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Global Players

Global Players

June 2010

Najib Razak, Prime Minister, Malaysia

“We need to understand that the era of government that exerts excessive control, and has an attitude of ‘government knows best,’ is over.”

— Najib Razak, 2009

It is with these definitive words that Najib Razak took over as Malaysia’s Prime Minister in April 2009. And with his whirlwind of progressive measures, it has not been too long before Razak has taken Malaysia by storm.

Razak belongs to a venerated political dynasty in Malaysia, with a father and uncle who both also served as Prime Ministers. But that doesn’t mean that it is business as usual.

Razak has proposed far-reaching initiatives that have added cohesion to the financially frayed hinges of Malaysia, a country which has also lacked a socio-political center thanks to its cultural medley of ethnic Malays, Chinese and Indians. When Razak donned the hat of Prime Minister, he was already acting as the country’s finance minister, and grappling with a Malaysian economy still in the throes of its first recession in a decade. Politically, Razak was faced with equally big challenges. The ruling party to which he belonged, the United Malays National Organization (UMNO), was torn apart by internal politics and corruption.

Through the introduction of a set of restructuring policies known as “1Malaysia,” Razak seeks to weave a new quilt of national unity and step up Malaysia’s competitiveness by diluting pro-Malay leanings and promoting social equality. Razak insists that this refashioning of the country’s thinking is, “merit-and need-based, transparent and market friendly. Race should not be the main criteria in implementing economic and social-economic policies.”

Razak started off by implementing the Government Transformation Program, targeting six key areas that needed immediate attention, namely crime, corruption, education, low income households, rural infrastructure and urban transport. And with the professionalism of a seasoned corporate executive, he set up Key Performance Indicators (KPI) that measured progress in these areas, demanding accountability. The evaluation of ministries was established, complete with performance reviews every six months, while senior government officials and ministers are now required to present precise goals and detailed job descriptions. Razak also restructured his entire cabinet, appointing highly educated, relatively young and tech-savvy officials, who were at ease using new age mediums like Facebook and Twitter to communicate to the people.

Political overhauling apart, Razak introduced the New Economic Model intended to speed up Malaysia’s makeover “to become one with high incomes and quality growth over the next decade” as he defined it. Aimed at encouraging knowledge based industries, increasing income and productivity of workers as well as attracting foreign investment, the model seeks to spur the Malaysian economy onwards at a galloping pace.

Razak did not stop at fixing political machinery and financial chinks. In a paradigm shift, the economics graduate from the University of Nottingham has adopted an attitude of transparency and broadmindedness to darn Malaysia’s social divisiveness. Malaysia’s partiality towards ethnic Malays in business is well documented, and Foreign Direct Investment (FDI) was a tool of this bias. In the 1970s, Razak’s father, as the then Prime Minister, introduced a rule that afforded ethnic Malay investors the privilege to possess a 30% stake in the country’s listed firms. But with time consuming procedures and corruption, FDI had slowed down in recent times to barely a trickle.

Razak, a keen golfer, was one of the youngest members to be elected into Malaysia’s parliament in 1976, at just 22 years of age, when he won from Pekan, which his father had represented previously.

In June 2009 that all changed. In one of Najib Razak’s most significant steps, he repealed his father’s mandatory law, allowing the rest of the Malaysian population, primarily Chinese and Indians, a more equal stance. Now, Malaysia expects at least $12.2 billion worth of investments in 2010, much higher than previously expected.

Breaking the mold, and implementing sweeping changes has taken courage. And then some. But Razak’s willingness to transcend traditions and disturb deep-set Malaysian patterns has woken up a country used to sleepy administrative officials, whose hands were bound with red tape and rusted ideologies. “He has taken the smart step of taking the more painful decisions early in his administration,” quips an unnamed foreign political consultant in the Financial Times.

And Razak’s smart steps to transform Malaysia are showing promise. According to the government, efficient police patrolling and installation of CCTV systems have slashed crime rates by 32% in the first two months of 2010 compared to 2009. What’s more, the Malaysian GDP has accelerated at 10.1% year-on-year in the first quarter of 2010, its fastest ever expansion in a decade.

Yet, Razak has not escaped criticism. “There are questions involving corruption, particularly involving submarines and defense contracts, which continue to haunt him,” notes Bridget Welsh of Johns Hopkins University to The Telegraph. Although Razak has staunchly denied any wrongdoing on his part, the air remains heavy.

It is true, Razak’s blue blood and his advantage as the inside man might have helped him in the implementation of his radical reforms. But a driver of progress need not question his route. For now, it appears that Razak is cruising quite sensibly.





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