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Musa Aman’s financial management of Sabah is solid

November 28, 2017

Opposition politicians should not simply criticise or blow hot air but should come up with workable and concrete plans to show that they can do better than Musa in ensuring continued economic growth.

COMMENT

musa-aman-sabah-economyBy John Lo

I attended the winding up of the 2018 budget session at the Sabah State Legislative Assembly to see the performance of the Yang Berhormats in the opposition. A few of them spoke negatively about Musa Aman’s 2018 budget and disparaged the surplus he has managed to accumulate since taking over as chief minister in 2003. While it is their right to criticise the 2018 budget, I like to deal with two matters.

First, it is disappointing that the opposition has not given Sabahans a viable alternative budget or some bright ideas that can improve the budget. Criticism in politics, and for the sake of politics, do not have meaning if there is no constructive suggestion or alternative. To think, to produce useful ideas, especially on Sabah’s financial matters, for the benefit of the people is a lot tougher. But not impossible if there is commitment.

Secondly, I cannot agree with the opposition YBs for refusing to recognise and appreciate that Sabah has been benefitting from pro-growth budgets and at the same time, has managed to accumulate a surplus of more than RM4 billion under Musa. I am concerned with the way the YBs in the opposition have presented their points in the assembly: it either shows a lack of responsible or coherent financial attitude or that they are not conversant with financial responsibilities at the state level. I just hope this is not true, for if it is true, Sabah will be in financial trouble if ever they were to take over. This is most worrying. Sabah cannot afford to travel back in the path of financial miseries like that in the mid-1980s and before Musa took over as chief minister. It took a whole generation to climb the “long tough uphill road” back to financial respectability. The present young and future generations should never be made to endure and tolerate this economic hardship again.

I have written this before and will now repeat it:. Sabah has had 15 chief ministers but only Harris Salleh and Musa have grown the economy and built up reserves for Sabah. Why have only these two chief ministers done it? Those leaders having Sabahans’ financial concerns in their hearts should do some introspection on this matter. For Sabahans to continue our current economic progress, these leaders should come up with profound comments on the financial management at the state level.

There is a whole new Y generation of Sabahans who are better educated, have access to the internet and are knowledgeable about money and opportunities. These young Sabahans know what good leaders should do. I am quite certain that they will want a leader who is like a good responsible family man who will provide his loved ones with a conducive financial environment, earn enough money for them to enjoy a decent standard of living, and save some for a rainy day [budget surplus]. Also, they’d want someone who can accrue a tidy sum in case a good opportunity arises to invest and expand the family’s financial asset [state reserves].

Such a good man will think about his next generation.

Contrary to this is a bad family man. He could not care less about his wife and children. With this negative attitude, he is selfish, likely to avoid hard work, does not plan, and does not care what will become of his children. He will tell his children to look for their own money if they want to go to university. He will spend most of his money on himself. Most probably, he has some bad habits like drinking, gambling and, most certainly, very poor management of the family finances. Such a man thinks the world starts and ends with him. To him, the future generations can fend for themselves.

Sabah must retain our present financial stability and respectability, not for their sake, but for long-term steady economic growth. To destroy the economy is easy. To struggle back to economic health can be long and arduous. Both China and Singapore took more than 30 years to do it with first class leaders. Many never regain it. Countries with financial surpluses and reserves are able to enjoy this long-term economic growth.

I will now give the top four countries with the largest reserves in the world to illustrate this point. China has the largest reserve, followed by Japan, the Euro Area, and Switzerland. It is no accident that countries having the largest sovereign funds are also enjoying the same. Norway has the largest, followed by Abu Dhabi, China, Kuwait, Saudi Arabia. We all have heard about these countries and not surprisingly, look up to them with some envy.

At the other end of the spectrum, the countries with the smallest reserves are Sao Tome and Principe, Federated States of Micronesia, Dominica, and Samoa. You have not heard of them? Not surprising. These are very poor countries.

I have used some positive attributes of a good decent family man to illustrate what a good leader for Sabah should possess. The reason is this: Sabah has emerged from prolonged economic doldrums since the mid-1980s, having suffered from chronic perennial deficits which many chief ministers/finance ministers could not solve. Economic pessimism and a sense of hopelessness had enveloped the whole state. From being the No. 2 State in Malaysia during Harris’ time, Sabah sank to the bottom. Sabah was then known to be the poorest state in Malaysia. Imagine what it was like to live with this stigma. Economic hardship was very real. It was terrible for Sabahans when our state had no money and was dependent on handouts from the federal government to bail us out all the time. Wherever  we went in Peninsular Malaysia, my generation was reminded that our state was being badly managed and that our leaders had squandered our assets away. Thank God that the current generation does not have to face the indignity of our generation. Sabah’s future generations should and must never suffer this humiliation again.

What sets aside those countries with high reserves or surplus? What makes countries with great natural resources such as oil perform badly? Why has Norway been able to build up the largest sovereign wealth in the world from oil? The common denominator to national wealth management and wealth creation is good quality economic leadership with integrity. The same applies to Sabah.

Why is it important for Sabah to have surplus budgets and good reserves? Historically, most of our chief ministers have little appreciation for financial management, or prudence. Hence Sabah has experienced many “on/off” financial track records. This is one of the main reasons for Sabah falling behind in economic development before. It is impossible to nurture the economy if there is no consistency of good financial management by the state government.

For meaningful economic development to take root, Sabah [just as other states or countries], must build up a well managed financial position over a number of years. This will give time for solid economic fundamentals to be established. To keep this economic growth on track, the state reserves will act as the stabiliser to smoothen any economic “down-sides”.

Steady economic growth and prudent financial management are inseparable twins. Musa has managed to produce these two factors for some years now. With these factors in place, investors and business people can plan their expansion and/or investment of their businesses with certainty and confidence.

Musa’s efforts to revamp and innovate Sabah’s economic development model/system has been very little heralded and grossly underappreciated. Without these extensive improvements, in the economic model/system, the achievements thus far would not have been possible. The old model/system had failed. No opposition leader has ever mentioned how he/she can improve on Musa’s economic development model/system. To continue our progress, the present model/system must serve as the fundamental structure on which to build our future.

My point in all the above is simply this: Aspiring leaders should not simply project themselves as if they know better or can do better. It’s more than just “simple politics”. It will impact, favourably or adversely, on our lives and future generations. They should really give some serious thought to the undermentioned points before shooting with their comments. [a] Offer convincing proof to Sabahans that they can do better than Musa. How much better? Which part of our economy will be better? [b] Show what they can do in economic development. [c] Show they have sufficient experience and knowledge in managing Sabah’s financial position. Do they know how fast the reserves by Harris had been spent? [d] What can they improve on our current economic development model/system that Musa has built up? [e] What are their budgetary policies? [f] Will they want to, and how can they, add on to the reserves of Musa?Any leader who thinks he/she can look after the economic and financial interest of Sabah must come up with a vision, and implement the plans based on facts, figures and targets. Anything less than these minimal details is just hot air.

John Lo is an FMT reader.

The views expressed are those of the author and do not necessarily reflect those of FMT.


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