Malaysia in the Era of Globalization #96

M Bakri Musa

Chapter11: Embracing Free Enterprise

Encouraging Entrepreneurialism

Starting Small

The remarkable thing about these initiatives I describe is that individually and in the aggregate, they would cost very little. The default rate for such loans is very low, as demonstrated by the experience of Grameen Bank in Bangladesh. But the most important benefit of such a scheme is that it would encourage trade among ordinary Malays and teach them the value of business and free enterprise. This would help eradicate the ingrained mindset of forever waiting for the government or someone else to provide them with a paycheck.

Once we have succeeded in producing such low level entrepreneurs then we could move up the ladder, to professionals and sub-professionals like accountants, lawyers, and engineers. From there, the government could then target the bigger contractors and major players. And with involvement at each level, the government would have better experience in assessing the risks and viability of the various individuals and proposals.

The difference between my plan and the government’s present strategy is that I let the market decide who should get the benefit of government help, not some all-knowing civil servant back in Kuala Lumpur. Further my plan is considerably cheaper and impacts many more people, in contrast to the present where billions are being lavishly squandered on the few. Lastly my plan will produce real entrepreneurs, not the armchair types that the Malay community currently have in abundance.

The remarkable observation about many successful companies of today is that they all started small. HP and Apple Computer were both started by engineers tinkering in their garages. No Washington official earmarked them for success. Grooming entrepreneurs from below would prove more enduring and successful, in contrast to the present strategy of starting at the top.

My point is, we do not know where the next spark will come from. What is important is that we must create the conditions whereby should that spark ignite, it would start a chain of reactions far and beyond. This notion that some high and mighty bureaucrat or esteemed leader sitting in his air-conditioned office in Kuala Lumpur could pick industry winners, is pure bunk. And their track record proves it. The sooner Malaysian leaders disabuse themselves of this delusion the better it would be the nation.

One of the lessons of history is that no society that values order above everything else will encourage creativity among its citizenry. Such societies will be orderly all right, but they will not be creative or blazing new trails. The reverse is equally true, that is, without some degree of order, creativity will disappear.