The article ‘Najib Merely Modelling Dr M on FDI’ by Kua Kia Soong was yet another attempt by him to vent his personal vendetta against Mahathir and in the process camouflaged the real issues now confronting the country.
To begin with, Mahathir’s ‘Look East’ policy was not confined to Japan alone. It included South Korea, Hong Kong, Taiwan and even to some extent, Singapore. It would have included China (People’s Republic of China), if the country was ready then. It is mischievous to equate Look East to Japan alone, although at that time Japan’s success was the model for many other countries, not just Malaysia.
Second, Mahathir’s Look East policy was a deliberate choice, not a helpless obligation. Malaysia picked and chose the investments it needed. The bulk of the investment was for manufacturing. In real estate and infrastructure developments, Japanese and South Korean companies came in mainly as contractors, not as buyers. Malaysia did not sell lands and infrastructure projects to foreigners and then consider them as foreign direct investment (FDI) at that time.
Third, we must consider the costs and benefits of Mahathir’s Look East policy. Did Mahathir give ‘overpriced’ projects to Japan and South Korea? Did he borrow massively from Japan and South Korea to finance these projects? Did the Japanese and South Koreans own the first Penang Bridge, Dayabumi and the Twin Towers today?
As for FDI into manufacturing, there was hardly any risk for Malaysia. Foreigner investors are solely responsible for the loans and the profitability of their investments.
Can we say the same now? Did we do any comparative cost study for all the projects to be undertaken? Are these projects feasible or even needed to begin with? How much borrowing are we incurring and who will ultimately own these projects?
Fourth, I think it is sweeping to blame Japanese investments as ineffective in promoting skill-intensive industries or new technology transfer. Ultimately, how quickly we are able to transform our economy would very much depend on ourselves.
I remember Malaysia was labelled a tiger economy in the late 1990s when Japanese, South Korean and Taiwanese investments flowed in in earnest? How would Malaysia be labelled today based on the new waves of foreign money now flowing into the country?
I think the lesson to be learned from Mahathir’s Look East policy and the present waves of investments from China and Saudi Arabia is “not to blame others”.
If Malaysia is hard-up for foreign money, we can’t be choosy on the type of investment we need. When Malaysia is in need of bail outs, we can’t strike a hard bargain with foreign investors. If we have poor governance, we would not care much on the feasibility of the projects.