Political uncertainties not a factor in Bursa

You've got to listen to Mark Mobius when he says something. He's been in charge of Templeton Asset Management for Asia's emerging markets for quite a while. He's usually very candid because he manages a huge investment fund. Close to US$30 billion (RM108 billion) in assets.

So, this time around, Mark Mobius has made the observation as reported in the Edge Daily, that against the backdrop of a volatile trading environment and global economic downturn, the Malaysian market presented investment opportunities because of attractive valuations and its steadiness compared with other markets.

"The Malaysian stock market has not gone up as much as other emerging markets in general. Neither has it gone down as much, so the market tends to be steadier in that sense," he is quoted as saying.

Mobius also said that the political uncertainties in the country would not have a significant impact on the stock market.

He observed that the government institutions are in place and it will continue to operate no matter who is in power. He reckoned that the market will take a life of its own. He was of the view that share valuations in many cases in Malaysia are attractive so there are opportunities to come in, buy and invest.

Now that's a qualified thumbs-up for Malaysia from Mobius.

But, we cannot overlook the fact that Templeton has had some discomfitting exposure to Satyam, the Indian IT outsourcing company which is mired in a financial scandal which may account for Mobius's unusually generous comments about Malaysia. Usually he's not that generous.

Still, if Mark Mobius is correct in saying that politics is not a factor that drives the market sentiment at Bursa Malaysia then, what does drive the recent negative sentiment?

Could the negative market sentiment possibly have a probable link to the putrefying state of the real economy?

Just, maybe?

Innovation disconnect

I couldn't help shaking my head and sighing as I read the NST report entitled, Biotech grants going to waste? It just confirms what we've all feared.

There is a seriously lackadaisical attitude in the approach that Malaysian government agencies, which includes public universities, take when handling taxpayers' money. Get this portion of the report; out of the 5,232 R&D projects implemented under the Seventh and Eighth Malaysia Plan, only 5.1 per cent were considered as having commercialisation potential. Picture on the right courtesy of NST.
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Knowledge for knowledge's sake can be a wonderful thing. It is a hallmark of many great tertiary institutions. But this is quite different. It is different because this particular issue involves a deliberate process where taxpayers' money is allocated in the form of grants to public universities to finance the undertaking of R&D projects.

So, if the Biology Department of a public university wants to study the mating habits of worms, it surely can't be for any genus of worms. The research scope should zoom in on the types of worms that has a salutary effect on agriculture. And, not just any area of agriculture but a specific crop. Otherwise, it's just a waste of taxpayers' money.

It's different if you don't use taxpayers' money. For example, Miriam Rothschild, scion of the English branch of the fabulously wealthy Rothschild family was an avid entomologist. She could self-finance her passionate research into and, compiling a veritable taxonomy of insects, thereby, advancing human knowledge of this area of biology.

But, the R&D in Malaysia's public universities do not have such luxury. Therefore, there must be accountability in using taxpayers' money. All R&D proposals must have clear objectives that must pass muster with commercial needs.

Alas! I am reminded of Juvenal's maxim, quis custodiet ipsos custodes (who will guard the guards themselves?).

This seems to be a problem that dogs the public sector in Malaysia.

Ku Li: Malaysia's economic State of Play

After re-reading in The Edge, Tengku Razaleigh Hamzah's speech entitled Restoring Confidence at ASLI's 11th Malaysia Strategic Outlook Conference 2009, I have to borrow wholesale, the text of that speech from Another Brick in the Wall's blog.

Ku Li's speech examines the current government's reticence on addressing the forthcoming economic challenges. He touches on Malaysia's past competitive strength and expresses concern with Malaysia's current economic position on laggard productivity and lack of competitiveness.

True to form, Ku Li does not leave us with a sense of nostalgia about the possibilities for Malaysia if this former Minister of Finance is given a future role in nurturing Malaysia's economic health and nudging our economy towards a more positive strategic direction. Instead, he leaves us at the end of his speech with two interesting strategic goals.

This is one speech that is worth reading line-by-line instead of a quick skim. A cursory read does not do justice to to the incisive thoughts and deliberate emphasis that Ku Li has given to the country's current crop of economic managers. Read on.  

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A problem of confidence

The present financial crisis started in a speculative housing bubble in the US, inflated on greed and irrational confidence. Shady practices went mainstream under the wing of weak financial governance. When the bubble burst, gold-plated names on Wall Street were implicated. A massive loss of confidence in the financial sector has crippled credit flow worldwide. Consumption has contracted as households put off expenditure out of uncertainty. Investment has retreated. There has been a massive loss of confidence.

2. Expectations are a central factor in macroeconomic booms and busts. If a sharp loss of confidence is an endogenous part of the problem, a restoration of confidence must be the beginning of the solution. However, if we have learned anything at all from the crisis, this cannot be hollow confidence, but confidence based on a clear appreciation of our prospects. The lesson of the global economy is that false confidence based on irrational hope leads to collapse, disillusionment and pessimism.

3. We need a sound appreciation of our reality before we can dream of changing it. We need to face harsh truths before we can believe in ourselves and inspire others to believe in us. In coming to that sound appreciation here in Malaysia we have run out of time for politically manipulated messaging and sugar coated evasions.

4. Let us just begin by acknowledging that we will not be spared the effects of the global economic crisis.

5. Our leaders only undermine the government’s credibility when they paint an alternative reality for us.

I understand we don’t want to frighten markets and voters unnecessarily, but we do not live in an information bubble. Only the most resolutely ignorant can now pretend that all shall be fine while the rest of the world deals with what Jeffrey Sachs has called “a world economy teetering on the brink of unprecedented catastrophe.”  Leaders who deny the seriousness of the crisis only raise the suspicion that they have no ideas for coping with it. They undermine the government’s credibility when that very credibility, that confidence, is a key issue.

6. We are a trading and exporting nation. While we were relatively shielded from the first wave of financial failures there is no escape from the sharp demand slump in the global economy. The Government and Bank Negara maintain that our growth rate this year will be 3.5%. I fear it could be well under that. The latest numbers show a plunge in industrial activity, with manufacturing output in November, down 9.4 percent from a year ago. December may well be worse. Exports are down. There has been a dramatic swing in the balance of payments to a RM31 billion deficit in the third quarter, from a surplus of RM26 billion in the second. Anyone looking at the size of the downturn and at its swiftness can only wonder if we will be sailing through. This crisis really “went global” only in the final quarter of last year, but within that single quarter manufacturing both here and in Singapore contracted by more than 10 percent on the previous year. Policymakers in Singapore appear far more alarmed than our own. After having declared a recession, they found that the effects of the crisis were far worse than they thought. We are just at the beginning, and the bottom is not yet in sight.

