KUALA LUMPUR: Human rights organizations have accused the Malaysian government officials confirmed to Bikyamasr.com on Sunday that the deportations had in fact taken place, but denied that any of the workers had been caned due to their violations in the country.
“They are being deported because they violated labor laws and nothing more,” the official, speaking on condition of anonymity, told Bikyamasr.com, denying local rights group’s report that dozens of the workers had been caned. Bikyamasr.com could not confirm these reports.
The workers will be temporarily sheltered in Tanjungpinang, Riau.
“We will provide temporary shelter before sending them to their villages of origin,” troubled migrant worker chief Juramadi Esram said in Tanjungpinang on Friday.
Juramadi said that the workers failed to show valid documents to work in Malaysia and most of them had entered Malaysia on tourist passports.
One of the workers, Ari, said that they were treated roughly during their detention in Malaysian prisons and that their belongings were seized by the Malaysian authorities.
“Nothing’s left but the clothes on our backs. Everything has been taken by the Malaysian police,” Ari said as quoted by Antara news agency.
Some workers were also reportedly caned as punishment for their legal violations.
It comes as Malaysia and Indonesia face a number of setbacks in discussing trans-migrant labor issues and the issue of maids has also been at the heart of the growing disputes.
Many in the country believe that the added restrictions for Indonesian workers will result in less workers arriving in Malaysia or Singapore, meaning there could be a workers shortage in the near future.
A group of protesters wearing burqas gathered in various places in Sydney today to argue for Australia to ban the face veil.
They say the wearing of the Islamic headwear donned by women, should be outlawed because they pose a security risk.
Security and police were called when the burqa-clad non-Muslims incited anger outside state Parliament House.
Members of the public were extremely offended by the male protesters wearing the burqa.
Zubeda Raihman from the Muslim Women's National Network says, "I think it is pretty offensive because we live in this democratic country and we are given the freedom of choice."
The group ventured to the Downing Centre Local Court, a city pub, a bank, and the NSW Parliament House.
KUALA LUMPUR, April 2 — Datuk Seri Najib Razak said tonight he will announce a minimum wage policy by the end of the month despite stakeholders still deadlocked over whether benefits can be considered part of a floor wage.
The Malaysian Insider reported today that employers and workers argued in a recent National Wages Consultative Council meeting over whether allowances and other benefits can be included as part of a base wage expected to be set at RM900 and RM800 for Peninsular and East Malaysia respectively.
The committee, which advises the government on wage policy, had met on the back of small-medium industries (SMIs) warning that 80 per cent of active businesses could fold under a blanket floor wage, cutting four million jobs from the labour market.
The prime minister was initially slated to announce a base wage policy last month but The Malaysian Insider understands that pressure from employers has forced the government to return to the negotiating table although any delay will upset trade unions which have said that a minimum wage is long overdue.
“The government has recently announced a pay hike of seven to 13 per cent for 1.4 million civil servants. For the private sector, I will announce the implementation of a minimum wage at the end of the month,” the prime minister said in his live televised address after receiving reports of his national transformation plans.
The Malaysian Insider reported that the 16 mainly Chinese industry associations that called a press conference on March 6 to ask for a staggered implementation of floor wages had first sought out MCA president Datuk Seri Dr Chua Soi Lek for help before lobbying Putrajaya directly.
The Barisan Nasional (BN) government, which has been unable to win back Chinese support so far, has since held several meetings with the associations that are largely made up of SMIs.
Bloomberg reported last month that government officials are preparing for June 3 federal polls and Najib is due to announce a minimum wage of just under RM1,000 a month to win support from low and unskilled labour that makes up 75 per cent of the workforce.
Households earning under RM1,500 per month also make up 40 per cent of the population.
SMIs say they make up 99 per cent of operational companies and employ 59 per cent of all workers as they are the most labour-intensive outfits and will be hardest hit by a hike in wage bills.
They have instead asked for certain sectors and micro-enterprises to be exempted. They also want to be given anywhere between 12 and 18 months to implement a minimum wage.
But labour unions insist that such demands are unreasonable as the minimum wage is to be reviewed every two years.
