The Price of Malaysia's Racism and Apartheid

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".....Once one of the developing world's stars, Malaysia's economy has underperformed for the past decade.

Almost 500,000 Malaysians left the country between 2007 and 2009, more than doubling the number of Malaysian professionals who live overseas. It appears that most were skilled ethnic Chinese and Indian Malaysians, tired of being treated as second-class citizens in their own country and denied the opportunity to compete on a level playing field, whether in education, business, or government.

Many of these emigrants, as well as the many Malaysian students who study overseas and never return (again, most of whom are ethnic Chinese and Indian), have the business, engineering, and scientific skills that Malaysia needs for its future. They also have the cultural and linguistic savvy to enhance Malaysia's economic ties with Asia's two biggest growing markets, China and India.

Today over 90% of the civil service, police, military, university lecturers, and overseas diplomatic staff are Malay.

Even TalentCorp, the government agency created in 2010 that is supposed to encourage overseas Malaysians to return home, is headed by a Malay, with an ALL-Malay Board of Trustees.

To meet its much-vaunted goal of becoming a developed nation by 2020, Malaysia needs to grow by 8% per year during this decade. That level of growth will require major private investment from both domestic and foreign sources, upgraded human skills, and significant economic reform.

Worsening racial and religious tensions stand in the way.

Malaysia's government might find it politically expedient to stir the racial and religious pot, but its opportunism comes with an economic price tag.

Its citizens will continue to vote with their feet and take their money and talents with them.

And foreign investors, concerned about racial instability and the absence of meaningful economic reform, will continue to look elsewhere to do business.

-John R Malott
(former US Ambassador to Malaysia)