7. Three and a half percent growth, even if we achieve it, will not create enough jobs to employ the large number who enter the workforce each year from our young population. Given our demographic profile and the fact that we are an oil exporter, our baseline do-nothing growth figure is not 0% but closer to 4%.

8. We do have a problem. Now we need to acknowledge that we are not in good shape to deal with it. After early decades of rapid progress, it looks like that economic growth has flattened, our public delivery system calcified and our economic leadership run out of ideas.

The financial crisis in the context of our developmental path

9. Malaysia is squeezed between being the low cost manufacturer we once excelled as, and the knowledge-intensive economy we are failing to become. Our years of sustained high growth ended in 1997 with the Asian Economic Crisis. With the subsequent rise of China and India as low cost producers with giant domestic markets, the manufacturing sector which propelled that growth is being hollowed out.

10. We are in the infamous “middle Income trap”. No longer cheap enough to compete with low cost producers and not advanced enough to compete with more innovative ones, we find ourselves squeezed in between with no economic story. Successful economies, like successful companies, need a compelling story, and we don’t have one. With falling communications and transport costs, the skilled engineers, managers and designers of the rich countries are pairing themselves to the cheaper labour of poor countries to extract productivity and cost benefits. The global integration of labour markets favours both rich and poor countries and stagnates the wages of those in the middle that are neither smarter nor cheaper. That means us. Our working people have suffered stagnant wages and a rising cost of living.

11. According to the World Bank, Malaysia’s share of GDP contributed by services was 46.2% in 1987. How much did you think it was twenty years later in 2007? 46.4%.

How much do you think the real wages of our workers grew between 1994 and 2007? By 2.6% in the domestic sector and by 2.8% in the export sector.

Unskilled migrant workers, documented and undocumented, make up 30-40% of our workforce. Meanwhile, alone in East Asia, the number of expatriate professionals here has decreased. Alone in East Asia, private sector wage increases follow government sector increases, not the other way around.

Did we have to learn about this from the World Bank? What has the EPU been doing? Has the cabinet pondered these numbers? Have we had a national discussion about what this?

12. The only long term path to prosperity is increased income through increased productivity. Sustained productivity growth is the engine of China’s unbroken run of high growth. Our failure to increase productivity and working incomes has been masked by an influx of cheap labour. That cheap labour has become another crutch for us.

13. Low growth

a) The other thing masking our underperformance over the last decade is the fact that in this time the world economy has experienced its biggest expansion in recorded history. We have averaged 4 to 5 percent growth throughout a historic boom over which world economic growth has averaged 4.5 percent. Meanwhile the two most populous nations in the world have been growing at or near double digit rates, multiplying per capita incomes and lifting hundreds of millions out of poverty in the greatest expansion of human welfare in history. That boom is over and we have missed it.

b) By analogy, when we view the report cards of our own children, we set our expectations against what they have been given and what they were capable of in the past. Turning to our own country, so richly endowed with natural and cultural resources, a stable society and good institutions, we see a failing report card. Instead of educating our young to be competitive we have turned out large numbers without the skills and attitudes suited for basic work, let alone for the global economy that is not out there somewhere but on our own shores. Each decade we have discovered new ‘peer-countries’ against whom we might look decent because we have fallen out of the league of the last set of peers. We fail to notice we have been relegated. Remember that in the 60’s we were classified with Taiwan and Korea, in the eighties with Singapore and Hong Kong. Now we are less “relevant” than Vietnam as an investment destination. I remember receiving delegations from Taiwan and Hong Kong who came to learn from us.

14. Inequality

We cannot comfort ourselves that we have sacrificed growth for social equity. Despite the strong redistributive measures the government has pursued for decades, our Gini coefficient, the standard measure of inequality, has been ballooning. In this region only Papua New Guinea is more unequal. We have the most unequal income distribution in Southeast Asia. If there is supposed to be a trade-off between growth and equity, we have not made it. We are failing on both growth and equity.

15. What does it take to make the leap from middle to high income? The countries that have done it recently, Korea, Taiwan, Hong Kong and Singapore, have one feature in common: they were able to learn from previous crises. Without a buffer of natural resources, each of these economies was more exposed than we were. In relative terms, because they are even more trade oriented than we are, each may be harder hit by this downturn than we are. But we miss the picture if we stand by and comfort ourselves that we are ‘shielded’ because our capital markets have been less open. Our very problem may be that we have been shielding ourselves from learning, which requires systematic change in behaviour or knowledge informed by experience.

16. The criterion of success for making the developmental leap, the key differentiator between the leaders and the also-rans, is not immunity from economic crises (after all, if you have a Stone Age economy, you are completely immune) but the organizational capability of governments to learn and re-organize around new national economic strategies through these crises. Each major crisis is either an important opportunity to transform the economy or a major setback to our ambitions. The question is whether our policymaking and policy implementing apparatus is set up, motivated and led to learn from this crisis. It is a question of the capability of government and governance.

17. We must also retrain and re-skill those who lose their jobs because of this crisis. This cannot be done in the present ad hoc manner. It must be a coordinated program, with courses matched and tracked to learners according to a National Skills Plan which in turns supports a vision for the Economy. Those lost jobs, especially in the manufacturing sector, will not be coming back. We better have a plan and a vision.

18. What are the consequences of sailing into an economic storm in our present condition, after a decade of lacklustre performance and with no plan, no vision for sustained high growth? We can look at two scenarios: breakdown or relegation.

a) Breakdown

As a developmental state, the legitimacy of our government is based on its guarantee of social peace and economic development.

As Professor Clive Kessler has observed: “Social peace in Malaysia depends upon the continuation, and the continuing expectation, of economic growth and prosperity; while economic growth and prosperity depend upon the continuation and assurance of social peace.” This reciprocal relationship between peace and growth makes us prone to a vicious feedback cycle: if either engine were to fail, the other would fail with it, and take us down a spiral of failure with a painful end. Our margin for error is slimmer than we think. Our socio-political setup implies that we don’t have a smooth glide down to complete irrelevance. Like a bicycle or an airplane we need to be running at a certain speed to avoid falling off.

b) Relegation

On a second scenario we might just coast through the downturn. However we will emerge with an economy that has failed to gear up to the demands of the global economy, fallen yet further behind along our developmental path and locked ourselves tighter into a long term pattern of low growth. Sooner or later will come that painful reckoning described in the first scenario. We should view the crisis in the context of our history as a young nation. The last time the world faced a contraction of this size Malaysia did not yet exist. The crisis is has broken out at a critical point in the development paths of our economy and our political system. Put these three factors together, and we have a perfect storm: an unprecedented need for leadership at just the moment when our system for selecting and legitimizing political leadership appears to be broken.

