Sunday, November 05, 2006

interesting posts

intersting posts by uberculturejohor
demolish causeway?
SJER... An assessment of its outcomes

Demolish Causeway?

An unexpected call from an unexpected person. The sultan of Johor took everyone by surprise when he remarked that the causeway linking Singapore and Malaysia built by the British be demolished as the building of the Causeway by the British was to deliberately prevent ships from passing local waters, resulting in the development of Keppel Port in Singapore instead. He urged for the causeway "to be removed to allow ships to pass”.

In Malaysia, where the sultan of each state remains as a constitutional monarch and also remain outside politics, they almost never comment on political issues. Naturally when the Sultan made this comment it dumbfounded everyone on both sides of the Straits.

Nobody can deny the Sultan of Johor, though he may not have expressed his views in the way politicians on both sides of straits like to hear, has merits in his claims. Indeed the causeway is obstructing free flow of ships and is also adding to environmental degradation of the straits. Also a bridge to replace the causeway will definitely make the massive traffic jams twice a day either history or less of a problem to users. Politicians on both sides continue to neglect the welfare of the users of the causeway who truely suffer from long waiting times, smoke and other pollutions. The only remedy to this is the construction of a bridge and demolition of the current causeway.

Singapore political party which maintains a kind of unstable relationship with the Malaysian side however has a very cordial relationship with the Sultan of Johor. Therefore it is impossible for Singapore to ignore the Sultan's remark. In Singapore where there has been a meticulous effort to dismantle the British colonial tradition as far as possible such as through dismantling the Priving council, doing away with a lot of British practices such as wearing wigs in court etc, the causeway has been one British remnant that Singapore refused to do away with.

The mission of this blog when i first started had been from the beginning articulated as "build bridges not walls". Though the causeway is physically a bridge it always right from the beginning of the time the British constructed it, has served only as a psychological wall and has remained to be so for almost a century. There was once a Canadian friend who told me,while discussing the Israeli wall, that all walls will come down and true enough when we analyzed we found every wall every society built did come down with time. I am pretty much confident the lessons of history will allow us to asset, that sometime in future, the causeway will indeed only go. I hope it will be in the time of the Sultan of Johor for him to see it.

SJER... An assessment of its outcomes

The announcement of the Malaysian federal government's investment into Johor to the tune of RM17billion to develop South Johor Economic Region(SJER) begs some assessment of its outcomes.

PM Abdullah's setting the quality of life as one of the focus of SJER is commendable. Indeed not every mega project improves the quality of life and should this be a conscientious focus of the development of SJER it will improve the quality of life of whatever population the project will involve.Therefore it is important at this juncture for the policy makers to define whose quality of life will be the focus. Will it be every Johorean? Or will it be only those who finally be residing within the SJER. It will be indeed ideal to tie the welfare of the poor in Johor to this project. One possible way is to set up modern kampongs and relocating squatters and those living in low income poor housing to these modern kampongs.

It is also commendable that the PM Abdullah has stated that "major housing developments would take place to cater to the expected growth in population and that amenities such as schools, hospitals, transportation links and recreational facilities would also be provided". However the policy makers need to show that these developments will be equitable in adding to the welfare of all income groups, gender and ethnic groups. Secondly physical infrastructure development has to go along with institutional infrastructure such as critical mass of experts, legislation to regulate externalities, regulators, good centres of training of experts, good collaboration centres, think tanks, etc. The former chiefly requires money only while the latter requires capable, ethical, intellectual and motivated champions within the bureacracy. As long as the institutional infrastructure is not developed to go along with the physical infrastructure, the developments will loose more than half its worth.

Three areas of development zones have been identified. Firstly the strengthening of Johor as a "logistical hub by leveraging the ports of Tanjung Pelepas, Johor Port and Senai Airport". This is a brilliant move and requires not much mention of the merits of this focus. However the marketing of these ports and airport needs to be improve dramatically.

Another two areas of development is the "development of new service-based industries such as cyber-centres, medical hub, an international finance centre, a creative industries park, a biofuel centre and a centre for halal manufacturing" and "Human capital development in the form of an Education City featuring universities and R&D institutions of world-class standing."

I am sorry to say but I am not confident Johor can make these areas of development possible. These statements to me, as an economist, only strike me sweeping statements of politicians. It is logically, realistically and virtually impossible for Johor to achieve these two areas of development since it has no critical mass of experts to materialize this. Bureacrats and politicians have absolutely no skill or ability in successfully implementing this. Their reliance on businessmen, marketting and business admin dudes and technocrats will only be relying on the boatmen to fly the plane. They need a generation of talent, skills and experts who really have the know-how for this. Malaysia as a whole has this critical mass but unfortunately their talents, skills and expertise are mismatched to the jobs they currently perform for bread and butter. This is typical for not just Malaysia but every ASEAN economy that sadly has only matured to cater to the few professions such as accountants, lawyers, IT dudes, marketing dudes etc. These technocrats unfortunately are not really the people who can champion such implementation. They can talk the talk but never walk the walk as they lack the skills. Bureacrats and politicians in Johor need to understand this and take an unprescedented step to have the development of SJER be implemented by real professionals by attracting them from all across Malaysia and themselves taking a back seat monitoring approach.

PM Abudullah correctly identified "security, infrastructure, drainage, river management and traffic improvement" as other key areas of development. These are indeed critical to support the development of the above. Security is a major area which frankly even though is not as lacking as regional media portrays, greatly requires a radical turnaround to stop the media rumour monggers.

In all the bureacrats and politicians also need to look at three macro issues to assess the outcomes of the development of SJER.

Firstly the economic welfare of Johoreans. Will there be an equitable distribution of the benefits of this development or will only some enjoy the fruits of the labour. At what cost will this development come? Will the culture, environment, landscape of Johor be preserved but improved? Will the development resolve key economic issues that Johoreans face such as in basic public infrastructure, social infrastructure etc?

Secondly the sustainability of the development. Can the development and growth of SJER be sustained over time? This totally relies on the development of critical mass of experts and institutions.

Thirdly how can the funding for the development of SJER be improved? Indeed for those areas of SJER where there are fast and clear monetary benefits, it will be worthwhile to fund them using 10 year bonds backed by the Federal funds, which have been already promised, as collateral. This will tremendously increase the productivity of the capital allocated for the development of SJER.

Indeed I am excited by this development of SJER and I only hope to see it succeed. Unlike many fellow kiasu Singaporeans who naively believe that the growth of neighbours will only be at the detriment of our own welfare and growth, I staunchly believe the contrary simply because empirically it has been proven otherwise for hundreds of years. (refer to my earlier post of the jealousy of trade by Humes)


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