Mahathir 2.0 and his Look East Policy 2.0 in Malaysia 2.0

By MT Webmaster On Jun 16, 2018

Mahathir Malaysiakini

With Japan being the first country to visit after being sworn-in again as the Prime Minister of Malaysia, Dr Mahathir Mohamad’s’s pledge for the rejuvenation of the Look East Policy (LEP) did not come as a surprise.

Regardless of how successive BN administrations attached importance to it after the end of the first Mahathir era (1981-2003), such a policy has never vanished from our foreign policy radar since its introduction in 1982.

Now, with Asia tipped to become the world’s economic powerhouse and the locus of international affairs in the coming years or even decades, not ‘looking East’ is definitely not an option for the Pakatan Harapan administration which is determined to re-position Malaysia onto the right track of economic development.

Having said that, what the present Malaysia needs is not the older version of the LEP but rather, an upgraded version that is relevant to the present international dynamics, especially in the Asian region.

While another wave of the LEP is expected to develop following Mahathir’s visit to Tokyo recently, it is timely to revamp this three-decade-old policy which was initially conceived in response to the prevailing situations of the 1980s — a strong Japanese economy and fiscal position, rise of the Asian tigers (of which Malaysia was one), and the then industrialisation trend that was predicated upon mass production and assembly lines.

For sure, all of these scenarios have either deteriorated (albeit to a certain extent) or even no longer exist in today’s world.

For a start, the LEP 2.0 should clarify the East Asian economic models which we aspire to learn from. A product of its time, LEP 1.0 had been designed for learning the working ethics, technologies, expertise and public-partnership policy of Japan — the country which successfully achieved an advanced economy status in the 1970s.

During his recent Tokyo trip, however, Mahathir was also toying with the idea of learning from China as well, apart from keeping the traditional learning targets of Japan and South Korea. Hence, the question to ask is – which of the East Asian economies should we learn from today?

Does China — an advanced developing economy which differs from us in terms of its mixed economic structure and public governance system — possess any successful experiences that we can learn from? Or how relevant is the LEP 2.0 if we do not include this second largest economy in the world as part of our learning path? And then, how about Taiwan and Hong Kong which can also provide their economic development lessons for a similarly small economy like Malaysia — looking to achieve a fully developed country status by 2020/25?

Or else, should we just revert to the original LEP which largely focused on the Japanese and limitedly, the South Korean economic models and not others? These are the questions we should ponder before deciding what to learn from any of these East Asian economic models.

The second question then will be what should we learn from these models. While the working ethics of the Japanese and South Koreans will continue to be the core of the LEP 2.0 (as repeatedly stressed by Mahathir recently), Malaysia should also inject new purposes into this policy in tandem with the present trends of economic development and Harapan’s principles of governance.

Instead of investing in another heavy industrial production project such as the national car 3.0, it is more tangible and crucial to acquire the technologies and know-how of the industrial revolution 4.0. These may include importing from Japan and Korea the latest physical and software components used in the cyber-physical systems for our local production lines as well as sending our local skilled workers to train under their Japanese and Korean counterparts on how to operate and maintain such complicated tools in the factories.

Much-needed technologies

As an extension to that, other related technologies of industry 4.0 such as the Internet of Things (IoT), cognitive computing and big data analytics can also be utilised to support not just the connected production line but also the development of a digital economy or shared economy.

For instance, whilst these three technologies are used to man several robots simultaneously in the factory today, they are also collectively used in the consumer market in the form of apps. China’s giants such as Alibaba and Tencent are the best examples for utilising such an integrated technology in the wider and sophisticated scale culminating in the speedy development of e-commerce in the mainland just within several years.

Any cooperation with them will bring in the much-needed technologies and know-how in managing and operating our own (future) integrated apps that may be tailored for other commercial endeavours or even public policy delivery purposes.

On the other hand, Taiwan’s creative economy and open source data policies may be more relevant for the Harapan administration’s transparency, competency and accountability principles of public governance as stated in their election manifesto, Buku Harapan.

The same goes to the Hong Kong government’s model of public-university-private incubation programme, the Hong Kong Science and Technology Park (HKSTP) and the business-to-business-focused accelerator blueprint — excellent case studies for Malaysia (federal and state) in encouraging entrepreneurship in the new industries of gaming, Internet and mobile spaces. For one, these are some of the public policies that can be adapted from both Taiwan’s and Hong Kong’s developmental experiences as part of the LEP 2.0.

Lastly, the third question is how should we implement the LEP 2.0 in a much different way than the one mooted in 1982. For one, the suggestion by Phar Kim Beng to establish the Look East Committee is a good start to institutionalise this crucial policy as Malaysia will largely dependent and affected by regional dynamics for years to come.

But such institutionalisation can be even more sustainable in the long-run (in light of Mahathir’s departure from the political scene in the next few years). For this, I would propose that the ruling coalition should consider formulating a Charter of the LEP and tabling it in Parliament for approval or even, issue it through the cabinet — just like how the Japanese cabinet issued the Official Development Assistance (ODA) Charter in 1992.

Within the charter itself, there should be guidelines outlining which East Asian economic models as well as which targeted industries and policy areas we are to learn from. Moreover, it can also specify the principles, rules and practices in implementing the LEP 2.0 based on national sovereignty and interests as well as the tenets of good governance — transparency, open access to information and data, accountability and efficiency.
It can also specifically describe the role and functions of the Look East Committee alongside its overall arrangement (the membership drawing pools, numbers of committee members, periodic evaluation of the LEP 2.0 and check-and-balance mechanisms).

Provided with the needs of time, the government of the day can even revise such a charter to ensure the relevance of the LEP to the evolving international environment as well as to any adjustment in Malaysia’s foreign policy priorities such as the promotion of good governance and human rights in international organisations, active diplomacy in Asean as well as the leadership’s quest in the Islamic world.

More importantly, a charter is also enforceable in that any administration in Putrajaya will not only inherit such comprehensive and future-oriented foreign economic policy but also, it prevents the current Harapan administration and its successors from sacrificing Malaysia’s neutrality in favour of any single East Asian country or party.

This will definitely avoid the risk of entrapment which may befall us in the event that we are pitted against the other great power’s camp for the national interests of the latter.

In all, comprehensive and detailed deliberations are definitely needed to formulate the LEP 2.0 and they should not be a top-down agenda as in the first Mahathir era.

Establishing a Look East Committee that works closely with the cabinet and other relevant ministries, may be the best start to explore the three fundamental questions as explained earlier:

which East Asian economic model should be included?
what should we learn from these models?
and how to implement the LEP 2.0 differently than the previous one?

The success in tackling these questions will certainly inject new purposes and sustainability into the LEP 2.0.

KARL CL LEE is currently doctoral candidate at the School of Arts and Social Sciences, Monash University (Malaysia campus) and also serves as visiting scholar at Guangxi University for Nationalities.