However, they do not think these will develop into a storm.
PETALING JAYA: The historic win by Myanmar opposition leader Aung San Suu Kyi and members of her National League for Democracy in Sunday’s by-elections will send ripples in Malaysia, but not enough to develop into a storm that will topple the incumbent Barisan Nasional government.
This was what several political analysts told FMT today. They agreed that the global trend of changing old guards – evident in the Arab world and now in Myanmar – would influence Malaysian politics, including the way voters would cast their ballots.
Universiti Putra Malaysia’s Jayum Jawan, who teaches politics and government, said:
“No country is immune to the winds of change. It is already happening. People are already having this euphoria. If any ruling party wants to remain relevant or return to power, it has to change and govern to reflect what the people want.
“These old guards are people who are out of tune with the current scenario. The people cannot accept them any longer and those leaders are swept away with the currents of change that is taking place around us.”
He noted that both BN and Pakatan Rakyat were talking about change, but he said no one was “making a big move”.
“We see minor changes and I don’t know if that is acceptable to the electorate. BN, PKR, PAS, are all changing. For example, PAS is no longer the Islamic and Malay party of the 90s. But it is now reaching out to non-Malays and non-Muslims. Whether this is enough will be tested in the next general election.”
Jayum described such changes as “minor adjustments”, not the “big bang” that the people wanted.
“When the BN talks about winnable candidates, it is talking about expired politicians being rejuvenated again. Is that change? We have to give way to young people who are hungry to participate in nation building.
“Extensive change needs to come from young people with good ideas, not old people who are conservative. They have to address the needs and wants of young Malaysians who no longer talk along ethnic lines.”
Jayum added that the concept of 1Malaysia was good, but the implementation was lacking.
Ooi Kee Beng, the deputy director of the Institute of Southeast Asia Studies (ISEAS) concurred that Suu Kyi’s victory gave some optimism to the Malaysian opposition.
However, he cautioned against seeing too much relevance for Malaysia in international political developments, saying local conditions were different from those in Myanmar and the Middle East.
“Malaysia’s inner dynamics and conditions are very different,” he said.
“There is definitely a sense of optimism in the air. But Malaysians are very sensitive of race and religion and
however dangerous things get, they will not do things that will lead to violence.”
He said the issue in Malaysia was not about achieving a revolution but rather changing the government.
“In the case of the Arab Spring, there was an uprising and people didn’t know what to put in place of the old regime. In the case of Myanmar, our conditions are different from theirs.”
Contrary to the developments in those countries, he added, the opposition in Malaysia had managed to consolidate its position to some extent.
“In Malaysia, the opposition has managed to articulate their views and capture what is wrong and want to change it. They can argue with the incumbent.”
Status quo expected
Universiti Sains Malaysia’s Sivamurugan Pandian said the Myanmar and Arab experience would have an effect on how Malaysians vote, but mostly in the urban areas.
He said he did not expect BN to lose in the coming election. “It will remain very much a status quo. Maybe the changes can happen in the 14th or 15th election if BN does not change more drastically by then.”
He said the BN leadership at the top level had changed and that this was most apparent in Prime Minister Najib Tun Razak. However, he lamented that since 2008, the two rival coalitions had focused so much on each other’s weaknesses that they had neglected explaining their policies.
“They are focusing on character assassination,” he said, “and voters now see these things as pointless.”
Mohammad Agus Yusoff of Universiti Kebangsaan Malaysia said that no country in the world could rule forever without people standing up against injustices.
“The regime that is not democratic and is autocratic has to change its political style,” he said. “You cannot go on ruling the country with your own political style of intimidating the people. People are more open now. They know their rights. They want to participate in politics.
“Everything on the market has to be up to date. In Myanmar, people waited for so long for Suu Kyi to lead them.”
He described BN as neither autocratic nor fully democratic. “Sometimes it is very open, sometimes it is not. Sometimes it looks like it wants to change. And we wait for it. But the reforms don’t come.
“There are things like ETP and GTP, but let’s wait and see if these are good.”
“Changes have to be firmer, clearer, so that the people do not only hear about them, but see and feel them too.
