Opening the Perlis MCA convention last week, party president Datuk Seri Dr Chua Soi Lek told members to prepare for the next elections. He said it was “highly possible” that elections would be held next year to coincide with the launch of the 10th Malaysia Plan and the New Economic Model.

It is essentially a battle – with the next general election in mind – over the performance of the Pakatan Rakyat state government and its frosty relationship with the federal government.

Guan Eng wants the people, especially the Penangites, to show that he has been unfairly treated by a civil servant who shows little respect for him and yet has the backing of the federal government.

The Barisan Nasional, on the other hand, wants to impress upon the public that Guan Eng has not been able to rule the state smoothly and that with the DAP running the show, such regular political turbulence would not benefit the people.

Under the previous Gerakan-led state government, there were no such hiccups with Tan Sri Dr Koh Tsu Koon maintaining friendly ties with both the federal government and the civil service.

But it is not as easy as it seems. In Penang, Guan Eng is still strong even two years after sweeping into power.

Public opinion is with him on the issue. Generally, the sentiment is that Nik Ali has gone overboard by calling the CM biadap (disrespectful) and dayus (coward).

DAP supporters are questioning how a civil servant could show up at an Umno press conference, distribute prepared press statements to reporters and fire salvos at the CM.

The feeling is that Nik Ali has breached the General Orders and yet has the backing of the civil service and Cabinet, thus creating a dangerous precedent.

Nik Ali’s supporters, however, have countered that Guan Eng is to be blamed as he had been picking on Nik Ali for the past two years on the latter’s purported roles in three projects – the arches in Botanical Garden, the Penang Hill funicular train service and the alleged sand mining in Balik Pulau.

Nik Ali’s backers have also accused the CM of calling him incompetent, useless, unprofessional, a coward, and asked for his sacking.

The CM, they said, could have fired at the civil service or even the Barisan – as politicians often do – instead of aiming at an individual. This line of action, they said, was also unprecedented.

Understanding the pulse of Penangites well, Gerakan and the MCA have taken a much softer line. Both parties have asked Guan Eng to resolve the issue with Nik Ali rather than become involved in a verbal boxing ring and have it turn into a political controversy.

One soft point being played to the maximum is that at the launch of the Penang Hill funicular service, the CM was not even allocated a seat.

Umno has, however, produced a photograph of Guan Eng being seated at the function.

The two Chinese-based parties must have been astute enough to realise that whacking Guan Eng would not gain them political mileage. Penangites are known to be anti-establish­ment and they have kicked out three Chief Ministers in the country’s history.

Dr Koh, who is the Gerakan president, said the better way would be to handle federal civil servants professionally.

He said his pre­decessor Tun Dr Lim Chong Eu encountered similar problems when Gerakan was in the opposition – before joining the Barisan.

He said Dr Lim chose to tackle the issues at closed-door meetings or questioned the officers concerned in private or took up the matter with the federal agency concerned.

Penang MCA adviser Datuk Koay Kah Huah has asked Guan Eng and Nik Ali to get on with the job, pointing out that the squabbling would not benefit Penangites.

The Barisan leaders at the federal level, however, must have taken a broader view of the controversy. Umno leaders have taken advantage of the issue to press home the point that this is what happens if you have an opposition-led state.

The Cabinet backed Nik Ali, pointing out that the officer had been blamed for matters that were not even within his jurisdiction, and that Guan Eng had acted unfairly to score political points, knowing well that bashing a civil servant would be a popular move.

They probably also have in mind the huge votes coming from the civil service and that it made political sense to back Nik Ali.

There are a million civil servants in Malay­sia, one of the largest in the world.

The reality is that no government can function if civil servants, whether at state or federal level, do not cooperate with political leaders.

Selangor Mentri Besar Tan Sri Khalid Ibrahim was more sensible, going around to meet the state’s top civil servants personally to ensure he does not run into a storm which he may not win.

As civil servants, they may be expected to be civil and servants to the nation but they can certainly wreak havoc in the running of their administration. After all, political leaders come and go but the civil servants remain.

