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Its director Charles Santiago was picking up on revived public debate on the
New Economic Policy (NEP) following criticism by European Commission (EC) envoy
to Malaysia Thierry Rommel who described it as a deterrent to foreign investment.
<p>While it is high time the government corrects the flawed aspects of the NEP,
scrapping it in the context of FTA negotiations will not necessarily level the
playing field for non-bumiputeras, Santiago said when contacted.</p>
<p>“If markets are opened up to EU businesses – and the ones with an interest
in the FTA with Asean are huge corporations and conglomerates – it’s not
only Malay businesses that will suffer. We should realise that FTAs affect all
Malaysians (and so should act collectively).”</p>
<p>He said many local retailers were sidelined following the entry of foreign-owned
hypermarkets such as Tesco and Carrefour, and that the problem would multiply
under a EU-Asean FTA.</p>
<p>“Just as the Chinese small retailers lost out when the hypermarkets came
to dominate that sector, so too will other non-Malay companies lose out in the
long run,” he said.</p>
<p>Noting that Malaysians have been urging that the NEP be scrapped, Santiago
said this is all the more pressing in light of evidence the policy is being
abused by Umno leaders for political domination over the Malay electorate.</p>
<p>“Such problems with the NEP can be addressed by putting into place mechanisms
in government procurement, for example, to ensure accountability, transparency,
good governance are genuinely practised and competition is introduced,”
he said.</p>
<p><b>Rommel’s target</b></p>
<p>Notwithstanding Rommel’s comment on the impact of the NEP on public education,
the real target of his criticism is government procurement, argued Santiago.</p>
<p>But rather than open government procurement to all and sundry, this should
remain an instrument to advance socio-economic development and address imbalances,
he said.</p>
<p>The government’s decision to retain the NEP was among reasons for the
breakdown of the US-Malaysia FTA talks last April. The EC is therefore intent
on working through the matter before tackling the rest of the FTA, said Santiago.</p>
<p>Questioning assertions that the EU-Asean FTA will benefit both developing and
developed countries, Santiago said the EU-Mexico FTA of 2000 reveals the lopsided
results of an agreement between unequals.</p>
<p>According to him, promises that Mexico’s exports to the EU would increase
from US$4 billion in 2000 to US$30 billion in 2005 came up short when it was
found that the Central American country actually exported less to EU in the
first two years of the pact.</p>
<p>By 2005, Mexico had only US$10 billion in exports to EU, while its trade deficit
increased by 79.6 percent. The EU increased its exports to Mexico to US$27 billion.</p>
<p>“So when they speak of Malaysia being able to increase its exports to
EU, those promises mean nothing when placed next to the experiences of other
countries,” Santiago added.</p>
<p><i>Source: http://www.malaysiakini.com/news/69209</i>
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