“So far, BN has been inconsistent. Flip-flopping is so common. For example, the Peaceful Assembly Bill was to enable more freedom, but in actual fact it has effectively stopped people from going for street protests.
“You talk about 1Malaysia, it sounds good. But Umno members are still talking about Malay rights and so on. That’s the problem, you are not walking the talk.
“Some things have to be changed and realigned. If what we are seeing go on continuously, it is not good for the BN, for the government, or for the people.”
“Demontrasi jerit ramai-ramai di jalan...orang (kerajaan) tidak berapa dengar sebab ramai yang jerit.”
KUALA LUMPUR: Parlimen Belia mampu menjadi saluran terbaik bagi golongan muda menyatakan pandangan berbanding bersuara melalui demonstrasi jalanan yang menjadi budaya pembangkang.
Timbalan Menteri Belia dan Sukan, Datuk Razali Ibrahim berkata pihaknya percaya pendekatan tersebut mampu memberi pendedahan dan pemahaman yang lebih bertanggungjawab mengenai amalan demokrasi negara.
“Berdemonstrasi, jerit ramai-ramai di jalan…orang (kerajaan) tidak berapa dengar sebab ramai yang jerit. Melalui Parlimen Belia ini kita boleh bawa usul dan akan melihat sendiri prosesnya dari satu fasa ke satu fasa yang lain.
“Melalui langkah ini juga kerajaan dapat melahirkan anak muda yang lebih bertanggungjawab agar tidak memilih demonstrasi jalanan satu-satunya pilihan untuk menyatakan pendirian, tetapi memilih saluran yang lebih bermanfaat,” katanya dalam satu sidang media di Parlimen pada Isnin.
Menampilkan konsep yang sama dengan proses demokrasi dalam Dewan Rakyat, Parlimen Belia itu nanti akan dianggotai golongan belia yang akan bersidang dua hingga tiga kali setahun termasuk sesi taklimat bersama Perdana Menteri Datuk Seri Najib Tun Razak.
Satu jawatankuasa khas terpilih juga akan dibentuk bagi membincangkan isu-isu tertentu terutamanya isu membabitkan belia, kemudiannya isu itu nanti akan diambil perhatian oleh kementerian yang terlibat.
Wakil setiap Parlimen
“Pada perancangan kita Parlimen Belia akan bermula setelah habis Dewan Rakyat dan Dewan Negara…ini dalam perancangan, kerana kita mahu gunakan dewan yang sama.
“Belia yang dipilih akan mewakili 222 kawasan Parlimen.
“Kita mengharapkan Dewan Rakyat digunakan sebagai tempat Parlimen Belia ini bersidang. Jika tidak kita terpaksa bina yang baru,” katanya.
Katanya, ketika ini Kementerian Belia dan Sukan (KBS) dan Majlis Belia Malaysia (MBM) sedang menjalankan proses memilih wakil belia di setiap parlimen.
Mereka yang ingin mewakili parlimen masing-masing boleh membuat permohonan secara terus atau atas talian di laman web MBM.
Permohonan terbuka kepada mereka yang berusia 18 hingga 30 tahun mengikut alamat kad pengenalan dan perlu mendapat tandatangan sekurang-kurang 50 orang belia di kawasan mereka.
Selain itu mereka perlu menulis esei agar jawatankuasa pemilih dapat mengenalpasti tahap pemahaman mereka terutamanya dalam megupas isu semasa.
3 has been getting people into the cinemas, Kolaveri Di and Dhanush being the prime reasons.
There seems to be a new god in Tamil Nadu. Rajnikanth’s son-in-law, Dhanush.
Married to the bus-conductor-turned-Tamil-superstar, Rajnikanth’ elder daughter, Aishwarya, Dhanush turned into an unbelievable phenomenon some months ago when his song, Kolaveri Di for the film, 3, raged like a tornado in viral space. It got millions of hits on YouTube.
Even today, nobody can explain the craze for the number. Dhanush the singer is no Mukesh or Mohammed Rafi or TM Soundararajan or Pandit Jasraj. The lyrics are bloody murderous. There is no melody to speak of. Rather the song sounds like cacophonous din.
