The long and winding road called the NEP (UPDATED with Chinese Translation)

This is a longer article than usual but it is still a short piece for what I need to say. I actually could write a whole book on this issue but instead I have summarised what we had to go through over 40 years since 1970 with regards to the New Economic Policy or NEP. There are many things that Malays may not be aware of and which they should know.


Raja Petra Kamarudin

There are a few good pieces about the New Economic Policy written by Suflan Shamsuddin, Datuk Zaid Ibrahim and Khoo Kay Peng, which have been posted on Malaysia Today. These are very good pieces and I really do not need to add anything more to those points raised by these writers. Nevertheless, you know me. I just can’t leave things alone without also giving my two cents worth.

I do not wish to contradict or rebut what these writers say. Instead, I wish to reiterate their points and add a bit more on what they had probably missed. You see, being much older than these writers (I will be 60 this September), and the fact that I was involved with the Malay Chamber of Commerce and was a central committee member for a number of years, I am privy to some information that they may not have.

I was already involved with what I would call ‘the struggle’, for want of a better word, since way back in the 1970s, when some of these writers were still in school. Much was done in the ‘backrooms’ and hidden from the public eye. So not all of what transpired is public knowledge. Maybe I can reveal some of these things so that the picture becomes clearer.

I read what those 20-year old and 30-year old Umno ‘activists’ have to say about me — in that I am a traitor to the Malay race because I uphold the concept of a multi-racial Malaysia and am opposed to Malay rights and privileges plus the NEP. These people were born in the late 1970s (some only in the 1980s) and did not ‘enter the market’ until the late 1990s or thereabouts. By then the NEP was supposed to have been officially over. It was supposed to have ended in 1970.

So what do they know about ‘our struggle’? They were not even born yet then. And even if they were they were mere toddlers or primary school children. We were already on the battleground and fighting in the trenches long before they even realised that such a thing called the NEP existed, or what it meant. And let me tell you that we fought tooth and nail against the powers-that-be, resulting in many of us falling victim to government retaliation. Many of us lost our businesses because the government was determined to bring us down as punishment for being too outspoken and too ‘militant’.

Those of my generation would probably remember the Umno Youth convention in Kemaman, Terengganu, back in early 1990. In this convention my name was mentioned and the Menteri Besar, Wan Mokhtar Ahmad, told Umno Youth that I must be brought down. Eventually, Umno Youth infiltrated the Terengganu branch of the Malay Chamber of Commerce and ousted me, and those they considered my ‘cronies’, from the Chamber. (Anwar Ibrahim can confirm this because Wan Mokhtar spoke to him about it).

During one Chamber committee meeting in Kuala Terengganu, some Umno Youth members gate-crashed the meeting with the aim of starting a fight. It did end up in a fight when I chased three Umno Youth members out of the meeting room and we came to blows. (Yeap, me alone chasing three Umno Youth chaps who ran away in fear). This incident was reported by the Malay mainstream newspapers — and it was also brought to the attention of the Menteri Besar.

I was then confronted by an Umno Terengganu Member of Parliament who told me to get out of Terengganu. I am not welcome in Terengganu, he told me. Go back to where you came from! I faced so many problems with Umno Terengganu so in 1994 I left the state after spending 20 years of my life there. And that ended my ‘career’ as a ‘fighter’ for Malay interests. I then decided to look at the bigger picture, the fight for a better Malaysia.

Anyway, I am digressing too much so allow me to come back to the issue of the day, the fight to improve the implementation of the NEP.

Yes, you read it right: the fight to improve the implementation of the NEP. That was what our fight was all about — to correct the implementation of the NEP that had gone wrong.

The NEP was an ill-conceived idea that was conjured in a hurry and out of desperation to appease the Malays in the aftermath of the 13 May 1969 race riots. It was an idea agreed by Umno, MCA and MIC, basically the members of the Alliance Party. So it was something that was agreed by the Chinese and Indians as well.

But the NEP was just an aspiration (hasrat). It was not a law. And it was never passed by Parliament. For that matter, it even violated the Federal Constitution of Malaysia. So in that sense it was illegal. But it was done anyway. And MCA and MIC agreed to go along with this ‘illegal’ aspiration for the sake of appeasing the very disturbed Malays and to prevent further race riots. It was a sort of necessary evil that the Chinese and Indians tolerated for the sake of racial stability.

