Boom & bust is natural all kind country, no matter how developed they are. It is the human effect in economic cycle, lepas tamak (boom) then menyesal (bust). But more importantly, every cycle will bring in new horizon. And this time, I think Malaysia need to change for good. This is why…
No More Cheap Labour.
Yup, I know we don’t have tens of thousands of ringgit in salary but compare to our ancestors, our gaji definitely more than them. For example, Mommy Finance survey shows that even at the age of 35 years and below, banyak yg dah dapat at least RM5K sebulan. Ask your dad, sure they said “ayah dulu kerja 25 tahun baru dapat merasa RM5K”.
Unless your daddy is so successful in corporate scene (CEO TNB ke or MD Sime Darby), chance are they will only earn RM5-7K right before retirement (only applicable for org makan gaji).
Why No More Cheap???
Firstly due to inflation. Our value of money has drop more than half compared to 30 years ago; no thanks to aggressive business owners yang sesuka hati naikkan harga without additional value. Rumah yang dulu harga RM100K, now at least RM200K; which mostly around RM350K mark. Roti canai yang dulu 40sen, now cost 80sen! Luckily kereta Proton remain the same RM60K; from Wira down to Waja & Gen2.
But then, not many people want to use proton anymore. This can be proved from reduction in proton’s market share than all imported cars. Paling cikai, Honda City & Toyota Vios seems to be the ‘minimum criteria’. This brings to the second reason to no more cheap labour; high taste of consumer spending…
Last but not least, degradation of RM than other currencies. This alone shouldn’t impact much. However, because Malaysian not producing enough products (except commodity like Oil & Gas, Sawit & Getah), we rely so much on ‘outsider’. Simple example, where is the last place you shop for groceries? The answer will most probably Giant, Tesco or Carrefour right?
Kalau Parkson ok jugak because it belongs to Malaysia. And I have share in that company too! LOL.
Our Biggest Threat
Even though we manufacturing all sort of semiconductors and electronic wafers, most probably that company not belong to our country (and its kroni). The owner must be either American, European or Japanese. Maybe ada la sikit-sikit share for Malaysian (which mostly just buat syarat) but very few yang ada controlling stake.
Hey, nothing wrong with that really. If you work there, keep on working! Jangan la resign pulak. Just that, it seems we are relying too much on foreign investors. What if they find other better places like China & Singapore? What happens to its employees?
And secondly we rely so much on commodity nowadays. Do you know that more than half of government revenue from commodity? And worse, 90% of them coming from petroleum related products. But you might think, what’s wrong with that?
Sebab utama, commodity prices tend to fluctuate in nature. Other than supply & demand factor, speculation is something you must take into consideration.
Then, oil & gas is non-recoverable resources. Sooner or later, our resources will depletes. Try imagine if 50% of duit government hilang. Agak-agak from where they are going to pay all government flagship projects (Koridor yang banyak-banyak tu) & government servants! Lucikly we have Petronas that struggles to secure resources from oversea.
Depending too much on petroleum can also create political/social tense & instability. Look at Nigeria; each political or social leader rush to get access to the petroleum dollar rather than focus on building their own nation. They end up killing each other almost forever. Are we ready for that?
Most people think that oil & gas business is simple. What they don’t know is, it needs billions of USD with only 30% or less success rate. It requires damn a lot of cash before you can see the first oil (if any) 4-5 years later. If it is easy business (or confirm profit), don’t you feel weird to see major O&G companies keep on partnering each other for every projects? If you know it’s profitable, definitely you want to keep all profits for yourself right?
But in this case if the projects fail (e.g. drilled well with no oil), they can lose multi-billion dollar together! Funny but true…
Economic Transformation after 08/09’ Recession
1900 till end of 70s, we are no more than agricultural country. We breed own goat, tanam own sayur & eat ikan from kolam/ sungai belakang rumah. Cuma when harga kopi naik, semua tanam kopi. When getah in demand, suddenly all change to getah. And now, as sawit super mahal, everyone nak beli tanah sawit.
In the 80s, we are among successful story for the electronics manufacturing businesses. Thanks to Dr. M who brings in massive FDI (foreign direct investment) project in Malaysia. That time Malaysia was like China now; cheap manufacturing cost centre.
Later in 90s, our economy booms after recession in 87-89s with super mega construction projects. That time any contractor (yes, any contractor!) make fortune from government construction spending. Within this period KLCC, Cyberjaya, KLIA, Putrajaya, KL Sentral & Sepang were born. Remember?
And now, after the 97’s Asian financial crisis, we enjoy super boom commodity prices from booming China businesses. CPO double in 3 years and Crude Oil quadruple in 8 years. This really bless in disguise. On one hand government reap in profitable income, on the other hand, Malaysian suffer from food & energy crisis.
The question is, what next?
Knowledge (& Attitude) Based Economy
Agriculture, construction & commodity based business will still grow. But competition seems to be the biggest threat esp. road to oversea market. Business gets rationalized (through Merger & Acquisition). I think, the new frontier will be ‘knowledge economy’. But what the heck is that?
Definition of ‘e-knowledge’ is indeed an open-ended discussion. As long as it means ‘turning knowledge into money’ you should score A+ already. However, the implementation can be a lot harder. So here are some examples:
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Your company invest thousands in training hoping that you can bring more money to the company’s bottomline, but how much you have contributed?
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Parent spends hundreds or more for their children’s education hoping their kids will grad with flying colours for first class salary, but what if they just hate reading?
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Or you, buying books even it cost hundreds of ringgit, but what have you done upon reading it?
The reason why knowledge based economy is the way simply because we need to go up the value chain. We can no longer depend on cheap labour for living. Or should I say, we should not expect naik gaji from no value added job (such as routine task everyday) and expect increased in salary. And that’s not fair!
Perception of naik gaji from seniority should be changed. it should be from how much value you have brought to your organization. And to do that, we need knowledge & positive attitude. Malaysia Boleh, remember? Lama tak dengar slogan ni kan??
I learn new things everyday. And keep a journal recording what’s good or bad & what works or not is good practice for me. This way, my kids, family & myself can leveraged on my knowledge; not to repeat the same mistake all over again. I can share with others for them to ‘beware’ & ‘be ready’; avoid mistake and straightaway do what works. I wish I know what I should do before doing anything. What about you?
If you have mastered in your field, you can easily monetize it whenever you want. For example, giving counseling for others, patent you idea for mass commercialization or publish your own Book. I have friends who just published his very first physical book out of nowhere recently. Nowadays, people want to learn from YOUR experience than FORMAL education.
Knowledge based economy comes with knowledgeable society. Then only we can say NO to irrational, nonsense & trash political talk yang banyak kat TV.
What do you think? Make sense?
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