Guan Eng must have surely watched the popular ‘80s British satirical political sitcom Yes Minister to appreciate how civil servant Sir Humphrey Appleby – who was actually holding the powers – manipulated Administra­tive Minister James Hacker. If he hasn’t, he had better do so now.

But in the end, Guan Eng may have gained enough political sympathies from Penangites but Nik Ali, as he has been told, would still remain in Penang.

The two can either swallow their egos, sit down and thrash things out or have a go at each other again in another round. Let’s face it: it will be a stalemate as they are stuck with each other.

Muyhiddin is right in stating that the consensus among Malaysian parents is that our students are overloaded with examinations.

The schoolbags have been getting heavier. The media have already reported on how these bags could damage the backs of our students but nothing much has really changed.

Most parents would agree that the fun has been taken out of schooling.

Students have little time for anything after school except tuition classes while sports is hardly on the priority list.

Yet, there seems to be some apprehension over the proposal to do away with the two exams.

Really, a Year Six student should not be facing exam pressure at that age. In most countries, and especially those in Europe, taking exams at an early age is unheard of.

This uncertainty among parents could be due to the fact that they have seen so much backtracking – a more polite word for flip-flop decisions – in the past.

Every new Education Minister seems to be eager to leave their mark behind and even if their decisions come with the best of intentions, they could be disruptive to our students if they are changed every few years.

We have tried teaching Mathematics and Science in English. Every politician seems to have commended the move when it was implemented but these same politicians would find more reasons to argue against it later.

It makes Malaysians wonder why these politicians did not have the hindsight of all these arguments before the decision was made.

So, the students are now back to square one – learning these two subjects in their mother tongues.

When Datuk Seri Anwar Ibrahim was Education Minister, he imposed the tongue-twisting Bahasa Baku. Every newscaster seemed eager to please Anwar then with the best and correct pronunciation, even if an hour after the news bulletin, P. Ramlee was speaking a different kind of Bahasa in a movie.

Muhyiddin could be right. Without these exams, the media could stop highlighting the top scorers. Over the years, the media have in fact started to feel that we should not be promoting such an exam-oriented culture.

So many Malaysian students seem to be able to score so many distinctions that many are asking whether their strings of As accurately reflect their capabilities.

Many employers who have interviewed these scorers have the right to be sceptical because for many a distinction in English for the Sijil Persekolahan Menengah (SPM), for example, is really a D in the days of the Malaysia Certificate of Education (MCE) of the 70s.

Put simply, our standards have plunged. We have compromised on our grading. Many school leavers and graduates are unable to speak and write proper English but they believe they are proficient because they have passed the exams.

Worse, there is a false sense of confidence and hope among our students, thus the demand for places in universities.

Many students seeking to enter international schools in Malaysia and boarding schools overseas have found themselves failing the entrance examinations. This has come as a rude jolt because many of them are from well-to-do families and speak English at home.

The entry point into a prestigious British university such as Oxford, the London School of Economics or the University College of London is only a maximum three distinctions. They do not need a Malaysian with 14As but the rules are rigid and the standards high.

There is also a serious lack of analytical and communications skills among our students but that is also partly because our teachers, the product of our education system, have failed miserably in these areas.

Many students are ill-prepared for working life, unable to write a proper e-mail to apply for a job or to express oneself at interviews. Many employers in the private sector have long expressed their frustrations and alarm at this state of affairs.

Muhyiddin is aware of these problems. It would appear that he wants to end the examination culture, the long teaching hours, the endless tuition classes and homework.

The education system seriously needs fixing. This could be a first step but he needs to clearly comb out the problems, point out the priorities and tackle them one by one because there is so much that is wrong with the system.

Malaysians want him to succeed, to get it right, so that there will be no need to shift gear midway. It is all right to seek more views before implementing them because our students should not be guinea pigs for any decision.

Two years after the 2008 general election, the Pakatan state governments, arguably, have not lost their popularity and voters in these two states are prepared to overlook their occasional slip-ups, seeing them as part of the learning curve.

After all, the Barisan already had their opportunities for the past five decades, so why should the inexperience of these two new state governments not be forgiven?

With one foot in the state government and another foot hoping to land in Putrajaya, there is strong confidence within the Pakatan that they can push even harder in the next election, with many believing that the administrative capital is within their reach.

