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Malaysia-US FTA negotiations hit turbulence

Anil Netto
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It looks like the FTA negotiations between the United States and Malaysia – now in a crucial phase – are not going to be easy to conclude. For one thing, there is the whole issue of government procurement and how an FTA would affect the NEP policy of affirmative action. More crucially, an FTA would take away economic sovereignty from Malaysia, allowing Big Business from the United States to gain power and influence over the Malaysia government. Not good.

It would also lead to a quickening in the pace of the neo-liberalisation of the Malaysian economy, thus aggravating the already huge divide between the rich and the poor in the country.

Because I was concerned about the impact an FTA would have on Malaysia, I wrote this piece for Aliran Monthly:

The problem is while the Americans are going around and putting their “spin” on how Malaysia stands to “benefit” from this FTA (as if the US is doing us a big favour, when we know they are eyeing our financial services sector and government procurement), the Malaysian government has been largely silent. There has been no popular input or consultation with say, the rice farmers in Kedah, who are really worried about agriculture imports. Neither has there been much media coverage, public consultation or parliamentary scrutiny of the impact the FTA is likely to have on Malaysia.

When an American speaker from a US think-tank was asked by a Malaysian activist about the lack of transparency in the FTA negotiations, he retorted, “You are asking the wrong person. You should ask your own government.”

So let’s ask again, where is the transparency? Full article

Banks against the wall

Anil Netto
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Things can go drastically wrong when banks are poorly regulated – as we saw during the 1998-98 Asian economic crisis. The problem is further compounded when political connections come into the picture. During the 1990s, I personally saw how banks were falling over themselves to lend to certain politically well connected firms, sometimes merely on the basis of a “Letter of Comfort” from a profitable holding company.

And when the day of reckoning comes, as it did in 1997-98, it is the government (read, the taxpayer) that has to step in to bail out loan-saddled banks to the tune of billions of ringgit. To this day, Malaysians still do not know for sure who the culprits were.

I wrote this piece for the New Internationalist magazine, highlighting some of the problems that plagued our banking system back then. Will we ever learn?

Banks against the wall

Dipping deep into public funds, Anil Netto finds the Malaysian Government bailing out banks… and their well-connected debtors.

When I was a child, my father used to pick me up after school and drive me home. Sometimes he would stop by at the local branch of the United Malayan Banking Corporation (UMBC), where he had an account. I would wait in the car while he applied for a bank draft or arranged to make some other payment. Those were the days before computers when a simple transaction could take what seemed like an eternity for a child waiting outside in the car.

Today, as I pass by that same street, the bank – once Malaysia’s third largest – has vanished, as if some alien spacecraft had zapped it. It is now a supermarket. Its disappearance is a classic example of how government bails out banks while the well-heeled and well-connected escape responsibility. Full article

Latin America has tips for Asean Charter

Anil Netto
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I wrote this article for IPS because I was concerned that Asean was heading down the neo-liberal path. I felt there were many lessons that the people of Asean could learn from South America, where many countries have rejected neo-liberalism after the devastating impact it has had over there. Moreover, the Asean Charter is being drafted even though many in civil society have not been thoroughly consulted.

PENANG, Malaysia, Jan 24 (IPS) – Over the last two months, South America and South-East Asia have taken huge steps forward towards creating two distinct regional blocs. But the contrasting principles in their respective blueprints for integration reflect the different political and economic philosophies driving the integration plans.

Earlier this month, leaders of the Association of South East Asian Nations (ASEAN) met in Cebu in the Philippines and approved a blueprint for a charter, which will lay the foundation for a new ASEAN Community by 2015. ASEAN groups Singapore, Malaysia, Thailand, Burma, Laos, Cambodia, Vietnam, Brunei, the Philippines and Indonesia.

The guiding principles in the ASEAN blueprint reveal a markedly different emphasis compared to the underlying tenets in the Cochabamba Declaration, signed in Bolivia last month, paving the way towards a South American Community of Nations. Full article

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