Who owns malaysia

There is no group of companies under the control of one family or individual that dominates the top 20 listed corporations. None of the individuals who own any of these top 20 firms appears to hold equity in trust for influential politicians.

A number of these companies were subsequently taken over by the government, either due to the impact of the crisis or because of disputes among prominent politicians. Between and , Mahathir marginalised two influential politicians, Anwar and Daim, who had significant indirect control over important quoted enterprises. The vast corporate assets owned by the business allies of these two politicians were re-allocated to government institutions or other private individuals.

What is clear is that the nexus of politics and business based on patronage and political loyalty had only served to undermine the development of Malay entrepreneurship. There is little evidence of wealth concentration or intra-ethnic cooperation involving Chinese Malaysian firms, although it is widely believed that the Chinese work together to protect their economic interests. On the contrary, the shareholding pattern among Chinese-owned firms indicates that they function independently of one another.

The owners of the largest quoted Chinese enterprises had, in fact, established inter-ethnic ties, with influential Malays, to help them protect and expand their interests.

Similarly, there is little evidence that Malay Malaysian businessmen who own large quoted firms have cooperated with one another in business. Instead, there was much competition among them in key sectors. Halim's firm in the telecommunications sector, Timedotcom, was in competition with Tajudin's Celcom, then Malaysia's largest company in this sector. In spite of their need to restructure their assets after the currency crisis, Halim and Tajudin did not attempt to merge these telecommunications enterprises, even though link-ups with other firms in the industry were attempted.

Other Malay Malaysians, like Azman Hashim and Rashid Hussain, were in keen competition with one another in the financial sector, while Renong had a huge interest in Bumiputra-Commerce Bank. When the government called on Malaysian banks to consolidate, there were no attempts by the Malay Malaysians in this sector to merge their enterprises.

The list of the top 20 publicly-listed firms in plainly reveals the dismal failure of Mahathir's goals. Of his industrialisation endeavors, the cement industry is now well embedded in the hands of foreign firms, the steel industry is in the dock, while the car project is mired in controversy, loudly criticised for being privy to protection over and beyond what should be accorded even to a national project.

Malay capitalists were quickly created, within a decade, only to disappear even faster because selective patronage had engendered little independence or competence to deal with competition or crises. Government ownership of half of the top 20 companies was tangible evidence that privatisation had failed.

Before he retired, Mahathir provided a candid assessment of his failed policy endeavors, as well as of the lessons he had learnt. He argued that NEP patronage had contributed to a 'crutch mentality' and that the only way to promote entrepreneurship was to expose Malay businessmen to competition. The Chinese Malaysians, he said, had managed to increase their ownership of corporate equity primarily because they had been forced to compete even harder under the NEP.

What Mahathir did not state was that the Chinese Malaysians, for all their ostensible entrepreneurship, had not managed to develop brand names or move up the technological ladder.

This was mainly because they had received inadequate support from his government, a situation that had only served to curb the rise of a domestic group of entrepreneurial business people that could have helped reduce Malaysia's dependence on foreign capital to generate growth and industrialise the economy.

In this regard, then, the policy recommendations by Prime Minister Abdullah Ahmad Badawi are, interestingly enough, correct. His call that government-linked companies GLCs professionalise their management and deploy their control and ownership of corporate assets more efficiently is timely. His focus on the promotion of small and medium-sized enterprises SMEs , not of big business, as well as his plea for the need to dispense with a patronage mentality and the need to instill a spirit of competition in business to promote entrepreneurship is appropriate.

His desire to eradicate corruption and to ensure an at-arms-length, transparent relationship between government and business in the award of contracts is sensible. The real success of the NEP has been the creation of an independent professional Malay middle class, from which a new entrepreneurial community is emerging.

The rise of this new middle class was achieved through an emphasis on providing good quality education to Malaysians. Meanwhile, attempts to place wealth selectively in the hands of an elite group to promote the rise of Malay capital has led to serious intra-ethnic class divisions and to repeated intra-Umno feuding, bringing the party into disarray and disrepute.

If it is the aspiration of Umno members to sincerely promote inter-ethnic economic parity, their focus should be on providing decent education, especially to the poor. Tin exports were similarly restricted from While these measures did succeed in raising world prices, the inequitable treatment of Asian as against European producers in both industries has been debated. Malaysia had very few secondary industries before World War II. The little that did appear was connected mainly with the processing of the primary exports, rubber and tin, together with limited production of manufactured goods for the domestic market e.

Much of this activity was Chinese-owned and located in Singapore Huff, Among the reasons advanced are; the small size of the domestic market, the relatively high wage levels in Singapore which made products uncompetitive as exports, and a culture dominated by British trading firms which favored commerce over industry.