But the NEP was supposed to run for only 20 years. By 1990 the NEP would end. It was not an open-ended policy that would run forever. And even the Prime Minister then, Tun Dr Mahathir Mohammad, agreed with this and he reminded the Malays so.

Soon after Dr Mahathir took over as Prime Minister, he invited the members of the Malay and Chinese Chambers of Commerce for dinner at the Equatorial Hotel in Kuala Lumpur. In his speech Dr Mahathir told the Malays that the NEP has less than ten years more to run. Dr Mahathir made it clear that the NEP would end in 1990 as agreed. It will not be extended beyond 1990.

So the Malays had better get their act together, warned Dr Mahathir. Don’t grumble and complain when the government terminates the NEP in 1990. The government is giving the Malays ample warning. Get ready. The NEP will end in 1990. So prepare yourselves for it.

It was agreed that the NEP would run for just 20 years, reminded Dr Mahathir. The Chinese and Indians agreed to the NEP because it was not going to be a never-ending policy but something that would be in force for just 20 years. So in 1990 it must end, as agreed. It would be unfair to the Chinese and Indians if it was extended beyond 1990.

The Chinese, in turn, were told that they should work with the Malays and help them in their businesses. Don’t just leave it to the government, said Dr Mahathir. It is better that the Chinese and Malays work together rather than the government is forced to introduce measures like the NEP.

It is to the interest of the Chinese that the Malays are successful, argued Dr Mahathir. If the Malays were successful then they would not be jealous of the Chinese. But if the Chinese grab all the wealth of this country while the Malays were left behind then the Malays would become militant and would try to grab what belongs to the Chinese.

This, basically, was Dr Mahathir’s message to the Malays and Chinese. To the Malays it was get ready to see the end of the NEP in 1990. To the Chinese it was work with the Malays and take them as your partners. If not they would become your enemies.

It was a good message. Whether it was workable or not is another matter and I do not wish to analyse Dr Mahathir’s logic. Sometimes, some things look good in theory but may be hell to put into practice.

A couple of years later, around 1985, the Malay Chamber organised a two-day seminar at the Shangrila Hotel in Kuala Lumpur. Dr Mahathir officiated the opening and the Deputy Prime Minister, Tun Gafar Baba, officiated the closing. The purpose of this seminar was to discuss the failure of the NEP and the reasons for its failure — government inefficiency, corruption, unfair competition from GLCs and Umnoputeras, etc.

At the end of the NEP in 1990, the Third Bumiputera Economic Convention was organised in the PWTC, also in Kuala Lumpur. This Convention was organised together with the government and with the participation of the non-Malays and all the political parties. The purpose of this Convention was to explore what to do now that the NEP had ended. What should replace the NEP? Where do we go from here (1990)?

If I were to go into detail as to what transpired from 1985 to 1990 I would need to write a book. Suffice to say I was involved in the Malay Chamber of Commerce since the 1970s, not long after the implementation of the NEP and even before Dr Mahathir became Prime Minister. Then, soon after Dr Mahathir became Prime Minister and when he warned us that the NEP was going to end in 1990, we sat down to look at what to do. Then, in 1990, after the NEP had officially ended, we again sat down, but this time in a bigger forum over many days, and in ‘joint-venture’ with the government, the non-Malays and the political parties, to seek a solution to the problems of the Malays.

To summarise what we concluded over those many years, the NEP is not just about the Malays. It is a multi-prong attack (serampang dua mata) to reduce the gap between the haves and the haves-not (regardless of race), to make the distribution of wealth more equitable, and to reduce the disparity between the different races. This was what the NEP was all about. However, along the way, the Malays forgot about this multi-prong attack and thought that the NEP was just about the Malays.

Furthermore, the NEP is not just about business, tenders, contracts and permits. It is also about the racial quotas in the civil service. And it is also about education. Banks were created to help the Malays. But banks were also created to help those who needed help but could not get it from the foreign owned banks whether they are Malays or otherwise. Various funds were also set up to assist businessmen who needed start-up or venture capital, research and development grants, and whatnot. They could even be given marketing grants and grants to travel overseas to open up new markets or participate in trade fairs and what have you. And this was, again, not just for the Malays but for all those who needed help.

