[ Laman Ehwal Semasa ReformIS ]
Date: 05 Aug 1999
Time: 21:24:09
Remote User: -
Today's Issue Of "The MALAYSIAN"
Electricity rates to go up If UMNO and the BN wins the next elections, you can expect your electricity rates to go up next year by as much as 8% or about 2 sen per kilowatt-hour to 25.5 sen.
Every one sen increase in rates gives Tenaga Nasional an additional RM525 million in profits. So, a 2 sen increase would give an additional RM1.05 billion in profits. Tenaga’s profits for the current year are expected to be around RM974 million. With the expected tariff increase, Tenaga’s profits are projected to be about RM2.2 billion in 2001.
Why does Tenaga need such profits? Three reasons:
a.it’s got to cover losses made in a badly-advised adventure in Pakistan costing RM1.7 billion, b.it’s got to cover all those expensive deals with the independent power producers such as YTL Power, and c.it’s got to cover its huge foreign debts.
Furthermore, Tenaga also has to perform face-saving service in taking over the Bakun Dam project.
Once again, they stumble, they lose, we pay. And when they make?
Surely we should understand by now what "win-win" means: it means "I win, I win."
How to avoid this tariff increase? Simple: Make sure the BN is not returned to power. The Barisan Alternatif will see to it that if Tenaga wishes to make better profits, it will have to do so the difficult way – through an improvement in its efficiency and competitiveness, not through the easy way of gouging the poor consumer.
Making the most of a crisis, or the great bank robbery
MCA chief Ling Liong Sik used to repeat like a mantra that crisis, in Chinese, combined the characters for danger and opportunity.
Some of his cabinet colleagues, specifically a certain important minister, have taken the opportunity seriously – an opportunity to grab worthwhile assets and to re-organise asset holdings so as to further strengthen their hold and control of the domestic economy.
The latest and boldest of such moves is the plan for the merger of banks and financial institutions into six large groups.
At first glance, this seems to be a rational move. The country does have too many banks and financial institutions, many of them too small and inefficient.
However, a second thought shows that the move is completely irrational for the following reasons:
a.the time-table – mergers to be done by September this year – is totally absurd, b.the groupings are like rojak, c.the mergers at this time, instead of building efficiency will result in greater inefficiency, d.the forced mergers introduce an additional element of instability precisely at a time when the economy needs some calm and stability in the financial sector so that it can devote its attention to financing economic recovery; instead, they will now have to worry about their own mergers e.all talk of international competitiveness is nonsensical, for even after the mergers, the groups will still be much smaller than small provincial banks in Japan or the US or Europe
And this is not counting the fact that about 25,000 banking and financial sector workers will be redundant.
So why?
Making hay under the disguise of financial sector restructuring is why.
First, there is the move against what are said to be Anwar-related Chinese financial interests, starting with Multi-Purpose, followed by Allied Phileo and now Hong Leong. These also happen to be relatively healthy.
Then there is the move against bumiputera financial interests seen as not so reliable, that is, not unquestioningly loyal to certain VVIPs. In the so-called mergers, RHB under Rashid Hussain and Arab Malaysian under Azman Hashim will be swallowed up by more trustworthy interests. Rashid Hussain has sometimes been tarred with being a pro-Anwar person, although in fact, he’s just a businessman who kept friendly with all sides and in fact sometimes had the guts to actually say "No!" to some requests that went against his business sense and interests.
So this is not just a move against Chinese financial interests. Rather it is a move by certain VVIPs to consolidate their control over the financial sector.
And remember: in today’s economic order, whoever controls the financial sector, controls the economy, as Dr Mahathir himself has often reminded us in his frequent attacks on the global financial system.
Tomorrow: why the big hurry? Could it be to hold the country to ransom?
Yet another flip-flop – the height of irresponsibility
One of the major causes of our economic woes has been the many 180-degree turns in policy. Another cause has been a fixation on the stock market and the attempt to pump up the value of asset bubbles.
Wednesday, in the face of a major sell-down of shares, another such reversal and another attempt to pump up the stock market took place. The Governor of Bank Negara urged banks to increase their lendings for share purchases, and increased the proportion of total loans that could be given for such purposes.
Wasn’t it only last year when such loans were seen as a major source of our economic problems?
Further, the Governor’s arguments bore little relation to reality. The banks are awash in cash, but loans for productive purposes have not grown much simply because the opportunities for productive use of loans are not yet there.
Increasing the loans for share purchases now will only start creating another bubble, and be assured that when the bust comes, as it must, we will be in even worse shape than ever.
Remember, this increase in the limit on loans for share purchases comes hot on the heels of a lowering of the conditions for the issuance of credit cards, while previously there had been a lowering of the required repayment on credit card debt.
And they dare claim to be a responsible government?
visit The MALAYSIAN Website at: http://berita.webjump.com/
Thanks & kindest regards
Raja Petra Kamarudin
REFORMASI - The Right To Question http://members.xoom.com/rpetra/ http://www.parti-keadilan.org/