Overshadowing all these was the dominance of primary production. When commodity prices were high, there was little incentive for investors, European or Asian, to move into other sectors. Conversely, when these prices fell capital and credit dried up, while incomes contracted, thus lessening effective demand for manufactures. During the Japanese occupation years of World War II, the export of primary products was limited to the relatively small amounts required for the Japanese economy.

This led to the abandonment of large areas of rubber and the closure of many mines, the latter progressively affected by a shortage of spare parts for machinery. Businesses, especially those Chinese-owned, were taken over and reassigned to Japanese interests. Rice imports fell heavily and thus the population devoted a large part of their efforts to producing enough food to stay alive. Large numbers of laborers many of whom died were conscripted to work on military projects such as construction of the Thai-Burma railroad.

Overall the war period saw the dislocation of the export economy, widespread destruction of the infrastructure roads, bridges etc. It also saw a rise in inter-ethnic tensions due to the harsh treatment meted out by the Japanese to some groups, notably the Chinese, compared to a more favorable attitude towards the indigenous peoples among whom Malays particularly there was a growing sense of ethnic nationalism Drabble, The returning British colonial rulers had two priorities after ; to rebuild the export economy as it had been under the OIDL see above , and to rationalize the fragmented administrative structure see General Background.

The first was accomplished by the late s with estates and mines refurbished, production restarted once the labor force had been brought back and adequate rice imports regained. The bargain was institutionalized as the Alliance, later renamed the National Front Barisan Nasional which remains the dominant political grouping. In the Federation of Malaysia was formed in which the bumiputera population was sufficient in total to offset the high proportion of Chinese arising from the short-lived inclusion of Singapore Andaya and Andaya, Postwar two long-term problems came to the forefront.

These were a the political fragmentation see above which had long prevented a centralized approach to economic development, coupled with control from Britain which gave primacy to imperial as opposed to local interests and b excessive dependence on a small range of primary products notably rubber and tin which prewar experience had shown to be an unstable basis for the economy.

The first of these was addressed partly through the political rearrangements outlined in the previous section, with the economic aspects buttressed by a report from a mission to Malaya from the International Bank for Reconstruction and Development IBRD in The rationale for the Federation was that Singapore would serve as the initial center of industrialization, with Malaya, Sabah and Sarawak following at a pace determined by local conditions.

The second problem centered on economic diversification. The IBRD reports just noted advocated building up a range of secondary industries to meet a larger portion of the domestic demand for manufactures, i. In the interim dependence on primary products would perforce continue.

Each of the Malaysian territories had plans during the s. Malaya was the first to get industrialization of the ISI type under way. The Pioneer Industries Ordinance offered inducements such as five-year tax holidays, guarantees to foreign investors of freedom to repatriate profits and capital etc.

A modest degree of tariff protection was granted. The main types of goods produced were consumer items such as batteries, paints, tires, and pharmaceuticals. Just over half the capital invested came from abroad, with neighboring Singapore in the lead. Primary production, however, was still the major economic activity and here the problem was rejuvenation of the leading industries, rubber in particular. New capital investment in rubber had slowed since the s, and the bulk of the existing trees were nearing the end of their economic life.

However, the new trees required seven years to mature. Corporately owned estates could replant progressively, but smallholders could not face such a prolonged loss of income without support. To encourage replanting, the government offered grants to owners, financed by a special duty on rubber exports.

The process was a lengthy one and it was the s before replanting was substantially complete. Moreover, many estates elected to switch over to a new crop, oil palms a product used primarily in foodstuffs , which offered quicker returns. Progress was swift and by the s Malaysia was supplying 20 percent of world demand for this commodity.

Another priority at this time consisted of programs to improve the standard of living of the indigenous peoples, most of whom lived in the rural areas. Financial assistance repayable was provided to cover housing and living costs until the holdings became productive. Rubber and oil palms were the main commercial crops planted. Steps were also taken to increase the domestic production of rice to lessen the historical dependence on imports.

The markets were mainly in East Asia and Australasia. Here the largely untapped resources of Sabah and Sarawak came to the fore, but the rapid rate of exploitation led by the late twentieth century to damaging effects on both the environment extensive deforestation, soil-loss, silting, changed weather patterns , and the traditional hunter-gatherer way of life of forest-dwellers decrease in wild-life, fish, etc.

Other development projects such as the building of dams for hydroelectric power also had adverse consequences in all these respects Amarjit Kaur, ; Drabble, ; Hong, A further major addition to primary exports came from the discovery of large deposits of oil and natural gas in East Malaysia, and off the east coast of the Peninsula from the s. Gas was exported in liquified form LNG , and was also used domestically as a substitute for oil.