So, in short, the NEP was an entire program. It was not just about business. And it was not about just the Malays. It was a total restructuring of society and to help businessmen become more competitive against the onslaught of the global market.

In theory, the NEP is good. Everyone agreed with that. But in practice, it failed. And the Malays became confused and thought that the NEP was just about them. So where did we go wrong?

Many issues were identified. One was the change of direction that was introduced by Dr Mahathir that worked outside of and opposite to the NEP. In short, the NEP was derailed and hijacked.

Dr Mahathir realised that it was impossible to help 15 million (at that time) Malays to become rich. So abandon that idea, which was partly, and I repeat partly, what the NEP was about. Instead, make a few Malays rich. Create a handful of, say, 100 Malay billionaires. Then get these billionaire Malays to hep the rest of the Malays.

That was a noble plan indeed. So Dr Mahathir went and created the super-rich Daim, Tajuddin Ramli, Halim Saad, Shamsuddin Abu Hassan, Ahmad Sebi Abu Bakar, Wan Azmi, and many, many more. These people would be turned into billionaires so that they could then help the other Malays.

That did happen, of course. We did see these new billionaires emerge. But they did not help the other Malays. Instead, they worked with the Chinese and new Chinese billionaires were created because of it. Many Chinese became rich because of their partnership with the Umno cronies or Umnoputeras.

Then there were the GLCs or government-linked companies. What happened was that these GLCs competed with the Malays and it was unfair competition. The GLCs ‘stole’ all the businesses meant for the Malays. It was not the Chinese and Indians who were the problem. The Chinese and Indians were not killing the Malay businessmen. It was the GLCs that were killing off the Malays.

We in the Malay Chamber coined that new word, Umnoputeras. The Chinese and Indians were not the enemy. The Umnoputeras were. And so were the GLCs. And we told the government this.

In fact, in one seminar in the Ministry of Trade, hosted by the then Minister, Tengku Razaleigh Hamzah, we in the Malay Chamber told the government that we do not need the NEP. We do not need so-called government help. What we need is for the government to stop the Umnoputeras and GLCs from competing with the Malays and from killing off the Malays.

In 1970, when the NEP was first launched, the Malay share of the economic ‘pie’ was just 1.5%. By 1985, 15 years later, it was still just 3%. The target was 30% by 1990. How can the Malays catch up in a mere five years when in 15 years it grew from just 1.5% to 3%?

This was the concern we expressed. And we knew it would remain at 3% till 1990 and beyond. There was no way it could reach the target of 30%.

But who is to be blamed? Is it the Chinese and Indians? No! It is the government with their GLCs and Umno with their Umnoputeras. And we told the government this.

Today, it is still 3% as what we predicted 25 years ago in 1985. Of course, if you include the GLCs and ‘trust agencies’ it will be about 19%. But GLCs and trust agencies do not belong to the Malays. They belong to the nation. They belong to the taxpayers. What belongs to the Malays is what is in their pockets. And that is only 3%.

The Minister of Trade, Rafidah Aziz, blamed the Malays for this. We gave the Malays so much, Rafidah said, but they sold everything and spent all the money. If the Malays had kept what the government gave them then we could have achieved the target of 30%, maybe even exceed it.

You Malays waste what the government gave you, lamented Rafidah. Then you complain when you have finished the money and then you accuse the government of not helping you. How can the government keep giving you forever? The government has done what it is supposed to do. But the Malays are not doing what they are supposed to do. The Malays prefer to buy expensive cars and marry many wives when they get rich. And when they become poor again they go running to the government and expect more help from the government.

Undeniably, the NEP has failed. We in the Malay Chamber of Commerce already said it has failed 25 years ago back in 1985. And the government too said it has failed and that it has failed not because of the Chinese and Indians but because of the Malays themselves. The Malays, however, blame the GLCs and Unmoputeras for that failure. Whatever it may be, both the government and the Malays admit the failure of the NEP though each points to the other as the reason for the failure.

Okay, that may be as far as the corporate scene is concerned. That is only part of what the NEP is about. What about the other sectors?

