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For a
country that abhors public protests and suppresses them
with strict rules against illegal assembly, Malaysia has
had two big demonstrations in Kuala Lumpur just this
month.
With
elections expected next year, a certain rise in
political temperature isn’t surprising.
However,
two large street rallies within a month may also be a
sign that the 50-year-old code defining the rules of
engagement between the state and the three main ethnic
groups—the “social contract” of Malaysia—is fraying.
The
biggest source of discontent is race, a four-letter word
in a country where three-fifths of the 27 million people
are Malays, about a quarter of the population is Chinese
and 10 percent is Indian.
Many in
the minority Chinese and Indian communities are
disenchanted with economic policies that favor the
Malays.
And
while privileges granted to the Malay Bumiputeras—or
“sons of the soil”—can’t be taken away abruptly, the
case for separating entitlements from racial identity is
building.
There
are, of course, limits to how far Prime Minister
Abdullah Ahmad Badawi may be prepared to go and how
soon.
To the
extent affirmative-action policies make Malaysia
unattractive to foreign investors, Abdullah has already
shown a willingness to respond. The government has said
that companies setting up tourism or logistics
businesses in the Iskandar Development Region of Johor
won’t need to comply with a rule requiring foreign
companies to have at least 30- percent ethnic Malay
ownership.
Investments, trade
This is
a welcome step because Malaysia received just $6 billion
of foreign direct investment last year. Thailand got $10
billion and India received $17 billion.
Ending
preferential treatment for Malays in lucrative
government contracts is going to be more problematic.
Free-trade talks with the
United States
and Australia have been delayed and the ones with New
Zealand have had to be suspended primarily because
Malaysia’s
policy of discouraging non-Malays—including
foreigners—from bidding on government tenders is
unacceptable to these countries.
The same
issue might also jeopardize a free-trade deal between
the Association of Southeast Asian Nations—of which
Malaysia is a member—and the European Union.
1969
riots
The
Federation of Malaya’s 1957 Constitution, which was
drafted as the British were leaving, recognized that the
indigenous Malay community needed special help,
including quotas in government jobs, business permits
and university places, to improve their abject economic
standing.
The
acceptance of this arrangement by the minority Chinese
and Indian communities—“foreigners” in the land of the
ethnic Malay Muslims—was seen as the basis of their
citizenship and participation in a grand political
coalition that has ruled Malaysia uninterrupted since
independence.
Following bloody race riots in 1969, the New Economic
Policy of 1970 made it an avowed goal of state policy to
lift the share of corporate ownership for the
Bumiputeras to 30 percent, from just 2 percent.
There
was an uproar last year when a Malaysian economist
argued in a study that the goal may already have been
more than met and it was time to dismantle economic
policies based on race.
‘Sacred’
arrangement?
The
political rhetoric is still staunchly against any such
dilution of affirmative action. At his party’s annual
congress this month, Abdullah described Malay interests
and the social contract between communities as “sacred.”
However,
the economic reality is different.
Malaysia’s
annual per-capita income has jumped an impressive
26-fold in the past 50 years to 20,900 ringgit ($6,200).
But the decades of sustained, rapid growth in prosperity
are now history.
The rise
of China and India is forcing Malaysia to discover new
sources of competitiveness; in such an environment, the
policy of race-based discrimination is increasingly
untenable.
The area
where
Malaysia
has paid the heaviest price is education. In the 1980s,
government policy reduced national schools to “Malay
enclaves,” in the words of University of Sydney
political scientist Lily Zubaidah Rahim; as a result,
the Chinese opted out in large numbers.
Thus,
the ideal place to integrate the races became the
starting point of segregation.
While
ethnic quotas in higher education were removed in 2002,
university entrance norms for non-Malays are still
significantly tougher. Talent that Malaysia badly needs
to build a knowledge-driven economy is forced to
migrate.
Renegotiating the contract
The
November 10 protests called for an improvement in the
electoral process so that the next polls are free and
fair; the second rally, however, had an overt racial
tone.
The
Hindu Rights Action Force, which organized the
demonstration, is suing the British government for not
protecting the rights of the minority Indian community
at the time of independence. The colonial rulers had
brought in Indians as indentured labor to work on rubber
plantations.
The real
purpose of the protesters is, of course, to draw
attention to the unfairness of the 1957 constitutional
arrangement and to show that the Malays aren’t the only
underclass in
Malaysia.
The
Tamil-speaking Malaysians, not counting the very wealthy
businessmen such as pay-TV and telecommunications czar
T. Ananda Krishnan, remain rather poor as a community.
A
renegotiation of the Malaysian social contract so that
entitlements are realigned with real economic needs will
be a slow, challenging process, though nothing short of
it can really heal the wounds festering for half a
century. |
