Media Statement by Johore DAP Policy Director and Senai State Assemblyperson Wong Shu Qi on 17th March 2014 (Monday):


Time to curb rampant crony capitalism in Malaysia, lest we become the victims in the long run


According to the latest issue of “The Economist”, Malaysia is again ranked at the third place in the Crony Capitalism Index. This is undoubtedly another alert to Malaysians and especially our national leaders that we should do much more in order to bring our nation into the right path of economic development.


Malaysia ranked third in 2007, in the weekly publication’s statistic, yet today, Malaysia’s standing remains unchanged regardless of numerous transformation programs launched after Najib Razak took over the administration from Malaysia’s sixth PM, Abdullah Badawi.


In the ranking, Malaysian billionaires’ wealth hold nearly 20% of the total GDP of Malaysia while there is almost 100% of them involved in the “crony sectors” identified by the Economist.


The crony sectors in the definition of the publication, include casinos, coal, palm oil and timber, defense, deposit-taking banking and investment banking, infrastructure and pipelines, oil, gas, chemicals and other energy, ports, airports, real estate and construction, steel, other metals, mining and commodities, utilities and telecoms services.


Crony capitalism or rent-seeker capitalism in the definition given by the Economist “is not just unfair, but also bad for long-term growth”. Soaring property prices enriches well-connected businessmen, who rely on approvals of projects. Privatization allows tycoons to monopolize certain sectors or acquire assets with cheaper prices.


All these sound very familiar to Malaysians who have been observing the political and economic development. We have privatized airports and ports, unfair agreements that oblige the federal government to keep paying compensation to expressway companies and subsidized energy companies.


Indeed, billionaires in heavy rent-seeking industries are not necessarily being involved in graft or law breaking businesses, yet, the structure of the economy shows that we are in an unhealthy development route that makes people suffer.


Noticeably, no other country in the top 20 ranking has even greater crony involvement by billionaires if compared to Malaysia.


Moreover, Malaysia is the number 1 crony capitalism country in Southeast Asia although Singapore, Philippines and Indonesia are all listed in top 10.


It’s time for Malaysian government to curb crony capitalism for the sake of the long-term wellbeing of our people.


Wong Shu Qi