Yet, Kolaveri Di pushed men and women, girls and boys into a rapturous state. Although it is in Tamil, I am told burly Punjabi men were seen getting drunk on the number.
I would presume that the attraction for Kolaveri Di stems from the kind of appeal Dhanush has been garnering in recent times.
Once dismissed by critics as a “pigeon-chested paanwala on probation”, Dhanush must have sprayed betel-leaf juice on them when his Aadukalam (Playground) won him a National Award for Best Actor in 2011.
As a guy organising cock-fights in Aadukalam, Dhanush essays a character he appears to have specialised in, that of an underdog.
Unimpressive to look at with not even a worthwhile screen presence, Dhanush though exudes immense confidence. In the movie, his rooster not only triumphs in the end, but its master gets the girl as well, pretty Taapsee as Anglo-Indian Irene.
Now who says, women seek Adonis? Obviously, parts of this sort have made Dhanush an iconic figure that boys/men look up to, especially in their moments of agonising frustration.
Kolaveri Di could not have come at a better time. Dhanush’s fans must have seen this song as one more feather on their hero’s cap.
Career-best performance in 3
And, honestly, 3 did not disappoint, at least the first half. As schoolboy Ram experiencing his first love (with Kamal Hassan’s daughter, Shruti, playing Janani), Dhanush gives his career-best performance.
Shy, hesitant and yet determined to get the girl, he is marvellous. Later, as a business tycoon, Dhanush conveys the angst of a man faced with a perilous dilemma which threatens his new-found wedded bliss.
Directed by first-timer Aishwarya, 3 impresses during the early years of its protagonist’s life. Those stolen glances, the bicycle rides, the spin on the motorbike have all been handled with feeling, and splendidly acted out.
But 3 dives in the second half, the plot meandering into illogical paths.
This is precisely where the narrative begins to falter. Ram is ill, but Janani does not know. Ram does not want to tell her. Only his friend, Senthil, is kept in the loop. But why couldn’t Senthil talk to Ram’s rich father? No explanation! So, what begins as a promising plot dithers along the way.
However, performances are lifting. Shruti reminds us that she is her mother, Sarika’s (and Kamal’s) daughter, giving a top-notch portrayal of a woman torn between love and fear, though she goes overboard in the emotional scenes.
Well, 3 has been getting people into the cinemas, Kolaveri Di and Dhanush being the prime reasons.
Will the work get the boxoffice jingling? If it does, Dhanush may well be the new god — father-in-law Rajnikanth now showing first signs of fading away.
Gautaman Bhaskaran is a Chennai-India based author, columnist and film critic, and can be contacted at firstname.lastname@example.org. He is an FMT columnist.
If MCA, which is a just a sidekick to Umno is worth RM4 billion, then Umno must be worth five times that – let’s say RM20 billion.
Why is former prime minister Dr Mahathir Mohamad, who is well into his 80s, which, theoretically speaking, places him in the twilight zone, still at it?
It’s as though he is the parallel prime minister running this country.
The fact that he does what he does quite consistently suggests that current Prime Minister Najib Tun Razak, despite his social media savviness, requires hand-holding to lead this nation.
It also suggests that despite his external popularity, Najib lacks substance to run this country.
So if you asked me whether Najib can reform Umno, the answer is no. How can he dismantle a system on which Umno survives?
That will be the end of Umno civilisation. Umno’s civilisation lives on a system of tender-preneurship.
Every level of Umno leadership looks up at the party being able to give out tenders so that Umno is worth at least five times the worth of MCA.
If MCA is rotten, Umno should also be five times as rotten.
Mahathir seems to concur. He once suggested that Umno is rotten to the core. But of late he has been singing praises about Umno.
Mahathir wants privileges
Don’t forget he also once declared that the government is corrupt from top to bottom. When he spoke of that kind of corruption at a lucheon with former ministers, he included the current prime minister.
But now Mahathir is saying good things about the government and is suggesting that voters re-elect the party irrespective of the quality of people who make it up.
How can a party not be corrupt if the people making it up are corrupt?
The fact is Mahathir is a despotic ruler. He eschews democracy. He uses democracy to achieve the position of power.
