Mahathirism: The single most important era in Malaysian developmental economics history

Mahathirism: The single most important era in Malaysian developmental economics history
Recently, Malaysian Insider, an online news based political portal reported a story on upcoming Prime Minister Dato’ Seri Mohd. Najib Tun Razak was bringing back the “Mahathirism” era, when he comes in at the helm by March 2009.
His running mate, Tan Sri Muhyiddin Mohd. Yassin was fast to respond when press ask him for an opinion on the matter. The Star has the story:

Sunday October 12, 2008 MYT 8:33:04 PM
‘No return of Mahathirism’
By HAMDAN RAJA ABDULLAH
MUAR: Umno vice-president Tan Sri Muhyiddin Yassin does not believe Mahathirism will return when Datuk Seri Najib Tun Razak becomes the Prime Minister next year.
He insisted that Najib had his own ideas, vision and strong political determination to lead the country towards a new era not only for the Malays but for all Malaysians.
“It will be improper for anyone to say the country and Umno would be under the control of former Prime Minister Tun Dr Mahathir Mohamad when Najib takes over the premiership,” said Muhyiddin, a contender for the deputy president’s post.
“I don’t think Najib would want it to happen as he has his own political programmes to re-strengthen Umno and regain the people’s confidence,” he told reporters Sunday after opening the Pagoh Umno division general assembly.
He was commenting on former de facto Law Minister Senator Datuk Zaid Ibrahim’s comment in the Sunday Star that Najib’s impending rise to the Umno presidency would mark the return of Mahathirism.
Jerlun MP Datuk Mukhriz Mahathir said Zaid’s comments only showed he was anti-Mahathir.
He said Zaid revealed his anti-Mahathir streak when he called on Cabinet ministers to seek forgiveness from the judges who had been sacked or suspended in the 1988 judicial crisis.
Mukhriz said Zaid had asked the Cabinet to do so even before he took his oath of office as minister.
He added that Zaid’s latest remarks truly showed his hatred for Dr Mahathir, who had lifted Malaysia’s image, dignity and prosperity to a level never achieved before.
Speaking to reporters Sunday before attending a Hari Raya gathering with Umno Youth members here, Mukhriz claimed that Zaid’s efforts to make the judicial appointments system more transparent and to allow the Bar Council to be involved in the appointment of judges would not play much of a role in the nation’s progress.
He asserted the reform issues raised by the former minister, if not implemented, would not cause the nation to crumble, adding that Malaysians had lived all this while without them.
“Zaid claimed he wanted to reform the system and to save Umno but I don’t see how all the issues he mentioned will benefit the Malays or Umno,” added Muhkriz who is vying for the Umno Youth presidency.
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Lets recap what “Mahathirism” was all about.
In 24 years of managing the economy post independence, where the mainstay then were primary products dependent and secondary low end manufacturing economy, Tun Dr. Mahathir had brought Malaysia to be the most promising new ‘tiger cub’ economy of East Asia, after South Korea, Taiwan and Singapore. The economic growth was promising enough that by 1990, the consistent annual expansion of 8% coupled with the vast economic and human capital resource available, meant Malaysia had potential to be developed nation status. Hence, in 1991, the ‘Vision 2020’ was launched and Malaysia was driven towards a developed economy within 30 years.
It was during this time infrastructure, especially logistics were developed immensely. This enabled the economic growth to be more robust. The single most important infrastructure project which is thought to the backbone of Malaysian economic growth is the ‘North South Expressway’, fully completed and operational by 1993. Of course one should not forget the development of ports like North Port and West Port in Klang, Kemaman Port and the latest, which managed to take on the “giant” in this region, the Port of Tanjung Pelepas. Then there is also the new KLIA, moved from Subang to Sepang. KLIA managed to somewhat gave a direct competition against Changi.
Malaysia managed to move upwards in the industrial sector. It became a preferred destination for investments in the electronics and ICT industry by the early 90s. Of course, the once primary based economy of this once a British colony took a bold move under Tun Dr. Mahathir’s stewardship and gambled on going into high technology. Proton rolled out its first car in 1985. Within less than 15 years of promising growth, Proton not only recovered the Federal Government initial investment by 20 times, also managed to developed their ‘Detroit like auto city’ in Tanjong Malim with purely internally generated funds.
The economy also went into diversification where more services sector was introduced, to support the growing physical economy. Capital and financial market related services grew exponentially during this economic boom era. Wall Street, European and Japanese firms were busy setting up offices and alliances with local firms. More so, during the ultra bullish period of the Malaysian capital market in early to late nineties.
Let us not forget Tun Dr. Mahathir’s strong vision of Malaysia to play the ‘catch up’ game of being a developed nation, with the launch and high octane drive on the Multimedia Super Corridor. A dedicated ICT city was developed, Cyberjaya, to make sure the industry has a home. Mastering the game is one single most strategic vision and policy Tun Dr. Mahathir had to place Malaysia well into the top echelon of then, a dynamic world with the globalisation challenges.The International Advisory Panel set up managed to get support from some of the world leaders in ICT.
Construction and property development sector is one of the most rapid and progressive within the economy, throughout Tun Dr. Mahathir’s time. Physical and tangible growth is promoted and it has a far reaching spiral and multiplication effect into the economy. So many new township, industrial areas and commercial centres grew in exponential proportions, especially the last 10 years of Tun Dr. Mahathir’s tenure due to the economic climate created by the Government policies and inducement programs. The spin off of this is that Malaysian corporations managed to place themselves as an international player, elsewhere.
