Helping real business grow

Many Malaysians are hoping the Government will take over the AES traffic camera system that was privatised to Beta Tegap and ATES.

The acting Transport Minister says more studies need to be done before a final decision is made but I think it's better for him to confine the scope of these studies to the cost of terminating the concession.

By persisting with a system where privatised entities take a share of the fines collected, the Government is inviting more headaches not just for motorists but for itself.

Sharing revenue that has been derived from fines and penalties with a private company disturbs the rakyat's good sense. Revenue-sharing has to be limited to business profits undertaken by a joint venture company where government interests are held.

To allow a private company to share in the fines collected is simply giving away government revenue. How can that be justified?

If indeed billions of ringgit can be collected under the camera system because Malaysians love to break traffic laws, then so be it-but let the Government benefit from this.

The administration must be willing to stop the practice of selling government assets and facilities to enrich businessmen who are close to the leaders.

This is the worst kind of privatisation, i.e. where no special skills or risks are involved, which means there was never any real reason to privatise in the first place.

Government projects should not go private for the sole purpose of helping out a handful of well-connected businessmen who can expect to see investment returns of 17% or more, which you won't get in the real business world.

Government projects should only be privatised, if at all, when the risks are high, the projects are complicated and the returns are within the range usually found acceptable by investors.

What the Government should be focusing on is helping real businessmen build our economy and country .We may have a growing economy but don't forget that we have a huge level of debt. Our ringgit is sliding, productivity is low and the flow of foreign investments into the country cannot match the outflow.

Even if we have the prime minister working hard and having a new slogan about "Endless Possibilities" to bring cheer and a positive outlook, there is no substitute to having an honest government that is free of corruption.

There is no substitute for good and transparent decision-making over the awarding of contracts. This is how we can bring back more investments, especially from the domestic private sectors.

Our Small and Medium Industries don't need chief ministers engaging in political lectures, but encouragement from state government leaders with suitable incentives.

I remember the days when the Ministry of Domestic Trade and Consumer Affairs held regular engagements and meetings with local businessmen and worked on ways to spur the setting up of small industries and factories.

These SMIs was the real engine of growth then. Then came a distraction. Many were caught up with the new mood of "Malaysia Boleh". We all set out to conquer the world.

Malaysians were told that the first man to circumnavigate the globe was a Malay and that they should emulate his feat. Malaysia Airlines flew to the corners of the globe even when passenger loads were frighteningly low. Local businessmen who did not even have a clue about running a business here invested heavily in foreign countries, not surprisingly without any success.

I hope when the advisers told the Prime Minister to replace "1Malaysia" with "Endless Possibilities" that they also told him to be realistic at all times. Malaysians must reach out to the world but we can't rush into it.

Let us take things within our capabilities so that we can cope with more difficult situations. Improving our skill sets and changing our habits and values to be more consistent with the demands of the modern world should be our priority.

Paying attention to the many unemployed youths by giving them business skills will reap better dividends.

There are many areas in Kelantan, Kedah and Perak that still need federal government intervention and incentives so that local businessmen can develop food-based industries and factories to spur the economy.

Our delivery system is way below competitive level, although Tun Abdullah Ahmad Badawi had tried to make this process one of the key initiatives of his administration.

Government agencies charged with supporting businessmen and farmers are not as efficient as their counterparts in Thailand and Taiwan, where agencies are better coordinated to support small and medium-sized businessmen.

What the country needs besides encouragement and the "can do" mentality is an equal heavy dose of reality, in whatever enterprise we undertake. The reality is that this country was built by and large by small businessmen.

Felda may go global and PETRONAS is a success story but let's not stretch our luck. Our years of economic success were grounded in the multitude of small businessmen around the country who worked hard and continue to be the backbone of our economic strength.

Don't think that just because our GLCs are responsible for the major industries and are home to all the best brains (not forgetting the interns in our Ministers' offices) that the answer to our economic performance and stability depends entirely on their success.

The simple truth that the likes of Margaret Thatcher, Ronald Reagan and Vladimir Putin learned was that governments do not do well managing businesses. It may work for a while, but not for the long term for then huge losses and big scandals seem to inevitably follow. - August 26, 2013.

* This is the personal opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insider.