Where next

20. My reading of where we stand may seem harsh, but perhaps the world is harsher. I don’t wish to offend, but I believe we need to grasp the peril of our situation clearly before we know what to do next.

21. In the medium term we need to make a developmental leap. But a leap is not a straight-line projection of the present. It is not about doing more of what we have done. We are not going to get there putting up more highways, declaring more Growth Corridors or planting more oil palm. The way up is a complex achievement that in turn depends on transformative improvements in governance and a successful reform of our political system.

22. The world recession is a critical opportunity for us to re-gear and re-tool the Malaysian economy because it is a challenge to take bold, imaginative measures. It lights the fire under our feet to make transformative improvements in governance and politics. It also demands that the government spend boldly on the right things, in the right way, to stimulate demand.

23. Two criteria for ‘the right things” would be those public investments with the widest multiplier effects, over the short and the longer term. Over the short term, there are often tradeoffs between impact on demand and on improved economic capacity. Over the long term, the two are the same. The “long term multiplier” is nothing less than the improved capacity of the entire system.

24. So we must think carefully about what we spend the “fiscal stimulus” on. There is no such thing as a free lunch. We will be going into deficit to finance this stimulus, so it can’t be about just spreading money around. So far there has been no impact from the stimulus package announced in November, nor was it clear what the economic thinking was behind that measure.

25. We don’t need another stimulus “package” of spending here and there. What we need, and what the crisis gives us a chance to implement, is a set of bold projects with an economic story behind them to help Malaysia make the developmental leap we have been missing. We have a once in a lifetime economic challenge. We must meet this challenge with a historic sense of purpose. That means, not with a “stimulus” consisting of ad hoc pork barrel expenditures but a set of public investment projects guided by a vision, designed around a strategy and governed with bullet-proof integrity.

26. Let me suggest two programmes and an enabling set of reforms.

Oil and Gas Centre

27. Oil and Gas has served us well, but we have still not tapped our strategic strength in this sector despite our unmatched natural and strategic advantages:

a) Malaysia is the leading Oil and Gas producer in the region. Our proven reserves have been augmented by major discoveries in recent years.

b) More than half the world’s annual merchant fleet tonnage passes through the Straits of Malacca, with most of it continuing into the South China Sea. Oil flows through the Straits of Malacca are three times greater than that through the Suez Canal and fifteen times greater than flow through the Panama Canal. We live alongside the most important oil shipping route in the world. Our fifteenth century ancestors may have done more to tap that advantage than we.

c) We have in Petronas one of the leading oil companies in the world.

d) We have strong trade links to Middle Eastern oil producers.

28. We could do much better. Consider that despite having no oil resources, Singapore is among the top three global players in trading, refining and manufacture of oil and gas equipment.

29. Three years ago, while Malaysia still held the OIC chairmanship, I proposed a National Strategic Plan with the vision of developing Malaysia into Asia’s Oil and Gas centre, with leading capabilities in refining, shipping, distribution, storage and downstream production.

30. We should develop offshore storage facilities for other producer nations with high country risk. Oil and gas exploration, extraction and production are increasingly technology driven, high value operations in themselves as oil becomes scarcer. There will be large payoffs for having our own R&D capability in exploration, extraction and production. We should specialize in energy technology, including alternative energy sources for a carbon-constrained future.

31. We should form partnerships along the value chain. These could include a network of agreements with Gulf producers and with major consumers to improve oil security. We could form G-to-G partnerships in ASEAN, provide tax incentives and craft innovative Production Sharing Contracts,

32. Here’s the exciting thing. For all these ventures to work we need greatly improved capabilities to finance and trade oil and gas. Given our very special geographic and strategic advantages, we should build the first spot and futures Exchange for Oil and Gas in an OIC nation.

33. Whatever the government chooses to do, it should understand that for us to get on a higher growth plane we must specialize, and we must have a government capable of providing the direction, drive and executive capability to foster that specialization. Globalisation requires a relentless focus on competitive advantage. We need our own story.

Housing

34. Let’s start a program to bring home ownership to the whole country. The construction sector creates multiplier effects in more than a hundred other industries. It provides work in everything from insurance to advertising to materials supply. Of all the national projects we could undertake, few could have such a large social as well as an economic multiplier effect.

35. Housing builds powerful social capital and gives substance to citizenship. A national housing project allows us to design entire communities and townships with their transportation, communications, educational and recreational infrastructure with a strong set of standards and social objectives. It lets us plan the housing stock to cater to the lifecycle of home ownership, with a good mix of options for different localities and life-cycle requirements. It is a way to grow racial harmony, build integrated schools, and help the poor without creating a crutch.

36. Let’s commit ourselves to having each and every Malaysian family own their own home. This vision is a radical challenge to the nation to do better. It will require extraordinary improvements in our ability to design, construct and finance housing projects. It will require the setting up of a statutory board to oversee housing development, administration and management. As land governed by the State powers, the States will have to implement these projects. This will require, and hopefully force, improved coordination between the Federal and State governments, especially now that we might no longer expect that the same party is in power in both places.

37. Financing for this investment could come from modifications to EPF, with matched contributions from the government towards the value of the property. Because it comes out of savings, this spending would be non-inflationary. I can think of few better ways to get the economy humming again, give our citizens a focal point of hope and pride, and weave a safety net that also encourages savings and enterprise.

Public sector reform

38. We cannot wait till the crisis blows over to tackle the public delivery system head on. This is because we will need an upgraded public service just to implement such large public programs successfully.

39. The need for improved governance is greater, not less, in challenging economic times. When Franklin Delano Roosevelt implemented the New Deal to push America out of the Great Depression, many feared that this would present a huge opportunity for graft. Confounding these expectations, the New Deal programmes were implemented with unprecedented transparency. FDR did this by building oversight into the implementation of his rescue program.

40. Similarly, the two programmes I have suggested would come to nought if they were derailed by the corrupt practices that have become the norm in this country. Instead of rescuing our economy they would become millstones around our neck. As part of the project management of these programmes we should set up powerful, independent divisions devoted to investigating complaints of fraud.

