Tuesday May 29, 2012
The message is in the figures
By KARIM RASLAN
Timing an election is an art in itself. Party preparedness, media messaging and how recent policies have fared are among the many factors that need to be weighed.
THERE are apparently a number of windows of opportunity for the coming general election.
The first is from June through to mid-July when the fasting month begins; the second is in September, after Hari Raya Aidilfitri but before Hari Raya Aidiladha and the third is in 2013 after the Chinese New Year.
Most of the other months are unsuitable due to a combination of festivals and floods.
Up until now, the Prime Minister has enjoyed the freedom and flexibility to choose between the various dates (or windows). Moreover, I should add that as far as I’m concerned, Barisan Nasional is slated to win the upcoming polls – all that remains undecided is the margin of victory.
However, turmoil in the global economy is narrowing the Prime Minister’s room for manoeuvring.
The election victory of Francois Hollande in France, the uncertainty in Greece (will they or will they not remain in the European Union?), the anaemic US recovery and China’s stuttering growth mean that the next few months look increasingly bleak – upsetting our own domestic policy calculations.
At the same time, last weekend’s victory by the Workers’ Party in the Hougang by-election in Singapore underlines the continuing recalcitrance of South-East Asian voters when faced with overwhelming establishment fire-power.
Timing an election is hence an art in itself. There are so many factors – party preparedness, media messaging and how recent policies have fared – that need to be weighed.
But after months of focusing almost exclusively on domestic issues, it’s no longer possible for Malaysians to ignore the international arena – especially in terms of the potential impact to our economy.
Of course, Malaysians of all political stripes have quite rightly been concerned about domestic issues – ranging from the expanding civil liberties agenda, racial politics, the role of Islam in public life and not to mention our usual gossipy political dramas.
Now, with a global economic crisis looming, the Prime Minister’s flexibility is fast diminishing. Indeed, he may no longer have the luxury of planning for polls deep into 2013.
The three great drivers of global growth (North America, China and most importantly, Europe) are all facing major economic challenges of their own.
As if that isn’t enough, the November Presidential polls in the United States and uncertainty over the upcoming leadership transition of the Chinese Communist Party at its 18th National Congress (also expected in autumn) have only exacerbated the risks.
But don’t take my word for it: The numbers speak for themselves.
China’s first-quarter economic growth has slowed to 8.1%, lower than the predicted 8.3%. Of course, this is still better than the Chinese government’s target of 7.5% and anything the West has to offer.
The problem, however, is that these figures are often deceptive. As the Financial Times argued recently, other indicators, including a decline in industrial production (growth was 9.3% in April 2011, down from 11.9% in March) and import growth (just 0.3% in April 2012 from a year earlier) show that China’s economy is slowing down.
Furthermore, HSBC’s Flash Purchasing Managers Index (PMI) for China, which measures industrial activity, fell to 48.7% in May 2011 from a final reading of 49.3% in April. This was the seventh straight month that China’s HSBC PMI has been under 50, indicating a contraction.
These surprising figures come in the midst of continued political fallout in the People’s Republic over the dismissal of Bo Xilai and its increasingly heated South China Sea dispute with the Philippines.
The United States, for its part, is still stuck in a weak recovery, with non-farm jobs rising by just 170,000 in April 2012, doing little to reduce its 8.2% unemployment rate.
India’s growth for this year will probably be only 6.9% – much lower than the 9% previously predicted.
Europe is now facing the kind of fear-induced currency devaluations that once plagued South-East Asia. Its political spasms, alternating between merciless austerity and bull-headed populism, reveal that it has absolutely no clue on how to move forward.
Needless to say, Europe’s indecision and political paralysis is a time bomb.
None of this is good for Malaysia. The above-mentioned are all major customers and buyers. Any global contraction or currency-induced panic will spell disaster for our trading-based economy.
Furthermore, if the Worker’s Party’s Hougang victory (despite the best efforts of the PAP’s big guns) is any indication, political sentiment is hardening on both sides of the Causeway.
To my mind, domestic political conditions in Malaysia currently are the best they will ever be, and the real worry for Datuk Seri Najib Tun Razak should be the international economy.
We need to hold the 13th general election, and soon. Malaysia needs a new government in place to be ready to deal with what will be a long and sustained global economic crisis.
Of course, the controversy over Bersih only adds to these challenges as questions of legitimacy rise to the fore. A mandate for action will only be authoritative if it is credible and broad-based.
The Prime Minister is well-known to be a thoughtful, risk-adverse man. Well, with June on the horizon and the economy worsening, delaying elections is the greatest risk he can take.