Nazir Razak bastardising the New Economic Model

“I have strong opinions about how the NEP has been bastardised over the years”.

That was what NAZIR RAZAK said in August 2010 about the National Economic Policy.

Kenyang perut, suka hati..

He further said “it has come a long way from the social engineering experiment originally aimed at eradicating poverty, Nazir (left) said that the NEP has appeared to enrich small pockets of people.”

But here are just some of the list of projects that have been bastardised by Nazir Razak and his partners in crime in Khazanah Nasional and Air Asia:

1) The MAS – Air Asia share swap in August 2011 where CIMB was the adviser of the deal. Allegedly, millions of tax payers’ money were used when the deal was brokered by him but subsequently the share swap was terminated after barely 8 months after the deal was struck. Clearly, the whole collaboration was poorly advised by CIMB and yet they got to pocket and keep the ‘brokerage fee’  even after the said deal was proven to be one of the biggest blunder by him and Khazanah Nasional.

In order to save his reputation as a leading broker of deals in this hemisphere, he made a meek riposte on how the deal was not in vain after all. But the truth is, small pockets of people got to have a really fat pocket over a dodgy affair without any comprehensive thought process being deliberated. The aftermath of the share swap is for all to read. Of course, the continuing saga of MAS and Air Asia will beset interested Malaysians for a bit longer than anticipated. With the continued collaboration between Air Asia and MAS sans the share swap is still ongoing, one couldn’t help to wonder if we won’t see the last of Nazir Razak’s greedy palms in this joint venture.

2) The IPO listing of Integrated Healthcare Holding (IHH) of which CIMB is also the adviser for the deal. In this instances, Nazir Razak via CIMB advised Khazanah Nasional that any individual bumiputra who wants to take up the shares must have a net asset of RM3 million and cash of RM250,000. For a bumiputra company to take up the shares, it must have RM10 million worth of net assets.

What irked the blogosphere was the fact that such ridiculous conditions will only make the rich bumiputra richer while the less rich but enough cash to buy some shares will not be given that opportunity. Hence, small pockets of people will going to have a really fat pocket.

Syed Akbar Ali made a good point when he wrote :

The purpose of having a special bumiputra share allocation is to make sure bumiputeras (individuals as well as companies) who are on the lower rungs of the economic ladder will also have a chance to parrtake of the nations wealth.  Isn’t it a tad too ridiculous when  you set conditions like these (RM250,000 cash or RM3.0 million assets for bumi individuals, RM10.0 million assets for bumi companies)?  

Even Chinese and Indians may not be able to meet these types of money requirements. If bumis can meet these tough requirements, why have the ‘special bumiputera allocation’ at all?

In the mean time, due to his ‘brilliant’ business advice and manoeuvres in the past, he will still be paid by Khazanah (read: our money) for this 2nd rate advice.

3) Sime Darby – E&O deal in 2011 was also brokered by Nazir Razak and CIMB. The deal which was executed in the most highly inappropriate manner with irregular increase of share prices and conflicts of interests abound. The fiasco was investigated by Securities Commission but no concrete results and action were made and taken respectively. Needless to say, the broker will always get away with the least amount of risk but with the maximum returns he could garnered.

Basically it is better for Nazir Razak to look into the mirror and revisit the statement he made back in 2010 before lambasting a policy which benefitted mostly him.

To us, Nazir Razak is the leading L’enfant terrible in bastardising the NEP. With the advent of New Economic Model (NEM), he is surely positioning himself as the Father of Bastardising the NEM too.

Here is a parody of MAS – Air Asia deal which Nazir Razak took part in.

#malaysian-corporate-matters, #new-economic-model