it is given the Royal Assent and, is given a Commencement Date, then the implementation will still inevitably be felt by the public and the Malaysian economy as an "abrupt" phenomenon.
The question, therefore, is why the draft Bill should be tabled in Parliament when it can easily be posted at Treasury's website where public opinion can be sought for a period of, say, 6 months?
Dr Shahid, who is also World Bank economic adviser, defined innovation hotspots as urban areas that are a rich source of technological findings and has the entrepreneurship to convert some of these findings into commercial innovations. This is important to note.
Artificial innovation hotspots won't work
He made the disturbing and devastating observation that despite huge investments over the years to create such centres like Cyberjaya and Iskandar Malaysia, Malaysia has yet to produce these innovation hotspots. This is a clear indictment of the wrongheaded strategy pursued all along. The Malaysian government has been building, building and building hardware. There has been an utter disregard for the "software". Our education standards has declined appallingly.
So, can such an innovation hotspot be created? The short answer is “yes”, Dr Shahid said, but - and, please note this Najib and Idris Jala - it would probably take five to 10 years to achieve.
It would also require 3 things:
FDIs don't engender innovation
“Foreign direct investment can help, but thus far spillovers have been weak,’’ the good Doctor said. This is an indictment of MITI and MIDA. I've read their charter about technology transfers for years. Yet, there's nothing to show in the form of budgrafting any technological prowess to Malaysians.
What it takes to create innovation hotspots
A key ingredient to develop hotspots is to have centres of basic and applied research that generate surplus ideas and entrepreneurial talents to commercialise them.
Above and, absolutely beyond everything else is the quality of Malaysian education.
There's really nothing more important than education. Without education there is no thinking mind, no inquisitive mind.
But, education must encourage a culture of questioning, a spirit of inquisitiveness.
My concern is that our nervous Malaysian government is not confident enough and intelligent enough to open the Pandora's Box of academic freedom in local universities that will push young Malaysian minds towards an innovative mindset.
Without local unversities being permitted to push the envelope in all respects, not just in science, and technology but equally so in sociology, economics, socio-economics and political science - for, all these fields are interconnected - there will be no light at the end of the tunnel.
That is why I place some hope with what Idris Jala and his team are trying to do. And, I fervently hope that I'm not wrong to place some faith in them.
They have to review the University and University Colleges Act 1971 which has probably snuffed out 2 generations of potential. Is there a political will for this?
Mr Mohd Puad Zarkashi said employees in the private sector used English 99 per cent of the time and should switch to Bahasa Malaysia in order to show pride in the national language, the New Straits Times reported.
'This also occurs in government-linked companies where we have this weird culture of people speaking to each other in English instead of the national language,' he said at the launch of a linguistics seminar. 'We are polluting our own culture and identity as a nation,' he said.
'It would be difficult to strengthen the position of Bahasa Malaysia if this culture continued,' he added, urging Malaysians to emulate the French, Japanese and Koreans, who stuck to their own language.
The New Straits Times said Mr Mohd Puad also criticised young people for using a mix of English and Bahasa Malaysia in SMS text messages and on the Internet.He called on the nation's leaders to use Bahasa Malaysia for all meetings and events and said that when he receives letters in English he returns them and asks for them to be written in the national language.
'To reach the 2020 developed status, the World Bank is proposing a four-pillar strategy,' Mr Vikram Nehru, chief economist for East Asia and the Pacific, told reporters.
'Malaysia must specialise the economy further, improve the skills of its workforce, make growth more inclusive and strengthen public finances,' he told reporters at the launch of a report on the Malaysian economy.
The World Bank said Malaysia's economy will shrink 2.3 per cent this year but rebound to a 4.1 per cent expansion in 2010.
Mr Nehru said the South-east Asian economy was on track to grow between 5.6 to 5.9 per cent in 2011 and 2012.The report said Malaysia faced the challenge of shifting from an upper-middle economy to a high-income economy.
This includes the idea to overhaul the controversial Biro Tata Negara or National Civics Bureau that has been seen to be more of a propaganda unit, the possibility of a mediation council to handle disputes among different religions and making the government procurement process more transparent.