But the PKR, as the main component in the Pakatan, is also like any political party. Politi­cians may like to project themselves as saviours to the people, and some may even start believing in their own propaganda, but it is also about power and positions.

Khalid, a former corporate figure, has a likeable personality and the business and political establishments have found it easy dealing with him. He is, after all, a product of the country’s establishment.

In fact, in the 2007 Ijok by-election, which he contested and lost, the PKR treasurer-general stunned his listeners when he urged them to vote for the Barisan at the end of his speech, surely the result of his long association with the Barisan. Old habits, as they say, die hard.

In the 2008 political tsunami, Khalid won a parliamentary and state seat, and he went on to become a Mentri Besar.

It was a position, many believed, that Azmin Ali, the long-time confidante of Datuk Seri Anwar Ibrahim, had long eyed.

Like Khalid, Azmin also has a federal and state seat but the difference is that Azmin is a political animal who sees himself as having gone through a baptism of fire with all the trials and tribulations of an opposition man. Khalid would forever be seen to have an easier path, and worse, parachuted to a prized job.

Every approach made by Khalid since 2008 has been scrutinised, criticised and leaked to the media, including the ill-fated negotiation with PAS leader Datuk Dr Hassan Ali as Deputy Mentri Besar despite having a comfortable majority.

One of the news portals, Malaysia Insider, has attributed the mutiny in PKR, said to involve 16 Members of Parliament, to the lack of largesse – in simple English, it means lack of generosity over rewards and, in the political context, it refers to positions, contracts and titles.

Politicians, whether in the Pakatan and the Barisan, expect, even demand, these so-called loot of victories. More so among the early PKR members who feel that they have fought hard for it and insist that they should be recognised.

They are alarmed that former Barisan leaders, having failed in their own party polls, are now given the platform and accorded titles in the party. They want to know, and rightly so, where these people were in their early years of formation, when they were being beaten up by the police.

Then there are the PKR grassroots leaders, many formerly from Umno, who have not lost their political dealing skills, in a party where there are now growing economic opportunities.

It has not helped Khalid in steering the ship when many of his backers in the state government are former non-governmental organisation leaders.

They have the idealism but they are unlikely to be able to match the manipulative skills of seasoned politicians.

The media has long maintained that state executive councillor Elizabeth Wong, who was involved in a sex picture scandal, was a victim of PKR in-fighting. While it was easy to blame the Barisan, it certainly did not benefit the Barisan and certainly it would not be easy tracking the culprits as one does not need a forensic expert to figure out the possible conspirators.

On Friday night, Khalid reportedly called for an emergency meeting of state PKR leaders at his residence ahead of the leadership retreat this weekend.

The press has reported that the faction aligned to Azmin wants to move a petition to remove Khalid as the Selangor PKR chief.

There’s no smoke without fire. Azmin certainly would not want to see the house burnt down. A side meeting involving the key personalities would probably be brokered by Anwar to strike a deal.

A show of unity would be put up, the mutiny would be dismissed as a figment of imagination by the press, Azmin would remain silent and if the loot is still not well distribu­ted, or honoured, the next revolt would have to be staged. That’s realpolitik.

The first quarter result of the economy is good and Datuk Seri Najib Tun Razak’s momentum must be supported and continued, even if it seems radical.

If tough measures have to be taken, then we have to bite the bullet together.

Under construction: The new Istana Negara in Jalan Duta is being built at an estimated cost of RM812mil.

Since 1998, Malaysia has been operating on a deficit budget with the national debt increasing at 12% annually.

Even when the prices of petroleum and palm oil rocketed in 2003, we still ran a deficit budget, lacking the political will to put things right.

To do this, the Government has to cut subsidies, which amount to RM74bil annually and include subsidies for sugar and petrol.

Seriously, why should Malaysian taxpayers pay for your love of sugar, which is bad for your health, or the petrol for your three cars?

But many middle-class Malaysians, many of whom find themselves with little left to save after the monthly income tax and EPF deductions, also want the burden to be shared.

It must be a shared responsibility. It’s frightening that only over one million people pay income tax and they have to shoulder the huge responsibility.

