Sunday, August 29, 2010

Economics @ Home © Volume 2 Issue 18

Inspire me, inspire me not

Below is a story published by the Star on 16 Aug 2010, about a Malaysian girl who overcame one of the greatest adversities to achieve a success many of us can only dream of. I am certain that June is not the only person in Malaysia who has faced the same kind of obstacle that exists because of the poor culture of “un-meritocracy” in Malaysia. Please read through the interview below carefully and I will share my thoughts below.

Tiong gets it right in Harvard
Story and photo by YU JI

AT just 23 years old, June Tiong - straight As student, ex national squash player and Harvard University undergraduate - has a heck of a CV.

Few young adults have accomplished more, but her success has not been without setbacks.

As a squash player, Tiong had always played one age-category above her own. By 17, she was ranked fourth in Malaysia’s junior category.

But her first heartache did not arrive on court, it came when she was rejected by a government scholarship. Perhaps rebelling, Tiong quit playing squash for the country, and proceeded quietly to Form Six.

On solid ground: Tiong had a second chance at higher education when Harvard University granted her a scholarship.

Such stories are not unheard of, but zooming in on Tiong, what was apparently not good enough by local standards was good enough for Harvard University.

About three years ago at 2am, Tiong, fast asleep, received a phone call informing her that the world’s most prestigious university had granted her a scholarship.

In an interview with StarMetro on her summer break, the Chemistry undergraduate talked candidly about the importance of speaking up, her “awesome” roommate who cooks for her, and whether she wants to return home for work.

Question: Can we begin with your family background?

Answer: Sure. I’m the youngest and I have two other siblings. One is working in Kuala Lumpur, and the other, a student at a private college here. I was a student at St Teresa Kuching, before doing my Form Six at St Joseph’s.

Q: What were your SPM and STPM results?

A: Nine A1s and one A2. In STPM, I got three As and one A minor.

Q: Did you apply for government scholarship and what did you apply for?

A: Yes, I did. I applied for the Public Service Department scholarship, but they rejected me. I applied to do pharmacy.

Q: Did you find out why you were rejected?

A: I was rejected because they told me my results weren’t good enough.

Q: Were you offered a place at a local public university after Form Six?

A: Yes, I was offered a place at Universiti Malaya.

Q: How did you feel when you found out you were rejected for the scholarship after Form Five?

A: Well, honestly I thought it was sort of unfair, especially given my sports achievements. I also felt that, even with just my academic results, they were pretty good.

After that, I told myself, well, fine. I can’t dwell on this. Behind every cloud there is a silver lining, I kept telling myself; and furthermore, I got to stay home for another two years for Form Six.

Q: Was there a particular area of study you enjoyed?

A: Not really. Not in primary school, and at secondary school, as you know, everyone goes through the same drill. I was in the science stream. I don’t recall having a particular favourite subject.

Q: But every young kid has an ambition. What was yours?

A: I went through a lot of phases. [Laughs]. First I wanted to be a doctor, then I wanted to be an architect, and at some point later, I wanted to be a veterinarian. I’ve been through many kinds of ambitions.

Q: So why chemistry at Harvard now?

A: Well, besides chemistry, I’m also trying to get a second major in archeology.

Q: How did you get into Harvard?

A: After STPM I was applying for several things along with several friends. My coach also chipped in to help. At that time, he was promoting squash to other young kids. I was helping out a little bit. One day, he told me, “Oh June you should be applying to universities in the US too. Your squash achievements will help.”

He had contacts. He had advise from sports coaches he knew at Yale and Princeton.

Q: Was there an interview? I can’t imagine Harvard accepting undergraduates without interviews.

A: Yes, there was one. But even before that, there was a lot of paper work to do. Only short-listed candidates will then be given interviews. I was granted just one interview. That was in Kuala Lumpur by a Singaporean interviewer.

Q: Were you the only Sarawakian at that interview?

A: No, another girl from my school, Jacintha Tagal, the daughter of the late Dr Judson Tagal (Ba’ Kalalan assemblyman who perished in a helicopter crash at Bario in 2004) got into Harvard the same year with me. So, it was like, awesome.

Q: Okay, so why chemistry? That’s about as far away from architecture as you can get.

A: I guess coming from a Malaysian education, being in the science stream, made me think about a career in science.

Q: What year are you in now?

A: I’m in my third year. It’s a four-year course.

Q: Any more Malaysians in your year?

A: There’s three of us, another is a boy from Kuala Lumpur. Next year, there will be a total of seven of us.

Q: How is it like to study in Harvard?

A: It’s pretty stressful but it is also a lot of fun. The style of learning is also very different from Malaysian education. They really want you to ask questions in class. They encourage you to think out of the box. We have assignments every week that goes towards your final grade. Basically, it’s a continuous grading system. Classes are very diverse too, in the sense that, even though I’m a chemistry undergraduate, I’m taking up archeology, photography, history and even classes on Confucius.

Q: Do you feel pressured being at Harvard? I mean just living up to expectations?

A: No no, I’ve never felt that way. I have the coolest parents ever. They’re always telling me to go have fun. They’re like, “Go watch a movie. Stop stressing out,” and I’m like, “Mum, I don’t have time”. [Laugh].

Q: That’s what I mean, you must feel like you’ve got a lot to accomplish. No?

A: I don’t feel that way. My parents have always told me to enjoy life, and that’s what I’m doing now.

Q: Growing up, did you ever attend tuition?

A: Not really, except for Additional Mathematics.

Q: So you’ve always self-studied?

A: Kind of. I used to have a friend who studied all the time. She kept inviting me but I was always ‘too tired’. [Laughs]

I’m someone who derives a lot of energy from my friends and family.

Q: From a Malaysian education background to Harvard, were you well prepared?

A: Honestly…not at all; at least not for the first few months. I had difficulties speaking my mind. We had to participate in all kinds of discussions, and for the most part, I just didn’t know what to say. Malaysian education doesn’t really prepare you for that.

It would be good to have more group discussions within Malaysian classrooms. I suppose it’s really about encouraging young kids to talk. I feel a lot of Malaysians are not ready to have discussions. I mean, once you go into the working world, all of us have to deal with meetings, presentations, or just to come up with good ideas.

Q: Let’s move onto sports. Are you still playing squash?

A: I started playing at the age of 10. My mum felt I was too meek. After playing, I started to open up. I played in the junior circuit competitions once a month. I had the opportunity to go to many places, but by 17, I had quit. At that time, I was ranked fourth in the country in the junior category.

Anyway, so now, I’ve started playing for my school again. It’s an inter-varsity league kind of thing.

Q: Having excelled in sport, growing up did you ever want to make it your career?

A: No, never. I just don’t think I have that much passion in it. It’s something I’ve always enjoyed doing. As a career? No, I don’t think I can be that good at it.

Q: It’s often said that the Malaysian education system neglects sports. What are your opinions?

A: For sure the government needs to emphasise more on sports. In the US, sports is really big. It’s part of their education. As for me, I know very well that it was a stepping stone into college.

Q: Are you the only Malaysian on Harvard’s squash team?

A: Yes, I am. But it’s really a team thing. We train three hours every day, and absolutely do not drink alcohol during the squash season.

On the weekends we have matches. I think there are two other Malaysians playing squash for other Ivy League schools.

But to go back to your question about sports in schools, a lot of people assume that the reason I’m still playing squash at Harvard is because I have to; because I got in under a sports scholarship. But that’s not the case. I don’t have to play the game. I continue to play because it is fun. And making learning fun is really important.

Q: To cap off the interview, will you come back to Malaysia to work eventually?

A: Yes I would love to. But I would like to work overseas for a couple of years first. Maybe the US, maybe Europe, maybe Australia. I think that kind of experience and exposure is very important. Ultimately though, Malaysia is home. It’s about friends and family really. Food is a plus too.

Q: Is it possible to get Malaysian food in Harvard?

A: Yes there is one actually but it’s a bit far away in Boston and I don’t have that much time to travel. Anyway, Jacinda is my room-mate and she loves cooking. [Laugh]. She’s always like, “Hey dude, here’s Malaysian food,” and I’m like, “Woah, okay. Awesome”.

Even talking about food, I’ve come back to friends and family again. My parents, my friends, my coach has always told me to do well in school, do well in squash, and the world is your oyster.

This seemingly amazing story is made even more amazing simply because she is Malaysian. Sadly, this is not a success story of Malaysia Boleh. If anything at all, this story exemplifies why Malaysia Tidak Boleh. How do you explain that one of the best universities in the world can recognize the talents and abilities of this young girl, yet our government, with its vast resources and “foresight” did not see any “potential” in her. Or was something else at play?

After serving the country by representing Malaysia in squash, June’s services were repaid with a cold shoulder when she needed it most. She was one of the more fortunate ones to land a scholarship to Harvard after Form Six. Many of us (I was one of the more fortunate ones), had to face this obstacle yet AGAIN after Form Six, when we apply for university. Many students with excellent results could not enter the universities that they desired and worse, were only given their 8th or 9th choices for the desired course. Imagine, a student so passionate about Astronomy being sent to a university in the outskirts beside the jungles of Malaysia to study Biology. Do we know the detriments of such an action? Instead of having a world class astronomer in the making, we have a mediocre biologist at best instead.

When I read June’s story, part of me wants to feel inspired by her achievements, but a greater part of me feels so discouraged by the fact that my children may not be as fortunate as June when they finish Form Six. What if my children get sent to the jungles of Malaysia to study advanced pottery, simply because our system chooses not to recognize the talents and abilities of Malaysians? Yet, the 10th Malaysia Plan talks about attracting and maintaining talents.

I want to feel inspired but I simply can’t.

Sunday, August 15, 2010

Economics @ Home © Volume 2 Issue 17

Doing it without FDI?? Are you kidding?

When I saw such a huge heading in the online version of the Star, I was extremely shocked. After reading through the whole article, I was totally appalled because at the start, I was thinking, “Who is this Gunasegaram to say that Malaysia can do it without FDI?” Then at the end, I found out that he is actually the Managing Editor of the Star. Why is a journalist pretending to be an economist? What will happen when the ignorant public start listening to people like Mr Gunasegaram here? Let’s have a read about what he said. I have included his whole article here:

I have included comments where I deemed it necessary.

Saturday July 31, 2010
10 ways of doing without FDI
A Question of Business
A STIR of sorts has been caused by the story that foreign direct investment (FDI) into the country for 2009 fell 81% to US$1.4bil (about RM4.5bil) from US$7.3bil (RM24bil).
But really it should not. If we want higher value-added, then labour-intensive industries are not our target. This is the area which many foreign investors like because they can get tremendous cost savings by using cheap labour in places like China, Vietnam etc.
If greater value-added is what we are after, then increasingly more investments have to be made in the services area – think tourism or education for instance. That does not necessarily need foreign investment – we can use local money.
We have plenty of money in Malaysia – as much as RM250bil at last count. That’s roughly the excess of deposits over loans sitting with the banks throughout the country.
All that money and nowhere to go within the country, is our problem. The money is not chasing investments in the country. And that can mean only one thing – there is a lack of opportunity here. (This is just a nice way of saying, the investments around are too poor, especially the investment climate that is totally not conducive and transparent)
The question then is what is it that is reducing business opportunities in Malaysia? Is there too much red tape? Are approvals not forthcoming? Are there too many equity strictures? Do we have sufficient workers?
FDI flows in any particular year into Malaysia pales in comparison to the amount of idle money in the system. What we have to do is to find ways to use that and we will more than mitigate the effects of reduced FDI. Here are 10 ways we can do that.
1) Shift from manufacturing to services. This is inevitable if you want to move towards higher income. Our manufacturing is low value-added. Much of it is low-end assembly. Things like tourism and education offer so much more opportunities and are already large contributors to foreign exchange savings; (This is utter rubbish. The way up is not a change in sectors. Just liberalize the economy and let the private sector and the market determine what are the goods that have demand, then those are the goods that will be produced. Furthermore, we can never do without manufacturing. The value-addedness per worker in the manufacturing sector is simply too large. Even in the advanced countries such as Germany still have a huge manufacturing sector)
2) Reduce export dependence. Old habits die hard and we must realise that we cannot continue to export ourselves out of trouble all the time. What we must do is create a market for ourselves right here. Get our consumers, who seem to have a lot of money, to spend – think restaurants, entertainment, lifestyle etc; (AGAIN, total rubbish. It is precisely this inward looking attitude that was “introduced” by our 4th Prime Minister that has caused so much destruction in our economy. Once again, the market should decide what to produce, what to export, and what to import. To produce domestically is not as simple as Mr Guna suggests. Take Proton for example. Without the subsidies that the government pays them, they would have gone bankrupt a long time ago. This protectionist measure has cost the Malaysian public billions of RM. Once again, just let the invisible hand decide where our money should go)
3) Identify and target the high growth areas. Old-style low-cost manufacturing is out. We need to identify some areas for good growth in the future and focus on this. We could easily become a quality education hub for the region for instance and benefit ourselves in the process. We could set aside areas for international universities to be set up; (Need I say it again? Liberalize the economy. Let the private sector decide where their money should be most efficiently spent. Mr Guna is simply a product of the Mahathir mentality. You think the people are too stupid to decide how to spend their money?)
4) Make incentives the same for both domestic and foreign investors. The days of giving more incentives, latitude and preference to foreign investors must end once and for all and the playing field levelled. In fact, greater encouragement and incentives must be given for the development of local enterprises based on the simple premise that we must help ourselves more; (Totally contradictory. In the first sentence, he says that we should make incentivest eh same for both domestic and foreign investors. Then in the third sentence, he asks for greater incentive for local enterprises. I think he has no idea what he is talking about anymore. Equal opportunity is best. There is no need to give “crutches” to Malaysians. We must inculcate this culture of competitiveness as soon as possible. Or else we will be sending our children to Indonesia to become their maids very soon)
5) Cut tariffs and taxes. Tariffs are non-competitive and cutting them increases competitiveness of all industries as they are able to source supplies and services which are the cheapest and of the best quality. Cutting taxes provides incentives for making money. Our taxes are still relatively high; (Then where is the government going to get money from? Hasn’t anyone told you that our budget deficit looks just a bit too much like Greece? Does blood really have to spill on the streets before someone realizes that Malaysia needs to wake up and wake up now?)
6) Do away with equity targets altogether. With bumiputra equity targets probably already met if we measure using the right techniques, there is no need to force non-bumiputra industries to continue to enter Ali Baba-style partnerships to do this, a highly inefficient process that benefits very few bumiputras in any case; (First smart thing he said so far. But who doesn’t know this already?)
7) Cut red tape. For all the lip service made to cutting red tape over the years, this is still very much with us. As long as officialdom puts all kinds of barriers in the way of genuine enterprise, expect enterprise to be hobbled; (This is number 7?? I already said this right at the start. Liberalize, liberalize, liberalize!!)
8) Do away with yearly renewal of licences. If you already have a licence, why renew it yearly? Why can’t it be given to you indefinitely unless you flout licence requirements? Doing away with licence approvals on a yearly basis helps cut bureaucracy; (Please see comments from number 7)
9) Improve educational standards. We can’t emphasise this enough and the steady decline in educational standards both at schools and universities has not, so far, elicited a strong enough response from the Government which will stop the slide; (All talk but no substance. Mr Guna, if you are so smart, perhaps you might give a concrete suggestion as to how to do this? If you can pretend to be an economist, maybe you can pretend to be a politician too? Simply promote a culture of meritocracy. Let people appreciate the value of competitiveness. Almost everything else will follow) and
10) Cut corruption. This insidious, widespread problem is eventually the cause for much bottleneck, inefficiency, higher costs and a downright hindrance to improving productivity at all levels. It’s incredible how little we have done to stop this scourge. (It’s incredible that Mr Guna has not said anything that we don’t know in such a long article. Maybe we need to give more voice to people who actually know what they are talking about)
Yes, FDI has dropped and it may continue to drop. But really, that’s not the end of the world. Anyway, it’s high time we reduced dependence on FDI and did something to pump up domestic investment instead. And there are many more imaginative ways to do that. (No FDI will be the end of Malaysia! Does Mr Guna realize that the benefits of FDI is not just limited to  investment? Does Mr Guna even relize what investment is?)
Managing editor P. Gunasegaram is amazed that some foreign companies are taxed by their home countries for the taxes they don’t pay here; in other words, the tax incentives given to them here goes to a foreign country instead. (I am amazed that people who have a "voice" do not take their privilege seriously)