Government officials told The Malaysian Insider that these proposals are part of initiatives being pushed by Datuk Seri Idris Jala and a task force set up to promote 1 Malaysia, Najib's concept announced when he took the top job on April 3.
1 Malaysia is one of several laboratories set up to push through ideas on Key Performance Index (KPI) and National Key Results Areas (NKRAs) that Najib knows will be the tipping point in the general election.
His ruling Barisan Nasional coalition was badly beaten in Election 2008 under the leadership of former Prime Minister Tun Abdullah Ahmad Badawi when it lost four more states and 82 federal seats to give up its customary two-thirds parliamentary majority.
But his recent appointment of Idris, the former Malaysia Airlines managing director, to the Cabinet as Minister in the Prime Minister's Department to take charge of KPIs could help make the difference.
Idris has started his work by setting up labs outside the government administrative complex with select people to test out ideas and strategies to move Najib's 1 Malaysia concept
Arguably the 1 Malaysia lab is the most important now because Idris and his team are incubating ideas which touch on race, religion and other stumbling blocks to better race relations which have deteriorated over the years.
Last week, Najib and several key ministers were given a briefing on some of the ideas and many of the Cabinet ministers appeared supportive of some of the initiatives. Among the ministers in the visit were Deputy Prime Minister Tan Sri Muhyiddin Yassin, Higher Education Minister Datuk Seri Khaled Nordin and Minister Datuk Seri Nazri Abdul Aziz.
It is understood that the lab felt the Biro Tata Negara needed a complete makeover to promote inclusiveness. Several young Pakatan Rakyat leaders have complained it was "brainwashing" students who were taught to hate opposition parties.
What is clear is that Najib remains Idris' strongest ally and is willing to push the envelope for changes in the government. Several Umno ministers are also more supportive of change than before, government officials said.
"Idris and his team's biggest task will be presenting their ideas at a Cabinet retreat next month. If there is buy-in, some of the biggest bugbears in our country will finally be addressed," one government official told The Malaysian Insider.
An analyst with knowledge of the 1 Malaysia lab activities concurred.
"If these initiatives are endorsed by the Najib administration and implemented, they could pull the carpet from under the Pakatan Rakyat," the analyst told The Malaysian Insider.
He said the key would remain in the implementation and also acceptance by the civil service.
2. Education Matters
On a recent Saturday afternoon, at a nice restaurant in central Shanghai, Liu Zhi-he sat fidgeting at the table, knowing that it was about time for him to leave. All around him sat relatives from an extended family that had gathered for a momentous occasion: the 90th birthday of Liu's great-grandmother Ling Shu Zhen, the still spry and elegant matriarch of a sprawling clan. But Liu had to leave because it was time for him to go to school. This Saturday, as he does every Saturday, Liu was attending two special classes. He takes a math tutorial, and he studies English.
Liu is 7 years old.
A lot of foreigners — and, indeed, a fair number of Chinese — believe that the obsession (and that's the right word) with education in China is overdone. The system stresses rote memorization. It drives kids crazy — aren't 7-year-olds supposed to have fun on Saturday afternoons? — and doesn't necessarily prepare them, economically speaking, for the job market or, emotionally speaking, for adulthood. Add to that the fact that the system, while incredibly competitive, has become corrupt.
All true — and all, for the most part, beside the point. After decades of investment in an educational system that reaches the remotest peasant villages, the literacy rate in China is now over 90%. (The U.S.'s is 86%.) And in urban China, in particular, students don't just learn to read. They learn math. They learn science. As William McCahill, a former deputy chief of mission in the U.S. embassy in Beijing, says, "Fundamentally, they are getting the basics right, particularly in math and science. We need to do the same. Their kids are often ahead of ours."
What the Chinese can teach are verities, home truths that have started to make a comeback in the U.S. but that could still use a push. The Chinese understand that there is no substitute for putting in the hours and doing the work. And more than anything else, the kids in China do lots of work. In the U.S., according to a 2007 survey by the Department of Education, 37% of 10th-graders in 2002 spent more than 10 hours on homework each week. That's not bad; in fact, it's much better than it used to be (in 1980 a mere 7% of kids did that much work at home each week). But Chinese students, according to a 2006 report by the Asia Society, spend twice as many hours doing homework as do their U.S. peers.