Despite the reservations and objections, the Goods and Services Tax (GST) has to come into place for the net to be wider.

But if we wish to continue convincing Malaysians of the need to slash subsidies, they cannot be hearing about plans to spend RM800mil for the construction of a new Parliament building in Putrajaya or RM812mil for a new palace.

They cannot be blamed if they compare Malaysia with England where Westminster and Buckingham Palace, which are much older, are still being used.

It’s a relief to hear the Prime Minister saying that the proposed Parliament building is merely at a discussion level and it would depend on the availability of public funds.

No one, regardless of our positions, should be spared from keeping the country’s kitty tight.

If we are struggling to pay our bills, stop acting like a rich man, for God’s sake.

Buildings are supposed to be functional and not for cosmetic purposes.

Whether it’s the Parliament or state legislative buildings, the elected representatives only meet a few times a year, so it is unforgivable to spend huge sums for such buildings.

Our politicians can try to convince us that these are iconic structures but Malaysians are not in the mood to buy these stories.

There is also a need to look at purportedly private projects which are in reality subsidised by the public, especially independent power producers, toll concessionaires and water companies.

Jala has said that indirect subsidies amounting to RM56bil have been dished out.

Malaysians also need to be assured that the withdrawal of subsidies would be gradual.

In fact, it’s only a reported RM2.6bil to RM15.7bil by 2015.

Giving rebates for electricity bills, or even not charging those using below 100KW, is being considered, for example.

But while we consider reducing our subsidies, we also need to urgently step up our competitiveness in the region because foreign direct investments (FDIs) have been lacklustre while major local companies are investing abroad, where they believe that there are better growth opportunities.

Some have chosen to list their companies in Singapore and Hong Kong. Regionally, Vietnam and Indonesia have become attractive, especially the latter where investors now find the atmosphere less stifling.

We need to kickstart ourselves.

The New Economic Model should push through these programmes if we are serious.

The impression is that there are politicians who still want to keep the old ways even if they retard growth, and are seemingly prepared for short term gains at the expense of the country’s future.

We are slacking and underperforming. There is no point talking about ethnic equity distribution if the cake isn’t growing.

Yes, we have to endure the subsidy cuts because there’s no option anymore. The Government has to do it but it needs to also cut down on the excesses and waste as a result of incompetence or corruption.

On The Beat by WONG CHUN WAI

IT’S pretty straightforward. In any public listed company, it is the board of directors that leads and controls the company but the series of news relating to Sime Darby and Kenmark have put corporate governance in Malaysia in bad light.

It is not just the chief executive officer who must take responsibility but also the executive and non-executive directors for all decisions taken.

In short, all directors have the same fiduciary responsibilities as they are regarded as stewards of the organisation by the shareholders. The shareholders and employees expect them to understand the business operations and bear responsibility for their decisions.

In the case of furniture maker Kenmark Industrial Co, Taiwanese managing director (MD) James Hwang Ding Kuo and executive director (ED) Chang Chin Chuang have disappeared.

For the last five years, the company’s receivables – delivery of goods where payments are still pending – have been increasing with revenue decreasing.

In its quarterly report for 3Q 2010, receivables shot up to RM248.7mil even as revenue continued to drop with its cash balance as at Dec 31 standing at only RM2.2mil while debts totalled RM141.4mil.

It’s really a horror story. The point is this – why didn’t the directors ask what was wrong?

While the MD and ED have packed off, certainly the entire board must take responsibility for the disgraceful event in Kenmark.

Hwang has reportedly said he has been sick and unconscious in the past weeks and recuperating in China. But the company, which has been taken over by new shareholders, needs urgent handling.

In the case of Sime Darby, the overruns of its Bakun project has chalked up to RM1.8bil. It’s more than just a fiasco.

Tun Dr Mahathir Mohamad, who has asked for shared responsibility, has revealed that the Government has made a RM700mil compensation to Sime Darby. We are talking of public money because the Government’s coffers come from taxpayers’ money.

He is right. The departure of chief executive officer Datuk Seri Ahmad Zubir Murshid isn’t enough. The whole board cannot continue to enjoy their directors’ fees and perks while refusing to take responsibility for the massive losses.