The management of the nation’s most important mineral was in good hands, during the Mahathirism era. Petronas, which started as a joint venture partner with major players, brought themselves up along the learning curve and evolved into becoming the lead in markets elsewhere. The corporation emerged as the most profitable state owned oil company in the world and currently, exploring in 20 different countries. Petronas is now taking head on against once their own senior partners. Petronas also diversified into becoming a world class premium property developer and a formula one motor sport co-owner.
People development, (now commonly referred as ‘human capital’) saw termendous growth and new opportunity opened during these 22 over years. More public universities and new campuses built. This include the UIA. Sabah and Sarawak got their own universities, and eventually the rest of Malaysia. Corporate universities were added (which eventually became public universities), Petronas Technology University, Uniten, MMU and IKRAM. Then, it was the liberalisation of private universities and upgrade of colleges into university colleges, throughout the country.
Tun Dr. Mahathir as the Prime Minister had high respect for the civil service, the main engine for the Government. More structured system for the civil service were put in place, with better working conditions. Even a new purpose built administrative capital were built in Putrajaya. To many, it was a simply huge waste of money. To date, even the same critics and skeptics ten years ago find the city as the pride of the nation.
Private sector driven economic growth is encouraged and promoted during the Mahathirism. His privatisation policies, amidst strong criticism, helped to propel the nation much further and enabled its full potential. Government no longer involve with services, which was transferred into private sector hands. This gave the edge of lesser public capital expenditure (CAPEX) and reaped better returns, from taxes and dividends earned. The Government promoted the ‘Malaysian Incorporated’ (Malaysia Inc.) policy, where the public and private sector jointly rolled up their sleeves and achieved progress, especially in economic programs.
During Tun Dr. Mahathir’s tenure, the nation saw through two economic recession period; one in the mid eighties and the other after the Asian financial crisis (1997-98), from the deliberate attack by rogue currency traders.In both cases, the country’s economy was managed to be put on track and saw rapid recovery and growth. Especially in 1998, where Tun Dr. Mahathir enforced radical capital and currency control measures, which saw tough criticism from the global players. In no time, they have to eat their own words back and affirmed the ‘doctor’s’ prescription really worked.
In all, in 25 years (1980-2005), the Malaysian economy grew by almost a whopping figure of 500%. At his retirement, Tun Dr. Mahathir had placed the Malaysian economy and the system at its best.
Developmental economics, especially taken into the perspective as a world class player, cannot simply be taken without talking about international politics. Between 1981-2003, Malaysia has placed itself as a force to be reckoned with, within the international diplomacy. Tun Dr. Mahathir, is his attempt to detach and our over dependence and reliance on Britain as a former colonial master, adopted the “Buy British last policy”, which irked Margaret Thatcher, Britain’s most prolific leader (in the perspective of economy) end of the 20th century. In the same breadth, Malaysia went into the “Look East Policy”, which strategically benefited us immensely.
Then Malaysia promoted the expansion of ASEAN, to include nations which were non favourable to the West like Vietnam, Cambodia (then Kampuchea) and Laos. Of course, Malaysia pushed for Myanmar to be included. Malaysia, is a founding member of ASEAN Free Trade Area.
There were international armed conflict which Malaysia played pivotal role. Malaysia was the solitary voice against the bloody Balkan conflict, when Muslim Bosnians were slaughtered by their own neighbours and kin, in a genocide far worse than those of World War II in Europe. Malaysian armed units participated peace keeping missions in Bosnia, Iraq-Kuwait, Lebanon, Cambodia and the most memorable, Somalia where the Royal Malay Regiment earned their international accord for bravery.
Tun Dr. Mahathir as a world leader should not be mentioned without his role in promoting the South-South Cooperation. As a spin off, Langkawi International Dialogue was created and a mirror, South African International Dialogue. Much can be said about his vocal and unrestrained opposition against the white hegemony, back by the international jews. As such, first time in history, a leader of a nation was elected the Chairman of the Non Alignment Movement and Organisation of Islamic Countries, in the same time.
That earned many stars for the man and naturally, the nation. Superpower leaders such as Russian Vladimir Putin, French Jacques Chirac and Chancellor Gerhard Schrodder called on him here in Kuala Lumpur. He also had good relations with Jiang Zemin and Hu Jintao of China. Anti US leaders Cuban President Fidel Castro and Venezuelan President Huga Chavez showed termendous support, respect and admiration for the fourth Malaysian Prime Minister, who was seen as the champion of the third world nation.
Putting Malaysia on the world map is something Tun Dr. Mahathir carefully thought of and well implemented. Till present, the tallest twin office building in the planet is in Kuala Lumpur, on a site where it used to be a race course. It is an icon not only of the city, but the nation. In his dedication speech, “We need a box to stand, as tall as others. This twin tower is the box”. Somehow rather, that day, Malaysians have arrived as a group of people to be reckoned with.
In the final analysis, observe where the common Malaysians have been placed throughout the past 28 years. They say, “the proof of the pudding is in the eating”. The standard of living and income per capita says it all. The number of Malaysians, especially in previously under developed and deprived communities being allowed education all the way and ability to get jobs (which include MNCs - something previously unthinkable) contributed immensely on the household progression. The number of unit trust schemes introduced since 1981, also illustrated the progression. The number of private cars owned, even in far flung rural areas also shows it all. The socio-economic transformation of Malaysians, especially the majority is significant, despite the challenges it faced being in a very complex multi pluralistic society and external variables.
Of all these, promoted Malaysia into being the 17th most important trading nation in the world. By far, the Mahathirism era brought upon progress to all of us and this beloved tanahair. If Dato’ Seri Najib wants to bring back all of the progress brought along during the ‘Mahathirism’ era, so it shall be then.