41. Today the role of the public sector is a lot more complex than anyone could have imagined even a decade ago. A “public delivery system” that was designed for the challenges of the 1950’s cannot possibly cope with the complex demands of the globalised 21st. The current crisis propagated worldwide in internet time as regulators scrambled to catch up. Government now needs to be smarter, tougher and more responsive than before to engage on equal footing with business. We need leadership to change the operating model of the civil service from last century’s centralized planning approach, driven by budgetary plans, to a model of government as facilitator, aggregator and convener of business. Government that targets economic outcomes rather than accounting quotas.

42. We need to demand as much talent and organizational ability in our public service as the private sector does of its own people. Today the quality government is a core component of national competitiveness. However there is nothing strange about the expectation that the civil service should be a high performing organization led by an intellectual elite. It is how the Malayan Civil Service used to operate. Many of us remember it.

CONCLUSION

43. What I have outlined this afternoon are just my suggestions. I am sure there are many other ideas in this distinguished company.

44. Let me end where I began, with the question of confidence.

45. We need to restore confidence in our basic institutions, our leadership, the integrity of the Federation, the rule of law and our national Constitution. This is of a piece with the vital economic confidence needed to unleash credit, investment and consumption, and get everyone working. We need to restore confidence in Malaysia.

46. Real confidence is hope based on an apprehension of the truth. It is social capital and trust in society and its future. It is inspired by leaders willing to take us through an unflinching evaluation of where we are today to a vision of what we are capable of tomorrow. It means owning our own story and banking on it.

47. The country can no longer afford a political class out of touch with reality that trades on yesterday’s political insecurities and a government that has forgotten its purpose. We need a renewal of leadership as a first step to restoring true confidence.

48. The economic statistics are mere indicators of the activities and expectations of the unique national community we are trying to build, so that building an economy and building a nation, providing good governance and being truthful, are not things that can be achieved apart from one another. To reignite our confidence would be to revitalise the project of building Malaysia.

Ku Li: GDP not at 3.5%

Malaysiakini carries an interesting report where former Finance Minister Tengku Razaleigh Hamzah joins in the widely-held view that the GDP forecast of 3.5% growth for 2009 is too bullish. Ku Li reckons the Citigroup analysis, that GDP growth may be closer to 0.5%, is most accurate.

It is easier to extract relevant portions of the Malaysiakini report for your reference even though the full report contains far more of Ku Li's always-interesting views on the economy:

Earlier in his keynote address, Razaleigh, who is also Gua Musang MP said the government should “come to its senses and stop being in denial” about the global recession by laying bare the RM7 billion stimulus package and where the money is channelled to.

He said a “proper assessment” of the package should be made known even before having the stimulus package in the first place.

“The government should come out and start telling people the truth so that the people can prepare themselves to brace the economic crisis,” he said.

Razaleigh stressed at the press conference on the RM7 billion stimulus package and that the government should find ways and means to spend the money wisely.

“If you think RM7 billion is not worthwhile, then what is worthwhile? Can't you do a proper assessment of the situation? How deep is the recession? How much is really required? 

“If you say RM20 billion, alright. Find ways and means to spend that to help the country and the people, especially the low-income (earners),” he said.

Courtesy of walla you can read Citigroup and Deutsche Bank analyst reports by clicking on the names.

Blogger Another Brick in the Wall has the full text of Ku Li's speech at ASLI's 11th Malaysia Strategic Outlook Conference 2009 here.

More stimulus and rate cuts expected

The latest forecast offered by MIER, as reported by Bloomberg, is that Malaysia's economic growth for 2009 will be in the region of 1.3% GDP growth. This is lower than the 3.4% GDP growth that MIER itself forecasted in December 2008.

This is one of the hazards of economic forecasting since it deals with historical numbers from previous quarters. Still, we cannot ignore the downward trend in projections. 

To digress a little and, yet, on point, this morning I interviewed a job applicant who is in her 40s who had been laid off her previous job. She told me that her previous employer, a Malaysian SME involved in the importation of certain goods, is in the process of shutting down. I established from the chat that the impending closure of that business was due to 2 things. First, sales orders fell precipitously. Second, there was a competing product that was gaining market share. So, the impending closure has something to do with the contracting economy but, the decision was also affected by competition factors.

More stimulus may be needed

By MIER's reckoning, a second stimulus package, equal to the RM7 billion first package, is likely to be required.   

Borrowing costs to be cut by another 50 basis points (0.5%)

Consistent with what this blog has called for previously, MIER is expecting Bank Negara to cut bank borrowing costs (the so-called overnight policy rates) by 50 basis points. This is usually translated into lower lending rates at the retail lending level, which should help the SMEs and other borrowers.

More deficits in fiscal budget 

Unfortunately, the government's stimulus package(s) is required at a time when Malaysia's biggest income source, crude oil, is declining in value. This has led MIER to revise the 4.8% of GDP deficit in 2009 to a higher deficit estimate of 5.5% of GDP.

A take on Bursa Malaysia

For all it's worth, those who have some exposure to shares in Bursa Malaysia, may be interested in the ominous view held by Deutsche Bank's latest report, that the Malaysian stock market has yet to price in a worsening economic climate including the risk of a technical recession. As noted by the Edge Daily, quoting a research house, a technical recession is a situation when there are two consecutive quarters of negative GDP growth.

A step in the right direction

The MIRC Micro Financing Expo (reported here) which is an initiative under Bank Negara’s Pembiayaan Mikro Scheme is a small step in the right direction in the wake of forthcoming economic challenges.

The Bank Negara Scheme allows micro enterprises to obtain financing from RM500 to RM50,000 for working capital or capital expenditure.

I have previously blogged about microfinance here.

The Dayak Dilemma (Part 3)

This is the third instalment of Sim Kwang Yang's Dayak Dilemma series in Malaysiakini. In this instalment Sim traces the changes made to the role of the Tuai Rumah or Tua Kampung in villages that dot the Sarawak landscape.

Sim's piece quotes generously from the very wise, articulate and knowledgeable blogger, Joseph Tawie, whose blog The Broken Shield I discovered many, many months ago.

(Pic) Mr Johnny (right) and Mr Joseph both proudly holding a book that they respectively authored - "The Broken Shield - The Birth of Dayakism" & "Gempung Jerita Tuai Bansa Iban". Picture and caption from here.

I need to digress a little to make the observation that Joseph Tawie's writings on Sarawak, and the land, cultural and economic issues challenging the Dayak community in Sarawak, are always infused with dignified and considered reasoning set within a rich vein of wisdom as only age and life experience can give. Top all that with highly-readable prose and, we have a blog that is truly worthy of reading.

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Not surprisingly, Joseph Tawie has published a book entitled The Broken Shield and, according to Sim, he is in the process of publishing a follow-up book, The Broken Shield Part Two - The Dayak Dilemma which sounds like a companion volume to the first book.

Now, back to Sim's piece. He traces the slow, but sure, emasculation of the role of the Tuai Rumah from that of an avuncular community leader that commands the respect of the villagers by virtue of his deep knowledge of customs, culture and values to that of paternalistic leaders whose appointment is entirely subject to approval of a minor state official.

The new version of Tuai Rumah is said to maintain his standing by way of having financial largesse to dispense to villagers. Those who conform are rewarded with a share of the allocated funds. Recalcitrant ones will not receive allocation.

Some may say that this pecuniary approach to exercising power and control is a practical and effective tool to maintain obedience. Others will see it as an emasculatory insult to the dignity of an entire race of Malaysians. This is Sim's third part:
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While PKR chief Anwar Ibrahim has made grand declaration of intent on taking power in the next Sarawak elections, very few Sarawakians themselves would be convinced that it would be an easy venture.

MCPX

I myself would be happy if the opposition coalition can win 24 or more state seats, thus denying BN a two-thirds majority in the Sarawak state assembly. Twenty-four indeed would be well within striking distance, since I expect the DAP and their partners to do well in the urban constituencies.

But in Sarawak, as in other parts of the country, opposition politics can only survive in the urban Chinese areas for a certain time. In native majority areas in Sarawak, opposition parties that have no ambition to rule the state will not attract bright political talent as well as the support of the voters. So what Anwar has announced is not just grandstanding, but the right thing to do.

Again, those of us who are familiar with politics in Sarawak know that the challenge of toppling the BN state government is harder than the ten Herculean Tasks put together. Massive vote-buying is rampant in rural constituencies, and has come to be expected by voters themselves. It has become a way of life in Sarawak.

Equally significant is the unique social structure of the rural communities in Sarawak.

The native communities are very closely-knit communities. They have to be because they live in far-flung isolated terrains and mutual dependence and close social cohesion is the way to be for their collective survival. Blood ties through generations of close marriages between neighbouring villages also mean that members of a local community are often related.

(In an election, the success and failure of a candidate sometimes depends on how many relatives a candidate has within the constituency!)

Within any one village, the most authoritative figure would be the village head, the ‘Tua Kampung’ or the ‘Tuai Rumah’ (in the case of the Ibans)

The village chief used to be an expert in native customary laws so that he could settle disputes between different households on various civil and criminal cases. In that sense, he was also a judge of sort. Nowadays, as the head of the JKKK, the village security and development committee, he has undisputed power over his charges under him. To the outside world, he is also the sole representative and spokesman for the whole village.

Not all chiefs that compliant

These village chiefs used to be freely elected by their villagers. Sometimes, the position was a hereditary one, passed down from father to son.

After the emergence of political parties in Sarawak following independence in 1963, it was increasingly clear that the Tua Kampong and the Tuai Rumah played a critical role in the fight for grassroots political support.

In fact, the Sarawak BN government has been quite successful over the past few decades through all kinds of administrative fiat in bringing these otherwise independent village chiefs under their direct control.

Today, even if a village headman is still elected by his villagers, his status must first be confirmed by the BN-controlled state government. He is answerable to low-grade state civil servants like district officers and the residents above them. Today, a village chief is akin to somebody at the lowest rung of the state civil service.

Joseph Tawi, in a Jan 6 posting on his blog has this to say:

‘Today, the criteria for Tuai Rumah have changed; he must be educated at least up to Form Three, be pro-Barisan Nasional (BN) and not necessarily having a deep knowledge of Iban Adat (this he can learn from the Tusun Tunggu, a book containing all the customs, traditions, taboos, fines, etc.).

‘After being elected, his appointment must be endorsed by the government so that an allowance of RM450 per month can be given to him. His duties include being the ‘eyes and ears’ of the BN government, a judge, a law-enforcer, tax-collector, consultant, and chairman of the JKKK (Village Security and Development Committee) through which government funds are being channelled.’

Be that as it may, not all village chiefs are all that compliant. I have personally met village chiefs who could stand up against powerful logging and plantation interests on behalf of their people. For their bravery and their service, they had been removed from their posts by the state government who then appointed others to replace them.

In the case of one such Tuai Rumah somewhere upstream from Bintulu along the Kemena River, he had merely led his villagers to fight against a logging company that had infringed upon their NCR land. For that, he was accused by the Pengulu Court of the crime of bulak (lying) under the adat istiadat, the Iban customary laws.

He felt great shame for being charged with this minor crime. On the day of the court hearing, I brought along a heavyweight lawyer from Kuching to defend him. The ‘Pengulu’ and the ‘Pemanca’ who were supposed to try him evaporated into thin air.

We also attended a gawai in his longhouse and made fiery speeches to exonerate this wonderful Tuai Rumah from his alleged sin. I was still a ‘YB’ then and my words carried quite some weight with the village folks.

But general elections are a different business altogether in the rural communities.

Naturally, it is common for village voters to defer to the opinion of the Tuai Kampong or the

Tuai Rumah even on the matter of voting for a candidate. But I have been to some longhouses where the village was split into two over their choice of candidate. After the election was over, the losing side would just move out and build another longhouse for themselves. Only my Iban readers can appreciate the financial difficulty and the emotional pain of such a drastic move.

Now, Joseph Tawi has something new to report on the same blog posting quoted above. The paragraphs below are taken from his soon-to-be-published book The Broken Shield Volume Two – The Dayak Dilemma.

No seat is easy to win

‘In this 2006 election, the BN devised an entirely different campaign strategy, which caught the opposition with their pants down. Previously, the money was passed directly to the voters on the eve of polling. This time the distribution was done through their Tuai Rumah.

‘Three days before polling, all the headmen were summoned for a meeting where they were coached to say something to their own people. And on their return to their respective longhouses, they were given some money that was to be shared with the voters of their own longhouses. In addition to this, there were also minor rural development projects that were promised to be implemented.

‘The Tuai Rumah then called for a meeting of the longhouse folks and ordered them to vote for the BN candidates. Anyone who failed to follow his order or directive would not be given any share of the goodies or any project that the government had promised them. And he was also likely to be expelled from the longhouse.

‘The Tuai Rumah must ensure that his followers must vote for the BN candidate, otherwise the BN candidate would report him to the district officer, the resident or the state secretary. As a Tuai Rumah is like a civil servant, action including the termination of his Tuai Rumahship could be taken against him. He might lose his monthly allowance of RM450 per month. And the promised minor rural development projects might be withdrawn.

‘In Daniel Tajem’s constituency of Bukit Begunan, he was defeated by a man, Mong Dagang, whom he had picked to replace him in the 1996 state election. Tajem practically lost in all the longhouses in the five polling districts. Before the money came, many longhouse chiefs and their followers had pledged their support to him who had represented them in six previous elections.

After the distribution of money and the threats issued, everything changed; longhouse headmen, their followers and even Tajem’s own relatives voted against him. And a similar tale of vote- buying had also been reported in other Dayak constituencies.’

Daniel Tajem – a long-time personal friend of mine – may be unknown outside Sarawak,

but he is still a household name in the Land of the Hornbills. He had held that constituency -Bukit Bangunan - near the town of Sri Aman six times, including the period when he was in the opposition. When an established brand name like that can fall to the hands of vote-buying and puppet-like Tuai Rumah, no seat is easy to win for any opposition party – including PKR.

I suppose that, once the Kuala Terengganu by-election is over, Anwar Ibrahim and his team of advisers would be sitting down over the impending Sarawak battle ahead. They would be thinking of what pledges to make to the people of Sarawak, if and when they take over the Sarawak government with the help of the other opposition parties.

Surely one of those pledges must be the restoring of the autonomy of the democratically-elected village chiefs throughout the state. The state government must recognise whoever is elected by the villagers as their headman, and pay them well nevertheless. Empowering the rakyat at the grassroots level would be the most meaningful reform in rural Sarawak indeed.

Part One is available here.
My observation of Part Two is available here.

etheorist: The zeroth point of economics

I have been following a Malaysian blogger, etheorist's blog, Economic Policy, for some time now. He approaches the thicket of economics with a humanistic, philosophical and first-principles paradigm. Initially, his writings give you a strange sensation of deja vu because there are many things that he writes about that is familiar to us.

But, we then have a nervous creeping sensation of intellectual vertigo when we realise that he tends to avoid quoting famous economists, thinkers or philosophers to underpin his propositions. Many readers will find it difficult to grasp the context of his propositions and curling observations of Life, the Universe and, Everything Else pearls of wisdom contained in his writings. But I urge you to press on.

His writings offer a familiar, yet, new perspective on many matters around us. His writings have a sagely tone. But peel away the simple phrases and words and you will be rewarded with insight.

I consider etheorist's posts the zeroth point of a holistic study of economics. It is a good starting point. Not that it is introductory by any means. But, that, it lends us a context in which to read economics.

My level of appreciation of the reading of economics has improved as a direct result of reading etheorist's take on things. Through his blog, I have also embarked on an interesting journey that has taken me to the following blogs:

Greg Mankiw, Professor of Economics at Harvard University, whose blog entries are always concise and succinct.

Through Mankiw, I have discovered Eugene Fama's collaborative blog, the Fama/French Forum, which he shares with Kenneth French, Professor of Finance at Dartmouth College. Eugene Fama is best-known for his seminal work, the Efficient Market Hypothesis and the random walk model.

Through the Fama/French Forum, I have discovered Richard Posner's collaborative blog, The Becker-Posner Blog, which he shares with Gary Becker. Posner is one of the founders of the so-called Law and Economics Movement that is still very-much driven by the University of Chicago Law School. This Movement advocates an application of economic principles to the evaluation of legal principles and, more importantly, proposed legislation, to test whether certain laws are economically feasible.

As an aside, the Law and Economics Movement, which is very much an American approach, has found a very excellent translator in Professor Brian Cheffins of the Cambridge University Faculty of Law. Cheffins has done extensive work to apply the Law and Economics matrix of analysis to English legal principles, particularly, in the area of Corporate Law.

The Universe of Knowledge is infinite so long as one remains inquisitive, I guess.

Palestine Relief Fund

Elviza of Write Away has made a posting on the plight of the victims of the attack in Gaza. I am more than willing to help the appeal for the PALESTINE RELIEF FUND through this post. I cannot do better than to copy en bloc her post on this very urgent humanitarian crisis:

If your heart bleeds for the atrocities bestowed on Gaza by the Israelis, do lend them a hand. Let us part with whatever we can afford to help Palestinians in their time of grief.

Mercy Malaysia has, on 30th December 2008, formed an Emergency Response Assessment Team to face the humanitarian crisis in Gaza strip. The team has been promptly dispatched to Egypt led by President, Datuk Dr. Jemilah Mahmood and Exco Member Norazam Ab. Samah.

The air strike and ground offensive on Gaza - as reported by AlJazeera - have killed more than 700 Palestinians, 219 of which are children. More than 3000 have been wounded.

Therefore, Mercy Malaysia appeals to generous Malaysians to send it cash donations. Contributions will support Mercy Malaysia to procure emergency surgical kits, medicines and hospital equipments to help the hospitals in Gaza.

• Cheque is to be made payable to “MERCY MALAYSIA” and addressed to Mercy Malaysia, Level 2, Podium Block, City Point, Kompleks Dayabumi, Jalan Sultan Hishamuddin, 50050 Kuala Lumpur.
• Cash donations can be made via on-line transmission or deposit at CIMB Bank Account No: 1424-000-6561053.
• Donation form can be downloaded from here.
• Further enquiries are to be directed to +603-22733999 or info@mercy.org.my

Let us make a difference by whatever little we have. From the bottom of my heart, I thank you for your generosity.

______________________.

And, may I say here, thank you Elviza for having drawn my attention to the desperate humanitarian plight of the Palestinians at the Gaza Strip.

You, and the other volunteers Mercy Malaysia are doing a wonderful job. Please keep up the good work.

A toll on BN strategy

I am quite bewildered by BN's tactical nous. My bewilderment arises in the matter of the declassification of the privatisation agreements for roads for public scrutiny albeit in a limited manner. Apparently you have to present yourself, pay a small fee and, you are given 2 hours to pore over each agreement.

This has led to an amusing (as opposed to amazing) race between DAP-PR and MCA-BN to produce their respective party's positions on the nature of the financial and operational arrangements between the government and the toll concessionaires. In both cases, to no one's surprise, the prognosis was a negative one.

The inference, quite correctly, is that the toll agreements are lop-sided in favour of the toll concessionaire. The agreements are said to minimise major financial and operational risks to the toll concessionaire while leaving the government to underwrite significant downside risks.

As it were, the monopolistic nature of the toll roads have proven to be a major financial coup for the toll concessionaires which proves that the traffic flows and urban planning studies were entirely correct. So, the toll operators are making tonnes of money. Both the DAP and MCA representatives are saying that the profits are excessive. Again, no surprises there.

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Roads are public goods
I have examined the issue of privatisation in a post entitled The Malaysian problem with the privatisation of public goods. Suffice to say here that roads fall squarely into the category of public goods.