After all, the project has been delayed for three years and surely the board should see the cost overruns.

The directors cannot say that they were not aware of the project, the risk factor and the losses. And if they were aware, did they raise the red flag and put on record their reservations as required under the law?

Sime Darby chairman Tun Musa Hitam has said that he would leave it to the shareholders to decide whether the board should resign.

In fact, if the directors have any dignity and any sense of accountability, they should not offer themselves for re-election. There should be no sacred cows; if they have to go, they have to go.

In fact, the shareholders and even the public deserve to see a detailed and full disclosure of Sime’s losses in its energy and utilities divisions.

No project is guaranteed of profits and many profit-making companies have divisions that are still trying to make money but the board is required to conduct regular performance review and query the company’s project management panel.

The core business of Sime Darby is plantation – its problem started when it began to do business in areas it has no business to be involved in.

It is the board’s responsibility to study the risks involved in any venture outside the company’s core business and they must take responsibility for their decisions.

The public buy Sime Darby shares for its plantation concerns and certainly not for its utilities and energy ventures, or rather adventures.

Transparency is obviously missing in the case of Sime Darby and Kenmark. They have given Malaysia a bad name.

The directors of these two companies should just quit if they believe in good corporate governance and accountability.

If the rest of the world expects remorse and regret, they would have waited in vain; this is not the first time and probably not the last for such a display of arrogance on the part of Israel.

This is a country which clearly considers itself above international laws.

It is untouchable and no one can blame Israel for being smug when it has been let off with a pathetic watered down statement from the UN Security Council.

Thanks in part to Big Brother, the United States, which has made sure that the condemnation is not overly harsh.

There’s not even a squeak from President Barack Obama, who has conveniently made himself busy with the Louisiana oil spill.

As in previous violations of human rights or to be more precise, the simplest form of human decency, the Israelis see such a slap on the wrist as an encouragement to continue to disregard world opinion.

Earlier this year, a team of suspected Mossad agents murdered a political opponent in a hotel room in Dubai with all the agents using forged passports from other countries.

If it is prepared to kill a foreign opponent in foreign land, what is killing nine activists, quickly branded as violent anti-Israeli campaigners, in international waters.

During Christmas in 2008, Israeli staged a three-week assault on the Gaza Strip, killing over 1,400 people, of which a third of them were children.

The Gaza Strip is only 40.2km long and home to 1.5 million people, mainly Palestinians.

In 2006, the Israelis attacked Lebanon for over four weeks, killing over 1,000 people.

After the usual global condemnation, the world will move on.

It would be swiftly forgotten, including the attack on the flotilla, and the same action would take place again, possibly more killings. US officials would dust off their documents and issue the same sounding hypocritical condemnation of such aggression and persuade other countries to be soft to their Israeli ally.

It has been able to get away with it because the Arab countries, which circled Israel, are disunited and to be more blunt, corrupt and impotent.

For example, Egypt is a partner of the blockade which the aid activists were trying to break into with the flotilla.

Saudi Arabia is a strong ally of the United States, which has reciprocated with total silence on the state of affairs in this oil rich country despite its horrible record on human rights and non-existent democracy.

Kuwait gladly offers itself as a base for the American army while Iraq is essentially under US control.

So, despite the Arab rhetoric, the Israelis know they have powerful friends in Washington, DC who will back them in their justification – that they need to protect themselves against the sea of enemies.

What aids their cause is that Hamas and Hezbollah, which regularly send rockets to Israel, have terrorist affiliations and even the Arabs would admit that there are nutty Palestinians who target Israeli civilians.

These two groups are certainly no angels, let’s not kid ourselves. They are not Boy Scouts and are known to take civilians as hostages.

But the latest incident could cause the Israelis to lose some tolerant friends in the Muslim world. Turkey has diplomatic relations with Israel. As a secular nation, it is Israel’s longest standing and most strategically important Muslim friend.

Unfortunately, the ship which Israel attacked in international waters was flying the Turkey flag and nine of the victims were Turks, understandably sparking off a wave of protest in Istanbul and leading to Turkey recalling its ambassador from Israel.

