Rommel, the NEP and the EU’s hidden agenda

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When writing the piece below for IPS, I spoke to economist Charles Santiago, who told me that non-Malays are so tired of the discrimination under the NEP that many of them would support FTAs with the US and the EU. “But they have to keep in mind the larger implications of an FTA, which means that whether you are a Chinese, Malay or Kadazan businessman or woman, you will face stiff competition from TNCs who are technologically superior,” he warned. ”It will be a takeover of our businesses in the long run.”

”There is a hidden agenda here,’‘ he added. ”They (EU officials) are in effect saying, ‘You guys open up your economy so that our European investors can take over your market’.”

Rommel’s salvo on the NEP is an opening shot across the bow as EU-Asean FTA negotiations get under way in Vietnam in July and perhaps reflects underlying frustration that Malaysia is holding out on signing a pre-agreement.

But in many ways, the NEP vs FTA choice is a false option. We all know that the NEP is deeply flawed and divisive, based as it is on race-based considerations that only serve to entrench Umno in power through a politics of patronage.

That does that mean we do not need a wide-ranging policy – call it what you will – to uplift the economic position of the many Malaysians – including ethnic minority and marginalised groups – who continue to be left out of “development”. A genuine and just affirmative action policy would be one based on need and socio-economic position – not race.

It is naive to believe that an FTA would prove beneficial to Malaysia in the long-run. One need only look at Mexico’s experience with Nafta and the Mexico-EU FTA to discover that the promises of liberalisation and so-called “free trade” are illusory.

In truth, (as we have seen with US/Nafta-led free-trade strategies in Central America), an FTA will deliver nothing favourable for Asean, the wider society or, most notably, the poorest within that society, the Glasgow-based political scientist and author John Hilley told me.

Instead, those most immediately affected, in our case the Malays and non-Malays, have to recognise the false options of domestic protectionism versus open-door trading trade being promoted here – which he says is a contrived agenda which, in turn, has led to divisive positions on the NEP.

So what is the alternative? “The real task, local, regional and global, is to reject the diversionary language of neo-liberal solutions and, as in Latin America, build alternative trading arrangements and coalitions that are about advancing the interests of people rather than big business and their political advocates,” Hilley stressed. In short, we need an economic framework that puts the interests of ordinary people over big business.

PENANG, Malaysia, Jun 27 (IPS) – Unexpected criticism of Malaysia’s race-based affirmative action policy by the European Union’s top envoy reveals underlying concerns that this could be a stumbling block to unrestricted market access for European multinational firms in the region, say analysts.

Envoy Thierry Rommel’s remarks are being seen as the opening salvo ahead of talks for a free trade agreement (FTA) between the EU and the Association of South-east Asian Nations (ASEAN) that begin in July. Full article: Trade fears fuel EU criticism of race-based policy

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