Nationalisation of toll roads
I have also advocated the nationalisation of toll roads as one of several key economic issues in another post entitled An economic agenda to consider.

But, that was in June, 2008.

Two points
Having given a prolix preamble I have two points to present for your consideration. The first will deal with the economics and timing for any proposal to nationalise toll roads.

The second point is a humble observation on BN's tactical nous in declassifying the toll agreements at this time.

Economics and timing for nationalising toll roads
Upon examining the toll agreements, the DAP has called for the nationalisation of toll roads. Such a move will alleviate the financial burden on the public users of the toll roads in two ways. First, toll rates will be better regulated and, presumably lowered with each passing period of time. Second, any surplus or profits will be paid into the Consolidated Revenue as public funds.

These are sound propositions and, frankly, it warms the cockles of my heart since I have advocated the nationalisation of toll roads as a Malaysian economic strategy. But, there is a slight chill running down my spine at the same time. Why?

Funding the nationalisation process
The issue is funding. The toll concessionaires need to be bought out in order to amicably terminate the toll agreements. Without even having had the chance to read the toll agreements it can safely be assumed that there are sufficient provisions that require the unexpired portion of the toll concession period to be compensated. So, funding is required.

The federal government is cash-strapped. The fiscal policy is in deficit mode. Any funds scraped from the bottom of the barrel is likely to go to economic stimulus packages.

However, one clear source of funding is the issuance of sovereign bonds by the government. That should not be too difficult. It is easy to calculate the yields since there is a financial track record of the revenues received from the toll operations.

The problem will be to find investors at a time of global economic recession.

BN's tactical nous (or, the lack thereof)
If I were to wear the BN hat (something I literally did as a boy but, no longer ... because BN caps are not cool or properly designed, unlike the Nike Tiger Woods caps. But, I digress) I would be wondering about the political advantage for the toll agreements to be declassified at this time.

Perhaps the Works Minister can explain this.

As a citizen, a taxpayer and toll road user, I am happy with the declassification and the hard work done by the DAP and MCA to examine the contents of the toll agreements.

But, if I were a BN hack I would be wondering what the gameplan was?

You are exposing yourself to public opprobrium because the privatisation process, the toll agreements and negotiations were all conducted by the BN government.

The only mileage (pun intended) BN will receive from the declassification is that it has become more transparent. That is an abstract positive.

But wouldn't any BN strategists (if there are any) have given pause to consider that revelations such as these would only invite a real negative backlash? Didn't they realise that the toll agreements are rent-seeking arrangements that have upset Malaysian taxpayers and road users for the past two decades? Didn't they consider that there will be an outpouring of latent negative emotions when the rakyat finally discover that the bloody toll concessionaires have been profiting so obscenely while the rakyat suffered a higher cost of living as result of the toll roads?

And, for good measure, let it also be noted that if the declassification was an attempt to embarass past BN leaders that have become gadflies, the tactic fails for the simple reason demonstrated by a scene in Star Wars when Obi-wan Kenobi permitted his physical self to be slayed by Darth Vader after Obi-wan was certain that Luke Skywalker was safe. Thereafter, Obi-wan had become an ethereal and, yet ominous, presence as part of the Force. You cannot punch a shadow. 

Given these concerns, wouldn't it be more prudent to prepare a set of solutions in anticipation of the negative public response to the toll agreements before declassifying them? At least, BN could then say, Oh, yes! We knew that. That is why we have this plan in place and, ready for implementation to deal with the matter.

What were these guys thinking? In football parlance, this is clearly an own goal by the BN.

MCA: The silencing of Chua Soi Lek?

If a political party such as the MCA professes to operate from democratic principles, then someone in the position of Dr Chua Soi Lek, the Deputy President of the party, should be given the democratic space to speak his mind.
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As reported in Malaysiakini, the party's decision to require all bureau chiefs which includes Dr Chua as head of the party’s Government Policy Monitoring Bureau to seek prior endorsement from the presidential council before issuing press releases is definitely undemocratic.

It reeks of a clear attempt to rein in an outspoken leader.

Ong Tee Keat is demonstrating an alarming intolerance for different points of view. Having developed a reputation for being an independent and, dare I say, outspoken leader during his troubled rise to power within the MCA, Ong is now showing to the world at large that he is no different from past MCA leaders in being intolerant of different points of view.

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Imagine what he will do to party members who dissent?

This is not the reformist zeal that many were led to expect. This is a demonstration of an increasingly iron fist.

How does this recent move augur for MCA's share of the Chinese voter sentiment in Malaysia?

In horseracing parlance, the apprpriate expression may be, The going is not good.

Pure Shiite, Rocky and Walla

What an interesting day this has turned out to be. After a morning of drudgery to testify as a witness in a mundane employment dispute over inane matters, I was ready to make it up to satD the person behind the very incisive blogsite Pure Shiite, for having postponed our December teh tarik session.

I called satD to establish that he was still on Malaysian soil and, thankfully he was still here. And, even better, he was able to avail himself for the teh tarik session despite the frenzy (I would imagine) over the impending birth of his third child.

For good measure, I called brother Walla to form the quorum. Alas! commentator ben was unavailable this time. No matter. We had to press on.

I arrived early at Devi's Corner in Desa Sri Hartamas and arranged for a car wash and polish before settling down at the alfresco section of Devi's.

Two cigarettes later (a description of time best known to Iban trackers), I spied the superstar blogger Rocky strolling into Devi's. Two paces ahead of Rocky was a slim, bespectacled, T-shirted young man whom I correctly assumed to be brother satD.

Bloody satD had brought along Rocky! Will wonders never cease.

After some fifteen minutes Walla finally showed up, having gone to the older part of Sri Hartamas by mistake.

Naturally, the discussion turned to the profound mind of Sakmongkol. Walla and I were quite happy to confirm that Sak's intellectual reach was truly as impressive as was the man's natural serendipitous and modest demeanour in person.

Unfortunately Rocky had to excuse himself for another engagement.

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Picture borrowed from here.

satD told Walla and I that he had met Rocky in Bangsar. Nuraina Samad had been with them.

It was a singular thrill for Walla and I to have met with the great Rocky.

But, let me say that in the course of our chat, I concluded that satD is one of the finest Malaysian exports to Indonesia. A financial brain the size of a planet rests on his slender shoulders. Malaysia's loss (hopefully, not for too long) is definitely Indonesia's financial and capital sector's gain.

For now, Malaysia will have to be contented to experience the incisive albeit acerbic views of satD at his blog, Pure Shiite. The latest victim of satD's invective are the people involved in the IJN saga.