Malays are not denied an education. If the Malays are capable and qualified they can get to go to university, many to overseas universities on top of that. The heads of the government departments are mostly Malays. The heads of the government agencies, the various branches of the armed forces, police, etc., are all Malays. The Ministers in key ministries are all Malays (finance, trade, etc.). The majority of civil servants are Malays (97%-98% of the voters in Putrajaya are Malays). And so on and so forth.

Malay fishermen and farmers are given aid. They were given free fishing boats, marine engines, fishing nets, fertilizers, tractors, etc. Their fuel is subsidised. In fact, even Chinese fishermen in Penang, Perak, Selangor, Johor, etc., received aid. So it is across the board and not only for the Malays although the majority were Malays — since there are more Malays than non-Malays in the agriculture and fisheries sector.

The land settlers are all Malays. And many have become millionaires when they sold their land decades later. There are no land settlements for Chinese and Indians.

So where is it that the Malays are left out? Is it because the Malay share of the economic ‘pie’ is just 3% instead of 30% that you say the Malays are left out?

You must understand, the 30% was calculated in 1970, 40 years ago. Going by 1970 standards the Malays have reached the target of 30%, in fact, even more. But the ‘pie’ did not remain static. The pie was only 1KG in 1970 and the Malay target was to get 30% of 1KG. But the ‘pie’ grew over 40 years. Today, the ‘pie’ is 50KG. So, today, the 3% Malay share of 50KG is much bigger than the target of 30% of 1KG, 40 years ago.

It is a moving target. It is not a static target. So, as the target grows bigger your share in percentage may be small but in absolute terms is so much larger.

The Malays did take one step forward as what was planned in 1970. In that sense the NEP has succeeded. But the world took 50 steps forward since 1970. And the Malays are just not able to keep up with the pace that the world is moving. So the Malays are behind not because they stepped backwards or they stopped moving but because everyone is moving at a much more rapid pace, which the Malays just can’t keep up with.

Let’s not just talk about percentages. If one person was unemployed last year and, today, it is two people who are unemployed, can we say that unemployment has increased 100%? Two Malaysians unemployed from just one last year is not bad. But in percentage it looks bad. It is an increase of 100%.

How many Malays lived in middle-class homes in 1969? How many Malays lived in upmarket homes in 1969? How many Malays went to university in 1969? How many Malays received an overseas education in 1969? How many Malays were employed by the government in 1969? How many Malays drove Mercedes Benzes, BMWs, Ferraris and Porches in 1969? How many Malays could afford RM100,000 motorcycles in 1969? And so on and so forth.

Don’t just look at the 3% (or 19% if GLCs and trust agencies are included). Look at what your grandfather was doing in 1969. And look at where you are now 40 years later. That is what the NEP has done for you.

So, yes, in some ways the NEP has failed (although the government blames the Malays themselves for this failure). But in many more ways the NEP has succeeded. And you Malays reading this piece is proof it has succeeded. If not you will be back in the kampong planting padi or following your father to catch fish instead of reading Malaysia Today.

To the Malays, this is my message. Malays are Muslims. So use your ‘Islamic head’ to think. Islam asks us to shukur (show gratitude to God) for the nikmat (blessings) we receive from Allah. If we do not shukur then we are considered kufur nikmat. And kufur comes for the word kafir or infidel. Yes, Islam asks us to not question what we do not have but to shukur for what we do have. And doing otherwise makes us kufur nikmat.

To say that the Malays still need the NEP is an admission that the Malays are weak. Where is your Malay pride and dignity? You look at what the Chinese and Indians have and complain because you too do not have the same. But you forgot that the Indians and Chinese agreed to give the Malays 20 years to catch up. Is it their fault if you did not?

And we did catch up. The only problem is the Chinese are Indians did not stand still to wait for the Malays to catch up. They too increased their wealth. And the Malays also increased their wealth. But now we are comparing what the Chinese and Indians have to what we have and we are not happy. We used to take a bus to go to town 40 years ago. Today, we are driving expensive cars. But we have only three cars while the Chinese and Indians have ten. And that is why we are not happy.

Tak malu ke Melayu sungut macam ini?


Translated into Chinese at: