Why Terengganu Malays should no longer vote for UMNO/BN

In the first part of this article (see Why Malays should no longer vote for UMNO/BN), I highlighted the historical aspect of the general election in Malaysia and linked the election promises made by Umno/BN to certain policies of the government like the NEP and the mega projects.

The conclusion of the article was that the Malay voters should have rejected leaders from Umno/BN a long time ago for their failure to fulfil the targets and objectives of the various policies including the NEP. Also, many of the Umno leaders from that era were enriching themselves under the guise of the NEP implementation.

In this second part, I would like to highlight further the failures of the Umno/BN led government with a specific case study on the state of Terengganu.

The reason why I chose Terengganu is quite obvious. Apart from Kelantan, Penang and Sabah, Terengganu is the only other state that has been ruled alternately by both Umno and PAS. PAS first ruled Terengganu for over two years from 1959 to 1961, and then again from 1999 to 2004.

About 95 per cent of Terengganu’s population of 1.1 million people are Malays and on the basis that they are a group of politically conscious voters, I think it would appeal to them if they could consider making changes to the national political landscape instead of focussing their attention purely on local issues.

The Malay voters in Terengganu should have a strong motive to spearhead the change, due to the failure of the previous Umno governments to develop the state and bring them up to par with the mainstream national economy and development.

Terengganu is rather isolated. In terms of physical connections, it lacks modern infrastructure facilities and economically, it has also failed to attract foreign direct investment. Terengganu is lacking in terms of social and educational facilities, has a high unemployment rate and is geopolitically disengaged from the national issues and agenda.

Terengganu's chance to lead national politics

This GE is a good chance for Terengganu voters to assert their positions, to stand up and be counted, and even take the lead in national politics.

Although Terengganu is Malaysia’s largest producer of crude oil since the early 80s, the state remains as one of the poorest in Malaysia.

For instance, in 2012, Terengganu’s average crude oil production was about 260,000 barrels per day, which was slightly more than half of the national production of 505,000 bpd. On the assumption that Terengganu’s Tapis Blend could fetch about USD100 per barrel throughout 2012, Terengganu’s state government share of the oil royalty (at 5%) would have been about USD1.3 million per day or USD474.5 million per year.

But our statistics department shows that Terengganu’s GDP per capita is only RM19,225 as compared to the Malaysia’s national average of over RM48,000 in 2012. This means that despite its important contribution to the national coffers in the form of oil production, the average income of the people in Terengganu is only about 40 per cent of the average Malaysian. This is indeed a sad situation.

Even then, RM19,225 is still a misleading number. The state GDP includes the crude oil production figures which actually go to Petronas instead of directly to the state. Therefore, when the state GDP total is divided by the state population figures, it produced an artificial per capita income of RM19,225, a number that does not reflect the true picture of the income for the people in Terengganu. This exaggerated figure is a far cry from the realities in the state due to the fact that majority of the population are actually in the low income bracket while many hang just above the poverty line.

So RM19,225 figures actually does not reflect the true average income of the people in Terengganu. If the GDP shown has been overestimated due to the crude oil production, then one can say that the average population in Terengganu earns a lot less than this figure in a year.

The truth is, firstly, not many Terengganu citizens are involved in the employment to produce 260,000 barrels of crude oil. Secondly, even if a few of them are involved in the production, their income could not be so highly skewed that it influenced the income of the majority and made the average as high as the above. Thirdly, statistics generally show that the majority of the Terengganu Malays are involved in sectors other than oil & gas, such as fishing, farming, forestry, government service, small-time trading and crafting.

The Why's in Terengganu

Now the issue here is not just about statistics as statistics, similar to politicians, can also tell lies and very often get away with it. The issues that are at the centre of this case study are as follows:

• Why is it that despite the discovery of oil and gas in Terengganu in mid 70s and followed by production in early 80s, so few local people are engaged in the oil and gas sector?

• Why is it that despite more than 30 years of experience, local people from Terengganu are still not capable to be deeply involved in this industry, let alone helming it?

• Why is it that despite the much publicised policy discussions by various politicians on the subject of technology transfer, not many local Terengganu companies are involved in the provision of services that support this sector of the industry?

• Why Terengganu is under developed in almost every aspect and sector of the economy?

• How come the income of the people in Terengganu is only a fraction of the national average given that the cost of living such as car price, petrol, consumer goods, taxation, etc. are the same throughout the country?

Perhaps, the answers are known to Terengganu voters.

All these questions must be taken seriously in this coming GE. These questions are directly linked to the times when Terengganu was once administered by an Umno leader, Wan Mokhtar Ahmad, the Menteri Besar that ruled Terengganu from 1st September 1974 till November 1999. He ruled - or misruled - as the case maybe, for over 25 years.

The voters must be aware that the present conditions and situations are direct results of the leadership failure and policy disorder of yesteryears.

Similar to the failures of Mahathir’s policy for the whole country, Terengganu suffered due to ineptness and poor leadership. The voters should have rejected such a leader at the outset and not wait for 25 years.

Wan Mokhtar was eventually defeated in his Bandar Chukai constituency by PAS candidate Haji Awang Jusoh by a margin of 436 votes in 1999 GE. The people of Terengganu should recall how Terengganu stood still during his period of administration. Instead of developing the state the MB was more interested in winning political battles against PAS.

Far from been a good administrator, he also lacked technical capability, ideas and vision to move the state to the next level. Employment was not readily created, investors were hardly invited, state economy remained stagnant and potentials in the oil and gas were not tapped to benefit the local populace.

The MB had no clue on how to get the people to participate in the newly found wealth of oil and gas. He never came up with any blueprint or master plan, let alone state policy on oil and gas exploration and production. He hardly took the initiatives to learn or copy from established countries like Norway, Qatar or the UAE. His fall-back position was always to use the State Economic Development Corporation (SEDC) to participate and hold equity.

Whilst Norway set and built up Petroleum Fund and later on Sovereign Wealth Fund (SWF) for the long term investment, Terengganu formed Perbadanan Menteri Besar (PMB) as an investment vehicle using the oil royalty money.

A lot of PMB’s investments went horribly wrong and their incompetency in managing such a fund was glaringly exposed.

Investments in MacAir, a domestic airline went belly up and so did the investment in Suterasemai, a mulberry plantation to produce silkworms and silk. Scores of other ventures including the opening of new townships in the interior of the state under Lembaga Kemajuan Terengganu Tengah (Ketengah) never took off and were mainly a waste of space and resources. Later on it was discovered that timber was actually the prime target.

Resurrection of Wan Mokhtar

In this coming GE, the dynasty of Wan Mokhtar is represented by his son Wan Hakim (right in pic) who is contesting the state seat of Air Putih in the Parliamentary seat of Kemaman. I am sure to many voters in Terengganu; a 25 year term under Umno/BN’s Wan Mokhtar was a long and wasteful period. I would not recommend for it to be renewed by another generation of Wan Mokhtar, yet again!

Terengganu needs a capable leader who understands the needs of the oil and gas industry. One who can strategize, plan and programme a full participation of its population into this important and lucrative industry. One who creates employment opportunities, turning business potentials into realities, participate effectively and eventually helm the industry.

No doubt the income is big and when the agreement is honoured its royalty should be paid by Petronas. What more when PR led government has promised a revision of up to 20 % oil royalty for Terengganu, Kelantan, Sarawak and Sabah, the four oil and gas producing states. This should be seriously considered by the Terengganu voters.

There is also a need to set up Sovereign Wealth Fund, in similar fashion to Norway and Abu Dhabi, for the future generations when the income from oil and gas run out. The last thing Terengganu voters would want to see is the use of oil money to fund the Monsoon Cup or end up in the accounts of 1MDB.

For Terengganu Malays, the need to vote wisely in this election is absolutely critical. Time for improvement has come and they should no longer be satisfied with their present state but look for a party that will bring about change; which is so desperately needed; to Terengganu.

* Dr Rosli Khan obtained his PhD in Transport Economics from Cranfield University, UK. He has been a practising consultant/company director in the last 25 years, being involved primarily in infrastructure development and economic policies.

-harakahdaily