Once ensconced in power, Mahathir pursued only one aim – conferment of privileges on himself.
His recent remarks about the futility of questioning what happened to MAS in the 1990s, is symptomatic of the man, pursuing only one goal in his life – the entrenchment of privileges.
Privilege itself is anathema to democracy which is essentially about egalitarianism.
Mahathir doesn’t want anything egalitarian. He wants privileges in the form of selected captains of industry, in the form of protection of his children and friends doing business and so forth.
The most damaging to us, is his insistence now, to perpetuate the rule of a corrupt and deceitful government led by a corrupt Umno and Barisan Nasional.
Umno worth RM20 billion?
Look at MCA. It has declared its worth at RM4 billion. How on earth can a political party be worth RM4 billion?
This can only happen if it has tentacles in business. Political parties don’t do business.
If they do, and like MCA which is worth that, they must have achieved that by the abuse of power and trust.
My point then is, if MCA which is a just a sidekick to Umno is worth RM4 billion, then Umno must be worth five times that – let’s say RM20 billion.
The question now is, how did Umno achieve that figure?
Just like MCA it must have achieved that financial clout by having businesses which it acquired by using powers given to it by the rakyat.
What do you call that? It’s called abuse of power, or simply – naked abuse of power.
The writer is a former Umno state assemblyman but joined DAP earlier this year. He is a FMT columnist.
All the Indians want is the right to life but the prime minister is not listening to their pleas. COMMENT
Indians in the underclass in particular are not asking for the sun, the moon and the stars for themselves from the powers-that-be. All that they are asking for is the right to life as guaranteed by Article 5 of the Federal Constitution.
In return, as simple logic dictates, the ruling party can hope for their continued support instead of driving them into open rebellion.
Nowhere is “denial of the right to life” best illustrated than by the fact that Indian applicants find it extremely difficult to secure even cendol licences, to cite one simple example, from the local authorities.
These officials are evidently so mean that they prefer to give out cendol licences to Indonesian applicants, Johnny-come-latelys, rather than approve one for an Indian applicant whose ancestors probably came to this country some 2,000 years ago to set up the first Hindu kingdoms in Kedah, Perak and Malacca.
Again, cendol licences are just one example of how mean the local authorities are to the Indian community.
Human Rights Party (HRP) protem secretary-general P Uthayakumar has in fact compiled a list of the various ways and areas where the authorities are denying the Indian community the opportunities to venture into self-employment and small businesses.
The local authorities in the towns and cities appear to be the main, but not the sole, culprits.
The meanness, reflected in institutionalised discrimination and police brutality, is the breeding ground for Indian gangsters in the country, not Tamil films as cited by Bukit Aman. Anyone who points the finger at Tamil films, or Hindi and other Indian films for that matter, has not been watching these films of late.
The highest ambition of an underclass Indian is not to be a gangster in preparation for a career in politics and related occupations.
Not every underclass Indian can be a doctor, lawyer or engineer either or has a strong academic foundation to do so even if there’s no shortage of the grey matter.
It’s not in the Indian psyche either to aspire to be a white-collar criminal. Indians, being by nature religious, swear by karma.
Still, there’s a limit to meekly accepting one’s lot in life even among the underclass.
Again, Indians in the urban and suburban areas, especially those displaced from the great estates dotting the length and breath of the country, don’t want the authorities to squat on them when it comes to venturing into petty trade, hawking and various small businesses or driving taxis, vans and lorries and the like.
Unfortunately, the truth is stranger than the fiction, as evident in Uthayakumar’s listing.
Ignoring the stark reality before his eyes, Prime Minister Najib Tun Razak generally continues to talk down to the Indian community. He has yet to accept that there’s nothing free in this world.
He has his eye on the Indian voters who decide the fate of 67 parliamentary seats in Peninsular Malaysia but, at the same time, refuses to extend his “Let’s make a deal. You help me, I help you” Sibu Formula to them, that is, “GuaTolongLu, Lu Tolong Gua”.
MIC leaders, long divorced from the underclass, maintain a discreet silence, thinking more of themselves and where they can next secure a grass-cutting contract from the authorities so that their wives can probably deck themselves out in even more gold from hand to foot to impress the neighbours, if not keep up with the Joneses.