Part of the reason is family involvement. Consider Liu, the 7-year-old who had to leave the birthday party to go to Saturday school. Both his parents work, so when he goes home each day, his grandparents are there to greet him and put him through his after-school paces. His mother says simply, "This is normal. All his classmates work like this after school."Yes, big corporate employers in China will tell you the best students coming out of U.S. universities are just as bright as and, generally speaking, far more creative than their counterparts from China's élite universities. But the big hump in the bell curve — the majority of the school-age population — matters a lot for the economic health of countries. Simply put, the more smart, well-educated people there are — of the sort that hard work creates — the more economies (and companies) benefit. Remember what venture capitalist Tam said about China and the electric-vehicle industry. A single, relatively new company working on developing an electric-car battery — BYD Co. — employs an astounding 10,000 engineers. China, critics will point out, doesn't produce (at least not yet) many Nobel Prize winners. But don't think the basic educational competence of the workforce isn't a key factor in its having become the manufacturing workshop of the world. It isn't just about cheap labor; it's about smart labor. "Whether it's line workers or engineers, we're finding the candlepower of our employees here as good as or better than anywhere in the world," says Nick Reilly, a top executive at General Motors in Shanghai. "It all starts with the emphasis families put on the importance of education. That puts pressure on the government to deliver a decent system." And the Chinese government responds to that pressure in some intriguing ways. It insists that primary-school teachers in math and science have degrees in those subjects. (Less than half of eighth-grade math teachers in the U.S. majored in math.) There is a "master teacher" program nationwide that provides mentoring for younger teachers. Zhang Dianzhou, a professor emeritus of mathematics at East China Normal University in Shanghai who co-chaired a committee charged with redesigning high school mathematics programs across the country, says recent changes have begun to reflect more of a "real-world emphasis." Computer-science courses, for example, have been integrated into the math curriculum for high school students. And China is placing even more importance on teaching young students English and other foreign languages. If you think China's willingness to constantly fine-tune its educational system is not going to have much of an impact 20 years from now, there's a 7-year-old boy in Shanghai who'd be happy to discuss the issue with you. In English.(emphasis mine)
The two countries will work on railway, bridge, water and energy projects as China imports more Malaysian palm oil and timber, according to memorandums of understanding signed on the final day of President Hu Jintao’s state visit to Malaysia.
“We are looking at advancing strategic cooperation in all fields,” Hu told reporters after meeting Malaysian Prime Minister Najib Razak today in the administrative capital of Putrajaya, about an hour’s drive from Kuala Lumpur.
China is the world’s largest edible oil importer. The resource-hungry nation bought 357,570 metric tons last month from Malaysia, the world’s No. 2 palm exporter of the crop. Beijing has been scouring the world for natural resources to feed an economy that has grown at least 6 percent annually since 1997. In return, it has pledged financing and help with construction of infrastructure.
“China’s appetite for commodities is almost unquenchable,” said Dorab Mistry, director of Godrej International Ltd. “We expect growth of consumption per capita of between 3 and 4 percent in China even now, they will continue to be a very good buyer of Malaysian palm oil.”
The Malaysian government is opening up to more business from China as data from the Statistics Department showed that from January to September this year, China is the second-largest market for Malaysia’s exports valued at 46.8 billion ringgit. Malaysian exports to China jumped 16 percent last month from a year earlier, figures released in Beijing today showed.
Malaysia will work with Chinese companies to build a dam in Penang state, Najib said. The Mengkuang Dam will be the biggest in the area with a storage capacity of 23,639 million liters of water, supplying both Penang and surrounding areas.
A Chinese company will be awarded a contract by the Malaysian government to help develop a double-track railway that will run from Johor Bahru, bordering Singapore, to Gemas in the state of Negeri Sembilan, Najib added. Global Rail Sdn. is leading the construction of the 28 billion ringgit ($8.2 billion) project, Malaysia’s Business Times reported on Oct. 8.
Malaysia will also work with Chinese companies to build a pulp and paper mill and aluminum smelter in Sarawak state, Najib said, without naming of the China businesses that will be involved in these projects.
