Reveal bumi equity calculations, govt told 
Malaysiakini
Sep 27, 2006
Soon Li Tsin and Muda Mohd Noor

If the government has nothing to hide then it should reveal its methodology in calculating the percentage of bumiputera corporate equity ownership, urged a local think-tank.

Speaking at a DAP forum in Kuala Lumpur last night, Asian Strategy and Leadership Institute (Asli) Centre for Public Policy Studies director Dr Lim Teck Ghee said:

“We believe if anyone wants to challenge these figures we’re happy to discuss this with them. And we hope the government will take the initiative to open up the data.

“If there’s nothing to hide, if they say their data is correct and ours is wrong, let’s have it out in the open. Let’s have an objective academic discussion about it.”

In a study entitled, 'Corporate Equity Distribution: Past Trends and Future Policy', Asli estimated that bumiputera corporate equity ownership was around 45 percent, when based on September 2005 Bursa Malaysia figures.

This contradicted the statistics revealed in the Ninth Malaysia Plan which stated that bumiputera equity ownership remained stagnant at 18.9 percent between 2000 and 2004.

The bumiputera corporate equity ownership condition was aimed at bridging socio-economic disparities between the races under the New Economic Policy (NEP) after the 1969 racial riots.

Lim noted that the study was established based on the best available information and informed opinion and that the government does not make data available easily to the public.

Under the OSA

“A lot of the data was difficult to come by. It’s not available under the Official Secrets Act and so on. We’ve done our best,” he told the forum which was attended by 400 people.

He noted that every company that wants to be listed has to comply with the 30 percent bumiputera share requirement, otherwise they cannot be listed.

“So by hook or by crook, they sign this 30 percent. The Malays have two bites of the cherry because they have the reserved 30 percent and they can also bid for share in the public market,” he said.

Lim explained that the main reason why the bumiputera share could have fallen to 18 percent was because bumiputeras sold their shares to get windfall gains.

“They are not being a traitor to the race. They are merely following the market logic of someone from Wall Street, which is that if the price is high you sell it. This is not a racial characteristic,” he said.

He stressed that the government should not be so obsessed by this corporate equity target and that the NEP has outlived its relevance.

Incorrect facts

Contacted yesterday, Malay Chamber of Commerce Malaysia (DPMM) treasure general Zainol Abidin Abdul Hamid said that Asli’s study cannot be accepted because the facts are incorrect.

“Our government says corporate bumiputera equity is 18 to 19 percent, how can Asli say it is up to 45 percent?” he added.

Zainol Abidin said on the whole, equity ownership does not depict the success of bumiputera businessmen.

Universiti Putra Malaysia (UPM) economics lecturer Judhiana Abdul Ghani also disputed the findings.

She said many people would disbelieve the report because the distribution of wealth is not comprehensive.

“On the overall, the (30 percent) bumiputera equity ownership may have been achieved with the inclusion of GLCs (government-linked companies) but it is only focused on a small group while the rest of the community does not enjoy it.

“Actually what’s most important is to let more bumiputeras acquire that said equity,” she said.