“When NEP imposes 30% equity (or whatever other %) for the Malays and rules that management staff must be at least xx%, surely this infringes the freedom of choice of one’s business partners and the personnel who will determine the success or failure of an enterprise.”

I have not come across foreign investors who say that this guidance issued by MIDA, Bank Negara and the Ministry of Trade is counter productive. In fact at least those that I talked to welcome it agreeing with the host government that it is good for the long term political stability of this country. They have never tried to interfere nor take direct actions to circumvent the rule and guidance issued by these bodies. Their complaint is that they cannot find enough bumiputera partners i.e. companies and individuals with the necessary capital and experience.

Occasionally they do however grumbled or silently protested that they were being forced to deal with local banks and were being made to give a proportionate share of their foreign exchange business to local institutions without adequate record of exposure to foreign trade financing. Their connections with foreign banks are developed over many years and they do not need to offer landed collateral or local securities in many cases – just their parent company guarantee would be sufficient. Local banks usually require landed collateral in return for their long term facilities – term loans rather than letter of credit and bills discounting and other documentary credit, trust receipts and bank guarantees.

I agree however it is not the duty of any government to dictate the terms of how we go into business, who with and how we spend our money. Those are questions best left to the private sector.

Hornbill mentions the issue of laissez faire but we have left laissez faire en masse as long ago as the early 70s with the emergence of government bodies like FAMA, UDA and SEDCs. Since then more such bodies have proliferated the local scene.

And then there is the usual argument against laissez faire about which students of economics should be familiar with.

The effect of a policy that requires bumiputera equity participation in private businesses built up over generations by Chinese families is not fair. Steps were never taken to reduce the severity of the consequences of the implementation of such a policy. This is a valid criticism leveled against the policy.

“Even the simple task of not giving the 10% Bumi discount to those who own more than one medium-cost house is not discontinued.” H J Angus

This bumi discount should have been discontinued because it is being abused. You are creating a permanent underclass of non-Malay buyers of landed properties who deserve equal treatment.

Proton is not about bumiputra participation in the automobile industry. It is about government participation in an industry in which the private sector with its emphasis on profit is unwilling to enter.

““The way to stop discrimination on the basis of race is to stop discrimination on the basis of race.” Chief Justice John Roberts US Supreme Court. June 29, 2007.”

To show that we can never completely factor out race from our calculations in every day life, here it is!

The United States the beacon of the free world, after some 237 years is still struggling with racism despite their Constitution and all the laws.

Compared to the United States, Malaysia is a young fart arrogant enough to be telling the rest of the world that it is doing OK with her large minorities – that they are treated fairly and everybody is living happily ever after.

The truth is those who are living happily ever after are those who fly business class to destinations like Paris, London and New York, and live in huge mansions with more rooms then they care to count and more cars than they can drive and more mistresses than they have time to share with and more share than they have time for (huh?).