Export-Import Bank of China, a state export credit agency, signed a credit agreement with Jambatan Kedua Sdn. for a second bridge linking Penang Island to the Malaysian peninsula. Jambatan Kedua is building the superstructure for the bridge for main developer UEM Builders Bhd.
Meanwhile, Beijing Enterprise Water Group Ltd. will work with the Malaysian government to improve the country’s sewerage services, according to one MoU signed today.
Hu last visited Malaysia in April 2002 when he was China’s vice president, Malaysia’s foreign affairs ministry said in a statement dated Nov. 6. Malaysia started diplomatic relations with China in 1974.
Improving the quality of national schools will solve that and provide myriad other benefits too.
WHEN the founding fathers agreed that vernacular and religious schools should exist alongside the national school system, they had no idea of the kind of problems it would give rise to.
They had no idea that it would help to polarise the education system so much that many Malaysian school children will go to schools based on their racial and religious heritage, and have little interaction with students of other races.
They had no idea that, especially in primary schools, there would be very little intermingling of children of different races, seriously exacerbating the problem of a lack of national unity.
While at the time of independence those who wanted their children to do well sent their children to national schools, these have now, along with religious schools, become largely the preserve of Malay children.
While national schools were once considered centres of excellence, their quality of education has deteriorated over the years leading to a mass exodus of non-Malay students to vernacular schools, while more religious Malays opt for religious schools. Those who can afford it opt for private education.
While national schools, because of their quality and open nature, were at one time considered natural choices for most Malaysians, well over 80% of Chinese schoolchildren and a significant proportion of Indians go to vernacular schools for their primary education.
At secondary school level, some of those in the vernacular and religious schools do come into the national school stream but by then, because of their experience in their formative years, they do not mingle as much as their parents did.
The problem gets worse at tertiary level, with government universities populated largely by Malays while private colleges and universities are dominated by non-Malays.
Some non-Malays could not gain admission to government universities and others, both Malays and non-Malays, feel the quality of local universities has fallen and want international recognition for their degrees.
Without doubt, the problem originated from one single cause – the massive deterioration of the quality of the teaching in national schools.
This was made worse by the perceived “Islamisation” of many national schools, which made non-Muslims uncomfortable about sending their students to these schools.
Well-funded Chinese schools with better infrastructure and dedicated teachers developed a reputation for quality, rigour and working their students hard.
That eventually led to most Chinese parents sending their children to these schools.
All these have left Malaysia in rather poor circumstances – it may well be the only country in the world with a fragmented educational system.
It has a peculiar set of problems which is rather difficult to overcome.
First, the move to a single stream cannot be compelled because vernacular and religious schools are guaranteed under the Constitution. Even if consensus can be reached to move to a single stream, there are other questions.
How would one ensure that mother tongue education continues unabated?
If, as is most likely, consensus cannot be reached, imaginative ways have to be thought of to overcome these problems.
Vision schools, where vernacular and national schools are located close together and some activities integrated, are likely to be of only limited help because it won’t be physically possible to put most schools close together.
Sports may help, but if you have teams largely comprising single races, that could make things worse rather than better even if there is interaction among the players.
Consensus on a single stream is best, and perhaps we need someone of stature to go around and build such a consensus from various community leaders. But it is a tough task.
The precursor to that consensus is safeguards to devote enough time and resources to mother tongue education in schools to ensure that language and cultural heritage are not lost, and a monitoring and corrective mechanism in which all will have faith.
Ultimately, even if vernacular and religious schools are present, national unity aims will be better served if you simply move more students and eventually most students of all races into national schools.
There is only one way that can be done short of a single stream.
That is simply to improve the quality of the national schools, so that they are better than the others and to make Malaysians of all races equally welcome in those schools.
Nobody is pretending that this is an easy task. But it may be easier to do than to obtain a consensus on a single stream.
And there are other attendant benefits. If the national educational system improves, so will the population. The opportunities that it will present to all equally will close the gap between the races and the rich and the poor.
It will lead to a better quality workforce, a greater social conscience, excellence, more moral behaviour - and better quality leaders.
The icing on the cake is that an improved national school system will also improve national unity.