Trapping
Suaram (Suara Rakyat Malaysia) for whatever reasons is alike plodding
on a dangerous path for UMNO and this will further dip Barisan’s hopes
in the next general election.
Suaram is a body that is apolitical and
operates on the basis of social justice for all Malaysians. Founded in
1989 the aims and objectives are for the protection and promotion of
human rights and the development of public awareness in Malaysia.
As reported, UMNO leaders have insinuated
that the American non-governmental organisation (Open Society Institute
presently called Open Society Foundation) that funded Suara Rakyat
Malaysia (Suaram) is linked to currency speculator George Soros.
To promote democratic government
It was alleged that Open Society Institute (OSI) channelled funds in excess of
US$
180,000 (RM558, 556.92) to Suaram the period 2007 to 2010.By virtue of
this – the Soros factor – UMNO is beating the political drum to dupe the
rakyat that it is “immoral” for Suaram to accept money from the
organisation.
Suaram cannot be blamed even if it has
received the funding. The network of Open Society Foundations or OSF
(named Open Society Institute or OSI until 2011), is a grant making
operation started by George Soros, aimed to shape public policy to
promote democratic governance, human rights, and economic, legal, and
social reform.
OSF works to build alliances across
borders and continents on issues such as combating corruption and rights
abuses. This is far from any anti-money laundering or pro-terrorism
activity that can be classified under the Anti-Terrorism Financing Act
2001.
Suaram has no record whatsoever of being a
body that promotes terrorism. Neither is Suaram in cahoots with Soros
to damage the country. Yet, to some UMNO leaders Soros was alleged to
have “damaged” the country’s economy in the past.
Soros was never the “devil”
For political reasons, the chorus calling
for the demonising of Suaram has included many other pro-UMNO NGOs and
also the former Prime Minister, Mahathir Mohamad. They feel that it’s
wrong to accept aid from any organisations that are connected to Soros.
Little do these armchair politicians or
proponents of virtues realise that Soros was never the “devil” that
caused the 1997-98 Asian Financial Crisis that involved Malaysia. As for
Malaysia the real “devil” could have been leaders from among UMNO’s
rank and cronies.
Soros was politically perceived by
Mahathir as the perpetrator of the 1997-98 Asian financial crisis. Soros
was the individual who sabotaged the country’s economy, so was the
allegation by UMNO leaders echoing what Mahathir had said about Soros
during the financial crisis.
Both Soros and Mahathir were actually
into currency speculation but the former was too nifty for the latter.
In fact, currency speculation was nothing new during Mahathir’s tenure
as Prime Minister.
The Malaysian economy was actually
incapacitated a few times by local currency speculators more than what
Soros had done in Asia.
It was bad governance; an economic bubble
and the involvement of local currency speculators who made Malaysian
economy vulnerable and the country lose billions when Bank Negara
started the FOREX business well before 1997. It was known in the forex
markets as the “rogue speculator” for its aggressive trading.
Soros is a businessman
Soros is a businessman who knows about
the economy and of course the prime interest of any businessman is to
make money. Mahathir was a politician who knew little about the economy
but tried hard to become a currency expert.
But being economically handicapped at the
time he had to depend on some of his trusted “expertise”(Nor Mohamad
Yakcop). When politicians and their inept cronies get into business,
more often than not they damage the economy.
It
was alleged that more than US$6 billion was lost in the FOREX market
during Mahathir’s tenure as Premier. Malaysia’s foreign reserve was
gambled away in 1992-1993. In fact it was alleged that Bank Negara,
during Mahathir’s time, was involved in global speculative activities
tacitly as early as in the 1980s.
Mahathir’s penchant for mega projects
Mahathir’s penchant for mega economics
projects did not work either. It only exacerbated the situation when
investors had low confidence of the nation’s economy. Investors trickled
in only for quick gains.
More than RM6 billion was unnecessarily
spent to build Telecoms tower in Kuala Lumpur and the high rise PETRONAS
buildings that did not benefit the country much. The multi-billion
ringgit national car project went awry and the buying of the RM300
million Lotus racing car plant did not bring much benefit to the
national car industry.
The billions spent on the MSC (multimedia super corridor) venture was more
hype than accomplishment. The abandoned Bakun project in Sarawak brought colossal loss to the economy.
The bailing out of failed companies and
Bank Bumiputera perpetually dented the nation’s coffer at the time.
Billions of Employee’s Provident Fund and PETRONAS dollars were used to
bail out projects given out to cronies at inflated prices without
tenders and all this incurred a big financial loss to the country.
Non-performing loans
More than a billion was lost for the
“purchase” of the Skyhawks from the US that was not delivered to the
country. RM6 billion was lost in Perwaja Steel Mill. More than RM3
billion was burnt in the BMF scandals. Cronies were allowed to borrow
millions from local banks without collaterals that ended up becoming
non-performing loans.
More than RM3 billion was lost from the
London Tin scandal when the US released their Tin Stockpile. From
1992-93 the country experienced more than US$6 billion FOREX lost by
Bank Negara. The list goes on.
As usual, the economic buffer was the hard-earned PETRONAS dollars – without which the country would have gone bankrupt.
Both shared a common desire
Just before the financial crisis
economists warned Mahathir that if Malaysia did not manage its economy
and finance right, it would suffer the same fate as countries that had
observed their currencies tumbling.
In 1992 the battleground between Mahathir
and Soros was the London foreign exchange market. Britain’s FOREX
market was the focus of many speculators who wanted to profit from the
market instability at the time.
Both expected that they were going to
make money from speculating on the British pound. Mahathir expecting the
pounds to appreciate gave the green light using billions of US currency
from Bank Negara’s foreign reserves to speculate on the British pound
sterling.
Soros – the global FOREX player –
expecting the fall of the pound borrowed 10 billion pounds from British
banks and changed the money to German Mark.
Malaysian speculator, Mahathir lost
On Sept 16, 1992, unable to stand the
economic and market pressure on its overvalued pound, Britain, instead
of floating the pound, officially devalued its currency causing the
pound to fall.
Soros, who took the loan from the British
banks, repaid it in pounds which was then cheaper and pocketed the
difference of more than US$1 billion.
While the Malaysian speculator Mahathir
lost about US$4 billion.As reported, later in 1993, Bank Negara again
lost another US$2.2 billion in speculative activities. Malaysia’s total
loss by this time stood at US$6.2 billion. The actual figures for Bank
Negara losses were never revealed, though.
Both the “gamblers” had the same desire –
to make money. But in the end when Mahathir failed, Soros made the
money. The stark difference here was that when Mahathir used the
nation’s money to bet, Soros used his own fund. The latter of course was
more righteous in this game of FOREX gambling.
Why then demonise Soros and his charity
work? The only reason must be because he was perceived by none other
than Mahathir that he was a currency speculator. For political reasons,
leaders within UMNO have forgotten and forgiven Mahathir for his past
“gambling” habit.
Lack of investor confidence
Soros earned a billion dollar profit from speculating against the British currency in 1992. Malaysia got her fingers burnt.
Preceding the 1997-98 Asian financial
crisis the annual economic “growth” rate of Malaysia was reported to be
8.5 percent for 6 years – from 1990 to 1996.
But a lack of investor confidence soon
attributed to a wave of currency depreciation in the inflated economies
of Asian countries at the time. Soros being a shrewd currency speculator
could foresee the economic collapse of a few Asian countries.
In mid-1997, when the Thai Baht
depreciated his fund managers sold US$10 million of Thai baht to make a
fortune. He did not sell Malaysian ringgit or any other currencies. The
depreciation of the Thai Baht was enough to lead to a domino effect on
some other Asian economies, including Malaysia.
It only showed that the economies of
these countries were not resilient enough.Short-term investors pulled
out their funds in droves resulting in the economic crisis in Malaysia.
The value of the Malaysian currency fell by more than 50 percent from
RM2.50 to RM3.80 to US$. The stock market index dropped and at one point
hovered around 300 points.
The “Mahathir factor” too affected the
stock market then. The country’s stock market fell each time after
Mahathir spoke against the economic market system.
To Soros, currency speculation is a
business. He confessed that he had no time taking part in currency
speculation for political purposes.
A serious business
Before June 1997, there were already
signs on the wall that Malaysia would face with economic problems but
this was ignored by Mahathir citing “sheer jealousy” of western
countries as the reason.
During the crisis it was the low
confidence level of investors in the country that led to huge capital
flights sensing that the economic bubble was going to burst. Even prior
to this crisis the economy of the country did not justify to the
confidence of markets – a reality that Mahathir did not want to admit.
After being badly mangled, the aftermath
of the financial crisis made Mahathir say that currency trading is
unnecessary, unproductive and immoral during the IMF and World Bank
meeting in Hong Kong which took place in mid-September 1997.
But the same was not mentioned after Bank
Negara lost US$6 billion or more in FOREX trading. UMNO leaders cannot
be too naïve not to comprehend this setback to the nation’s economy.
To Soros, currency trading is business
and weak governments have to be cautious not to create a bubble burst
upon being tested by currency traders. Managing a nation is a serious
business.
Singapore, Brunei and Japan, for
instance, were the least affected during the 1997/98 financial crisis
because of their economic resilience.
Finding scapegoats
Other UMNO leaders did not dare question
or speak up against Mahathir, instead danced to the master’s tune in
blaming Soros for the latter’s self-made debacle.
UMNO
is always good at finding scapegoats. Instead of opening up the case
relating to the Scorpene Scandal the leaders are trying to strike Suaram
with the “Soros factor” – exploiting on the fund Suaram received from
OSI.
However, the rakyat are not that
irrational to buy UMNO’s political ploy. They are just fervently waiting
for the French court to reveal the truth about the Scorpene Scandal
that involves UMNO, the country’s top leadership and his cronies.
Paramananthan said he suspected that the project was part of a smear campaign against the Selangor government.
The
extras were apparently kept in the dark about the subject of the
commercial. Many of them told FMT they were participating only for the
money.
“It seems like this is a tactic of the Umno-Barisan Nasional (BN) government to prevent 
Mereka
mendakwa penggambaran berskala besar itu mengganggu privasi,
menyesakkan kawasan, berunsur politik dan tidak memberikan gambaran
sebenar masalah berkaitan air.
Paramananthan
juga mendakwa, penggambaran itu mungkin bertujuan memburukkan kerajaan
negeri memandangkan tiada sebarang maklumat terperinci diberikan kepada
persatuan penduduk.
Sementara
itu, seorang penduduk lagi berkata, mereka hanya dimaklumkan
penggambaran iklan "khidmat sosial mengenai air" tetapi tidak
dimaklumkan ia berskala besar.
"Saya
dah kata tempat ini tidak sesuai untuk penggambaran. Tetapi mereka kata
mereka mahu lakukan kerana tempat ini sesuai," tambahnya.