Najib’s talking down to the Indians includes promising them millions on paper for their schools, temples and associations. None of these pledges have materialised so far. He should be billed at least for the giant garlands that they naively continue to buy for him and his wife, Rosmah Mansor. Once, the Hindus even installed a huge cut-out of Najib which dwarfed Lord Murugan at Batu Caves but to no avail. The Indians continue to be left empty-handed.
Apparently, Najib has decided that the best way to deal with the Indians is to continue hoodwinking them. At the same time, he has the cheek to accuse the national opposition alliance of being full of hot air and indulging in nothing more than mere lies.
Is this Najib’s way of winning the nambikei (trust) of the Indian community and ignoring, in the process, their plea for urimei (rights)?
No one should have to beg for his or her rights in this country. Everyone including foreigners, whether legal or otherwise, has rights.
The key to the ruling Umno winning the nambikei of the Indians is to recognise their urimei, beginning with the underclass Indians.
For starters, Najib should cut out the bull and ensure that the Federal Ministry of Local Government and Housing direct local authorities in Peninsular Malaysia to eliminate all forms of discrimination, overt and covert, against Indians.
That would immediately help create a situation whereby Indians, in particular the underclass, can start at the very bottom, if necessary, in self-employment and business and work their way up, even to the top. The nation as a whole can only benefit in this way.
If the stumbling blocks placed by the powers-that-be against the Indian community are not removed, they will continue to be relegated to doing the most dirty, difficult and dangerous jobs (3D) which would otherwise go abegging in the country. The lot of the Indian community should not be confined to doing just the 3D when such jobs in any country, especially a middle income one, are generally carried out by foreign labour that come and go.
Already, the 450,000 stateless Indians estimated by Hindraf Makkal Sakthi and HRP to be in the country, lie at the bottom of the dung heap, condemned to the 3D job sector forever.
Hopefully, the resolution of the personal documentation of the stateless throughout Malaysia is work in progress, as publicly pledged by the National Registration Department (NRD) on numerous occasions.
The stateless continue to live in fear in a legal twilight zone, virtually in hiding, and it’s for the NRD to reach out to these unfortunate people who are plagued by ignorance and illiteracy as well. It’s not the done thing for the NRD, from time to time, to deny that the problem exists or to imply that if it indeed does, it could not be that big or serious.
The acquisition of technical skills is another area where Indians, especially the underclass, needs the government to adopt more inclusive policies.
At present, the Indians are being pawned off by cosmetics and tokenism unless the government can produce figures to prove that it is sincere in not denying the Indians their rightful place in the sun.
It’s doubtful that even one Indian has been sent to Japan for technical training under the government’s Look East policy. This omission continues to be reflected at home as well although to a lesser extent.
If a start can be made with the underclass, other Indians will be convinced that the government will say what it means and will mean what it says when it comes to their lot in life.
The problems are myriad – 101 Indian issues as identified by Hindraf-HRF – and, put in a nutshell, in the form of 18 Points.
Both organisations have been making an annual pilgrimage to the Prime Minister’s Department with a memorandum on the 18 Points but to no avail so far. This year, they did not only satisfy themselves with another copy of the memorandum for the prime minister in late March but also presented one to the King on Feb 14, Valentine’s Day.
If the 18-Point memorandum is not worthy of consideration by the government, what else is there for Najib to talk about with the Indian community? He should not continue to waste his time trying to cajole, persuade and woo them in the manner that MIC has been doing on Umno’s behalf until 2008.
If the unregistered status of HRP and Hindraf is a problem, it’s within the government’s power to recognise these bodies once and for all instead of sending them racing to the court to seek judicial reviews and the like.
The BRICS concept as a building block of a new world order is not just an empty gesture which allows the five countries – Brazil, Russia, India, China, South Africa -- to preen themselves in a mirror. It is positively dangerous because if it does anything at all it will be to provide the five with mutual support for narrow national interests and to erect new barriers to global trade and capital flows.