At peak values in , petroleum and LNG provided around 29 percent of Malaysian export earnings but had declined to 18 percent by The program of industrialization aimed primarily at the domestic market ISI lost impetus in the late s as foreign investors, particularly from Britain switched attention elsewhere.

An important factor here was the outbreak of civil disturbances in May , following a federal election in which political parties in the Peninsula largely non- bumiputera in membership opposed to the Alliance did unexpectedly well. This brought to a head tensions, which had been rising during the s over issues such as the use of the national language, Malay Bahasa Malaysia as the main instructional medium in education.

There was also discontent among Peninsular Malays that the economic fruits since independence had gone mostly to non-Malays, notably the Chinese. The outcome was severe inter-ethnic rioting centered in the federal capital, Kuala Lumpur, which led to the suspension of parliamentary government for two years and the implementation of the New Economic Policy NEP.

The main aim of the NEP was a restructuring of the Malaysian economy over two decades, with the following aims:. The principle underlying these aims was that the redistribution would not result in any one group losing in absolute terms. Rather it would be achieved through the process of economic growth, i. While the primary sector would continue to receive developmental aid under the successive Five Year Plans, the main emphasis was a switch to export-oriented industrialization EOI with Malaysia seeking a share in global markets for manufactured goods.

Free Trade Zones FTZs were set up in places such as Penang where production was carried on with the undertaking that the output would be exported. As with ISI, much of the capital and technology was foreign, for example the Japanese firm Mitsubishi was a partner in a venture to set up a plant to assemble a Malaysian national car, the Proton, from mostly imported components Drabble, Source: Drabble, , Table Bumiputera ownership appears to have stopped well short of the 30 percent mark.

Section b indicates that while bumiputera employment share in primary production increased slightly due mainly to the land schemes , as a proportion of that ethnic group it declined sharply, while rising markedly in both the secondary and tertiary sectors. In middle class employment the share rose to 27 percent. All ethnic groups registered big falls, but on average the non- bumiputera still enjoyed the lowest incidence of poverty. By the overall level had fallen to only 4 percent.

Over these three decades Malaysia accomplished a transition from a primary product-dependent economy to one in which manufacturing industry had emerged as the leading growth sector. Rubber and tin, which accounted for The post-independence state played a leading role in the transformation. The transition from British rule was smooth.

Apart from the disturbances in government maintained a firm control over the administrative machinery. Foreign capital was accorded a central role, though subject to the requirements of the NEP. At the same time these requirements discouraged domestic investors, the Chinese especially, to some extent Jesudason, Development was helped by major improvements in education and health. Enrolments at the primary school level reached approximately 90 percent by the s, and at the secondary level 59 percent of potential by In the tertiary sector the number of universities increased from one to seven between and and numerous technical and vocational colleges opened.

Bumiputera enrolments soared as a result of the NEP policy of redistribution which included ethnic quotas and government scholarships. However, tertiary enrolments totaled only 7 percent of the age group by Better living conditions more homes with piped water and more rural clinics, for example led to substantial falls in infant mortality, improved public health and longer life-expectancy, especially in Peninsular Malaysia Drabble, , , The quality of national leadership was a crucial factor.

This was particularly so during the NEP. While supporting the NEP aim through positive discrimination to give bumiputera an economic stake in the country commensurate with their indigenous status and share in the population, he nevertheless emphasized that this should ultimately lead them to a more modern outlook and ability to compete with the other races in the country, the Chinese especially see Khoo Boo Teik, There were, however, some paradoxes here.

In common with many other countries Malaysia embarked on a policy of privatization of public assets, notably in transportation e. Malaysian Airlines , utilities e.

In turn the NDP was part of a longer-term program known as Vision The aim here is to turn Malaysia into a fully industrialized country and to quadruple per capita income by the year The Malaysian economy continued to boom at historically unprecedented rates of percent a year for much of the s see next section. There was heavy expenditure on infrastructure, for example extensive building in Kuala Lumpur such as the Twin Towers currently the highest buildings in the world.

The volume of manufactured exports, notably electronic goods and electronic components increased rapidly. The Asian financial crisis originated in heavy international currency speculation leading to major slumps in exchange rates beginning with the Thai baht in May , spreading rapidly throughout East and Southeast Asia and severely affecting the banking and finance sectors.

The Malaysian ringgit exchange rate fell from RM 2. There was a heavy outflow of foreign capital. You can also choose from our range of premium add-ons, including Route Maps, Fleet Data and more.

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