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  • Challenging Malaysia's Status Quo by Lim Teck Ghee
  • Carl Vadivella Belle
Challenging Malaysia's Status Quo. By Lim Teck Ghee. Kuala Lumpur: Strategic Information and Research Development Centre, 2018. xxiii+ 476 pp.

Lim Teck Ghee has for some years enjoyed a reputation as one of the most perceptive observers of Malaysian politics, religion and society. In many respects, this current work may be viewed as an update of the comprehensive volume Multi-Ethnic Malaysia: Past, Present and Future (2009) which he co-edited with Alberto Gomes and Azly Rahman. Challenging Malaysia's Status Quo is a thematically organized and wide-ranging series of critical essays grouped under eleven sections which examine the many, and increasingly urgent, issues which will impact upon Malaysia's economic and political future. [End Page 726]

Lim contends that an obsession with the politics of communalism and racial structures, and growing religious intolerance, along with the entrenchment of both as instruments of social control, have led Malaysia into an increasingly dangerous cul-de-sac. These essays reveal a Malaysia plagued by widening ethnic polarization, a rampant and intrusive religious bureaucracy, an economy encumbered by networks of cronyism, favouritism and corruption, and policymaking processes that are based on ad hoc decision making that favours immediacy and short-termism.

In 2005, after some years abroad, Lim returned to Malaysia to establish the Centre for Policy Studies, a think tank located within the Asian Strategy and Leadership Institute (ASLI). This appointment was to lead him into the vortex of a rather acrimonious controversy. In 1971, the New Economic Policy (NEP) enunciated within the context of the Second Malaysia Plan (1971–75), aimed, inter alia, at attaining a 30 per cent share of corporate assets by 1990 for Malays and other indigenous groups—collectively known as bumiputera, or "sons of the soil". Barely a year into his appointment, Lim and his co-author Edmund Terence Gomez, published the paper Corporate Equity Distribution (2006) which questioned government statistics on ethnic ownership of corporate equity. Using advanced and contemporary methodologies, the paper concluded that the NEP target of 30 per cent equity had not only been reached but exceeded, and bumiputera ownership of corporate equity might actually be as high as 45 per cent—compared to the official figure of 18.9 per cent. In the furore which followed, ASLI President, Mirzan Mahathir, announced that the study would be withdrawn. In his subsequent letter of resignation, Lim asserted his belief in the validity of the research which informed the paper and stood by the paper's conclusions.

The controversy overshadowed the report's conclusions and recommendations. While Lim and Gomez noted that the NEP had been remarkably effective in redistributing wealth in terms of equity, it had outlived its usefulness and had ceased to meet its foundational objectives. Moreover, it neither promoted national unity nor contributed to equitable development. The Mahathir policy of [End Page 727] creating a select and catalytic strata of Malay entrepreneurs had been exposed as a failure during the financial crisis of 1997 when many newly formed Malay businesses proved unviable. Additionally, the policy of selective patronage had concentrated Malay wealth within a small body of politically well-connected Malays, and had done little to uplift the poorer members of the community. The study contained a series of recommendations which highlighted the need for sweeping reforms in poverty alleviation, education, economic regulation, and the administration of the civil service (pp. 45–84).

The New Economic Model (NEM), initiated within the context of the Tenth Malaysia Plan (2011–15), forecast major reforms that would promote both transparency and efficiency. However, as Lim documents, very little changed in reality; the foreign workforce continued to expand, and the management of Government-Linked Companies—the major shareholders of corporate equity—continued to be determined by political and ethnic criteria. The extension of the NEP's 30 per cent requirement beyond corporate equity to include property and assets, and the continuing focus upon ethnicity yielded new avenues for corruption, rent seeking and cronyism. The outcomes have been predictable—a severe reduction of foreign direct investment flows, capital flight, diminished competitiveness, an accompanying brain drain, and substantial levels of financial outflow...


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