Just some additional comments. Let me just list down A FEW of the benefits from FDI that CANNOT be obtained from just domestic investment. FDI allows transfer of technology. It allows foreign companies to bring in new technology that can provide value add to our local industries and workers. FDI allows foreign companies to bring in new training methods and foreign experts which can help train and improve productivity of our workers. FDI also creates a competitive business environment that forces local businesses to stay on their toes and not rest on their “laurels”, if any at all.

This article from Mr Guna is a simple example to show that we cannot simple believe every person who has a voice. What he wrote only appears intelligent on the surface. Any real economist will know that a developing country CANNOT survive without FDI. Only Mahathir will agree to something like what Mr Guna said.

If you think I have contributed nothing but a harsh criticism of Mr Guna, then the least that you can do is to note that Malaysia needs FDI and I have given you enough reasons why.

Sunday, August 01, 2010

Economics @ Home © Volume 2 Issue 16

Why Singapore Leads the World in Mathematics

I always wondered why we label the Singaporeans "kiasu" (afraid of losing). Despite studying there for two years, what I discovered was a culture that amazed me. What is referred to as the culture of competitiveness in Singapore, is gravely misrepresented by Malaysians as kiasu-ism. For whatever reasons we deem Singaporeans to be kiasu, be it jealousy, or what we call the "truth", the fact remains that the GDP per capita of Singapore is at USD35 000 and the GDP per capita of Malaysia is struggling to breach USD7 000.

I can present you with all kinds of facts and statistics to show you why Singapore is so much better than Malaysia, but that would probably be in conflict with my day job. Instead, I will let the video below speak for itself.

The first thing that struck me after watching this video was how much thought the Singaporean government has put into educating their pre-school children. The Malaysian government has always preached about accessibility this and that, but the fact is, the quality of our education is not there. The amount of thought put into it is clearly exemplified by the amount of flip-flopping that has to happen even before we can decide on what language to use as a medium of education, notwithstanding the fact that they most probably made the wrong choice.

And here we have Lee Kuan Yew, one of the more visionary people in this age, calling for China to embrace English in their bid to become a global superpower. It seems to me that we are moving in the opposite direction. What a sad case we are...