What a brain on such a young and bright Malaysian who, despite being transplanted to Jakarta, still has pure and unadulterated Malaysian blood flowing through his veins and arteries.

Floods in the East Coast

I wish to record here my sympathies for the flood victims in the East Coast. Read the reports from Malaysiakini, Malaysian Insider, NST Online and Star Online.

In Kelantan, the majority of the victims are reported to be from Rantau Panjang (331) while the rest were from Machang (111), Tanah Merah (92), Pasir Putih (49) and Kota Baru (40).

It is also reported that some 30,000 students in 38 secondary and primary schools unable to attend their first day of school Sunday as their schools had to be closed when floods hit six districts in Kelantan.

The number of flood victims in Pahang has risen to 2,921 this afternoon compared to 2,514 in the morning of Sunday.

As of 5 pm, Kuantan had the most people evacuated with 1,753 followed by Pekan (1,022), Cameron Highlands (35), Maran (93) and Raub (7).

My heart goes out, in particular, to the children who could not attend the first day of school. My wife and I have been preparing all the uniforms, shoes, socks, badges, bags, stationeries, breakfast and recess food for tomorrow (Monday) when our two children who are still schooling, goes to school again. These must be very, very trying times for the flood-affected parents.

I know the rescue agencies are doing their level best in these trying times. I also want to record my appreciation, as a taxpaying citizen, to these angels.

The Age of Aging

The Economist reviewed an interesting book by George Magnus entitled The Age of Aging: How Demographics are Changing the Global Economy and Our World that contains Malthusian overtones. Here are some interesting observations the review made:

EVERY age has its big demographic scares. In 1798, when the world’s population was about 1 billion, Thomas Malthus published his “Essay on the Principle of Population”, predicting that, thanks to mankind’s enthusiastic procreation habits, by the middle of the 19th century there would no longer be enough food to go round. In the event, people happily continued both to multiply and to eat.

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Indeed, in the early part of the 20th century, when the world’s population had grown to double that at Malthus’s time, fears started to run in the opposite direction: that people were having too few babies and mankind was in danger of dying out. The super-abundant baby-boomer generation after the second world war gave the lie to that. But by 1972 the argument had come full circle again. The Club of Rome, a global think-tank, produced a doom-laden report, “The Limits to Growth”, which claimed that within less than a century a mixture of man-made pollution and resource shortages would once again cause widespread population decline. What the think-tankers had not reckoned with was the green revolution. By the start of the new millennium the world’s total population had reached 6 billion. It is now expected to rise to nearly 9 billion by 2050.

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By 2050 the world will have about 2 billion people aged over 60, three times as many as today. In parts of the rich world, mainly Japan and western Europe, that age group already makes up nearly a quarter of the population. By 2050 their share will rise to 30-40%, and even in the—much younger—developing world it will go up to 25-30%.
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There is no doubt that global greying will happen. Many of the people that will contribute to it have already been born, so short of some catastrophe that kills off large numbers of people, or some Viagra-fuelled leap in birth rates, population numbers and age composition can be predicted with fair accuracy for decades ahead. What remedies should be adopted it is much harder to say.

The pundits who have pronounced on this over the past decade or so fall roughly into three categories: those who claim that this is just another Malthusian scare story and can be sorted out with a few tweaks to retirement ages and pension policies; those who preach gloom and doom (a meltdown in asset prices, poverty in old age, health-care rationing and even intergenerational warfare as the young and the old slug it out for scarce resources); and those in the middle, who crunch the numbers and try to come up with sensible ideas to make their effect less grim.

This book falls firmly into the last category. It provides a clear, sober and well-written analysis of the problem, both in developed and developing countries, and runs through the options for heading off the worst effects. The biggest part of the solution lies in expanding the shrinking band of workers, mainly by getting people to retire later and persuading even more women to take up paid employment. At the same time more productivity will have to be squeezed out of the labour force that remains. And people will have to be persuaded to save a lot more for their old age.

Read also, John Wiley's review of the book.

The Hornbill and Flags

I have always been fascinated with flags, emblems and crests for the symbolism that they carry. The website that carries a very credible amount of such information is the Flags of the World.

It has never ceased to strike me that the flags of the Malaysian State of Sarawak, Papua New Guinea, Timor-Leste (formerly East Timor) and the Australian Aboriginal flag bear such strikingly similar colours.

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Sarawak
Interpretation of the three colours

Red Colour: symbolises the courage, determination and sacrifices of the people in their tireless pursuit to attain and maintain progress and esteem in the course of creating a model State;

Yellow Colour: denotes the supremacy of Law and Order, unity and stability in diversity.
Black Colour: symbolises the rich natural resources and wealth of Sarawak such as petroleum, timber etc. which provide the foundation for the advancement of the people;
The Yellow nine pointed Star denotes the nine divisions where the people live in harmony. The Star symbol also embodies the aspiration of the people of Sarawak in their quest to improve their quality of life.


Papua New Guinea
The national flag has two triangles of red over black. The local kumul bird of paradise flies across the red half, symbolizing Papua New Guinea's emergence into nationhood. The five five-pointed stars of the Southern Cross constellation appear in the black, reflecting ties with Australia and other nations of the South Pacific. Black, red and yellow are also traditional colours in Papua New Guinea.


Timor-Leste
The yellow triangle represents "the traces of colonialism in East Timor's history". The black triangle represents "the obscurantism that needs to be overcome"; the red base of the flag represents "the struggle for national liberation"; the star, or "the light that guides", is white to represent peace.


Australian Aboriginal flag

The Australian Aboriginal flag was originally designed as a protest flag for the land rights movement of indigenous Australians but has since become a symbol of the Aboriginal people of Australia. The flag is a yellow circle on a horizontally divided field of black and red and was designed in 1971 by Harold Thomas, an Aboriginal artist descended from the Luritja of Central Australia. On 14 July 1995, both the Aboriginal flag and the Torres Strait Islander flag were officially proclaimed by the Australian government as "Flags of Australia" under Section 5 of the Flags Act 1953.

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It is obvious that the original human inhabitants of the archipelagic region were suitably impressed by the magnificent Rhinoceros Hornbill (Buceros rhinoceros).

There appears to be an ornithological link although recent records does not suggest that the Rhinoceros Hornbill is found in the antipodal countries of Timor-Leste, Papua New Guinea or Australia. Nor is there a clear anthropological link between the peoples of the archipelagic region stretching from Sumatra, Java and Borneo to the antipodal countries. Or, is there?

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HAPPY 2009

HAPPY 2009, EVERYONE!