In short, Israel treats its only friends with contempt. It doesn’t give two hoots what the world or its friends think of them.

Malaysia has no ties with Israel but allows Christian groups to travel to Jerusalem for organised pilgrimage with approval from the Immigration Department.

Six years ago, I travelled to Israel via Jordan where I had a first-hand look at how the Palestinians were treated by the Israelis.

Even the Malaysian group I was in was mocked at the check-point by the young army and immigration officers, making us wait until the check-point was about to close before letting us in.

As we prayed, they laughed at us. It was a reminder to us that Jews are not Christians and one should take a broader look that they are so-called God’s chosen people.

As I continued my journey, I saw how a father with a child was made to wait for hours by the roadside while the soldiers checked his identity. I found out this is how Palestinians, who travelled into Israel, were treated daily.

My guide, an Arab Christian, who spoke excellent Bahasa Indonesia, had nothing but contempt for the Israelis. His sentiment was shared by many young secular Israelis I met.

The moral of the story is this – this is not a Muslims versus Jews story. There are also Arab Christians and secular Jews who want an end to the hawkish Zionist way. Also, most Israelis are not Christians and unlikely to feel for the Christian cause.

There are only good and bad people. There can be no excuse for heavily armed commandos to kill the campaigners, even if their plans were to grab world attention rather than aid and peace. Now, that’s really bad.

The last is the most difficult for Najib as Barisan president to handle without being seen to be interfering in the affairs of component parties.

These are leaders who see themselves as indispensable and believe that their parties would crumble without their presence. They forget that we are all mere mortals and that life would still go on tomorrow with or without them.

So, again, we have heard Barisan leaders saying they would carry out post-mortems to find out why they were defeated in the Sibu by-election. Really, many ordinary Malaysians would be able to give the reasons without having lengthy meetings.

Some politicians seemed to be able to give an intelligent explanation on why Barisan lost immediately after the results were out, but we should ask them why they did not share those insights earlier.

Missing the pulse

The worn-out political strategy of announcing financial grants no longer work in urban constituencies because voters see this as a duty of the government.

As taxpayers, they expect the government to make these allocations regularly during the five-year term and not just on the eve of an election.

Politicians should not expect voters to be grateful when this money is given. Why should they be grateful when it’s the people’s money? Where does government money come from? It certainly didn’t drop from the sky.

Helping elderly or rural people with no identity cards after they have lived in Malay­sia for decades or, worse, were born here, is good but it is also a double-edged sword because it is reflective of the government’s inefficiency.

As senior MCA leader Datuk Seri Dr Fong Chan Onn said last week, some Malaysians have demanded to know why it seems to be easier for many Indonesians to get their documents to stay here while there are Malaysians who face numerous problems to get theirs.

If we look at the March 8 results, it looks like many of our political leaders missed the pulse of the urban electorate and increasingly the rural voters. They do not want their elected representatives to be merely “hardworking and can bring development” to their constituencies. Looking at potholes and clogged drains will not win elections now, it’s as simple as that.

Barisan leaders continued to use this approach in Sibu even when voters talked about integrity, credibility, accountability and justice.

They want to hear the leaders talk about stopping corruption, discriminatory policies and the racial divide. They want to hear more about 1Malaysia and how the government plans to see it work beyond slogan shouting.

Such political language should not be the monopoly of the opposition. Barisan leaders should also be talking this talk.

These voices have become increasingly loud and as political leaders, they must have heard and surely want to respond to these alienated voices.

With a general election in about two years’ time, Barisan politicians including those in Sabah and Sarawak had better get out of bed quickly. They cannot remain in snooze mode for much longer.

Harsh truths

They cannot take for granted that the postal votes would go to the Barisan. As evident since the March 8 polls, soldiers and policemen have voted for the opposition, as have orang asli voters whose constituencies have now become semi-urban or even urban, as in the Bukit Lanjan state constituency in Selangor, which is located near two shopping complexes.

But the point is this: it is not enough for Barisan politicians to know the reasons and not address them. Post-mortems by political parties often focus on how they lose in elections rather than why.