Discussion at the BRICS summit in Delhi last week included an idea for a BRICS- built development bank providing finance for other developing countries free from western theories and prejudices. But in practice only one of the five, China, is in any position to provide major long-term funding for such an institution. Its massive reserves reflect not just flows of short-term money but years of surplus on trade and long term capital accounts.
Not so the other four. India’s reserves are owed more to short-term Non-Resident Indian deposits than long-term capital, and its current account remains deeply in the red. Russia has impressive looking reserves – but ones which could melt away very quickly if oil goes back to US$60 a barrel. Brazil likewise has been buoyed by high commodity prices yet is still struggling to sustain growth and keep its current account in the black. As for South Africa it is not really big enough to count as a BRIC at all. It is there because Africa needs to be represented for political reasons, not because it is more important than Indonesia.
Nor does any of the five, even China, have a currency regime and capital market which enables it to underpin the proposed bank with capital in convertible currencies – other than those of non-BRICS. Thus a financing arm would either have to use dollars, euros and yen or – worse – involve barter deals based on BRICS currencies.
More worrying than this piece of nonsense however are the actual economic policies in place or currently proposed for the member states. Russia may not be sliding back into Soviet-era central planning but it has yet to show that the oligarchic form of pseudo-capitalism which emerged with the Soviet collapse is being superseded by one in which Russia’s many skills are free to flourish in a competitive environment. As a very latecomer to the WTO it is at best feeling its way to operating in a global environment in which it does not depend on oil income and its freest, if least acknowledged, sector, agriculture.
China is surely a global trade player but whether it will remain committed to relatively free trade when the benefits it has enjoyed for 20 years from other countries’ open markets are no long so attractive, remains to be seen. What we do know about China’s economy is that for all the talk of continued liberalization, there has actually been a strengthening of the power of the state-controlled sector. Yet because China is seen as a model of success its influence on other BRICS, let alone the bigger group of developing countries, is likely to promote state capitalism at the expense of the genuinely private sector and open competition.
The shine has come off India too for the time being. In this case the problem is not so much that of state enterprises – protected as many are through preferential treatment. It is the uncertainty of laws and rules in a country where politics are in almost constant turmoil and ministers are either venal or blow with the prevailing political winds. Government deficits caused by consumer subsidies are one problem, raising the cost of capital. But given the good return to private capital in India this is far less of a problem than arbitrary laws and imposts. Recent cases of retrospective taxation, large-scale graft and blatantly unequal treatment of local and foreign, state and private firms are not just negative for India.
Transplanted to the international arena by political leaders who like to enhance state power for their own pecuniary interest. India would again have a negative impact on global trade, and the attitudes of other developing countries, that it did in the 1960s and 1970s. Meanwhile it is likely to see China’s relative outperformance as due to Beijing’s mercantilism than to India’s failures to reform.
Like China and India, Brazil has come a long way in the past 15 years of opening up its economy and pursuing broadly sensible policies. But here too the tide may have turned. It has not been content with measures to bring down its commodity-inflated currency to make its manufactures more competitive. It has raised barriers to many foreign goods, particularly from China. Competition from its BRICS partner has not created solidarity among the five but induced Brazil to appear to start to go backtrack after years of liberalization. Brazil has a history of high tariff barriers and state capitalism. In the 1960s this seemed successful for awhile in raising growth rates but then led to years of stasis because capital was used inefficiently and protected industries stagnated. Will the BRICS doctrine lead it back to that era?
Debt problems in the US, Europe and Japan are worrying. But they are less worrying for the globe than the creeping retreat from liberalism among the countries which are supposed – at least according to themselves -- to be the future leaders. The interests of very large countries anyway tend to be different from those of the small and medium sized ones, like Turkey, Thailand, Mexico and Morocco, which are the majority. Being less self-sufficient, they thus have greater interest in free trade. They are less likely too to indulge in the BRICS goal of reducing bilateral trade imbalances among them, a sure cover for managed rather than free trade.
With US leadership of the global system slowly on the wane it is natural that other countries want to play a large role. But the BRICS’ attempt to arrogate leadership to themselves will not only not work but could do lasting damage to the world trading system and hurt the small and medium size developing countries more than any.