In the latest edition of the Economist magazine, it was reported about the defeated Labour party in the United Kingdom that “they have concentrated on Labour’s failure to convey its message rather than on its substantive mistakes” and “they have described the defeat rather than properly accounting for it”.

Labour, it said, “needs someone with the gumption to take the ritual post-election hypocrisy beyond platitudes and into harsh truths”.

The story seems the same. The defeated politicians have blamed everyone, from “ungrateful” voters to the media to “barbaric outsiders”, except themselves. Finding scapegoats and sacrificial lambs is an easier way out than to face harsh political realities.

Politicians can choose to ignore the changing political landscape at their own peril because ultimately, it would be the people who would decide. By then, it could be a political wake if these politicians do not wake up.

Many Malaysians have been buying the euro, pound and dollar when it began to decline against our ringgit.

For parents, it means it has become a little cheaper to pay for education and certainly to travel to Europe and the United States.

For businessmen, the cost of imports has reduced and would surely make the balance sheet look better at the end of the financial year.

The ringgit has also performed very well against the Australian dollar, which must surely be welcomed by many of us.

Year to year, the ringgit has appreciated by about 6% against the US dollar, 19% against the euro and 16% compared with the pound.

It may still be early days as we have just finished the first quarter of the year, but the 10.1% economic growth has certainly been impressive. Not only are we out of the woods but the figure is the highest quarterly growth in a decade.

Rosy outlook

There are simple reasons for these figures – exports are up, external factors are improving, there is low inflation, foreign money is coming in again and there is rising interest rates.

It is important to note that many Malaysian companies have reported a strong performance for the first quarter.

Public consumption has risen to 6.3% from 0.7%, reflecting public confidence and certainly job security, thus the willingness to spend, which helps to generate the economy.

The 10.1% first quarter result has prompted analysts to relook the earlier forecast of 5.5% GDP growth rate – now they are talking of 6.6% and even 7.0% to 7.5%.

There was also another piece of good news – Malaysia has taken the 10th spot on the Switzerland-based IMD's World Competitiveness Yearbook for 2010, a result that will make it more attractive to foreign investors. We are up from 18th placing last year, which is certainly a big jump. The list measures Malaysia against 58 countries this year, from 57 nations last year.

With an index score of 87,228, Malaysia has joined the ranks of the most competitive countries in the world ranking with Singapore, Hong Kong, the United States, Australia, Switzerland, Sweden, Canada, Taiwan and Norway.

Malaysia also made big leaps in government and business efficiency. It was ranked ninth, against 19th last year, for government efficiency and fourth for business efficiency compared with 13th previously.

The economic performance and the infrastructure factors improved to eighth, against ninth last year, and 25th, from 26th position respectively.

The question now is whether Malaysia can sustain the momentum for the rest of the year. The second quarter could be less robust, given the impact of the slowing down of fiscal stimulus spending while there could be external factors beyond our control.

While we deserve a pat on the shoulder, it is still too early for celebrations as there are a few factors that we need to recognise.

No room for complacency

Foreign direct investments continue to be a concern, our stock market is still lacklustre and private investments have still not recovered.

Our neighbours – Indonesia and Vietnam – have become attractive because of their cheap labour, large market and lower cost of doing businesses. Singapore continues to attract a steady stream of professionals and skilled workers.

Malaysia is still struggling, unable to pull in the best talent with some groups still insisting on clinging to their protectionist attitude and not realising that we will be left behind in a strongly competitive world.

The world has changed and all the talk about race supremacy is inconsequential if we are nobodies on the world stage.

We have to break out of this mode and create an identity for Malaysia as a place for the best brain and talent if we are to become a high-income nation.

The “Malaysia Boleh” slogan has instilled a sense of hope and confidence but some of us have also become unrealistic, even arrogant, thinking that we are among the best when we have lagged behind in the region.

The global market place does not tolerate mediocrity and flip-flop decisions. We need to change fast and certainly there is much hope on the New Economic Model (NEM), which was unveiled in March, with more details being released.

The first quarter 10.1% figure should also not be a reason for anyone to believe that all is fine and that the old ways are working.

The Prime Minister has to tear down the old structures, put up new frameworks and push for the changes under the NEM. Well done and keep up the momentum, sir!