13/6/11 NOTES TO THE PRIME MINISTER (revised 4 March, 2014)

As I was a student in the 1980s, I heard a lot about Anwar Ibrahim when he was very active in ABIM, promoting the idea of Islamism in the management of the affair of the State. In fact those were the hard economic period of the early administration of Mahathir. Most students at the time, were so attracted to his idea of Islamic thought, but it doesn't move me as yet. But when he was taken in as Mahathir right hand man, despite lots of resentment by many in UMNO, stream of friends paid him a visit and referred him as Brother Anwar. He was said to be friendly, straight and simple. The spirit of Muslim brotherhood of the Egypt might had cropped into his aura.

(2) In August 1996, I went over to do my postgrad study in USA. In December, 1997 I returned to fetch my family to take them over. I have two young kids at five and three years old then. My net salary (take home), though I had served the government for 10 years, and since I was not concern to pass my Service Exam as quickly like others, which made my confirmation delayed for four years, was at that time merely over RM2,000.00/month. Such a delay affecting seriously my salary increment. At that time, the Asian Financial Crisis almost at it peak. When I remitted my saving RM10,000.00 to take care of my apartment rental, in January 1998, my account in Colorado shown me a bank in amount of merely U$2,000.00.

(3) I was shocked, I was sad, panic with family with me in a foreign country and nobody to turn to, with no more saving to mobilize. Nonetheless, that was the time which triggered me to take up subject on Money Economy at the Colorado University School of Economy. I didn't pass the subject because I used to argue and come to lots of disagreement with the lecturer whom was a Senior Fresh Water Economist (MIT) which by coincident was an egoistic Jew.

(4) Back home, I monitored closely the effect of Asian Financial Crisis to the Malaysian economy. I was mad when, Anwar accept the formula recommended by IMF for us to increase the Interest Rate and reducing the NPL from six months to three months period. The subject on Development Economic that I took at that time revealed countries such the Philippines, Latin America and some African suffered a lot when they subscribed to such an idea in 1970s. The crisis and academic teaching, made me to begin to understand what bad Macro-economic and Financial Policies means to the management of the State economic affairs. Though economic subjects were not the focus of Urban and Regional Planning School, I took the pain to cross over with real extra hours learning them.

(5) Upon returning from my Study in September 1998, that very morning I rushed over to my Office to inform the Management that I would like to turn up to work the very next morning. At late morning, I invited some friends to have tea break with me. Among them were Churchill Lawi of MAFI and Daniel Ranggu of SPU (JKR). I remembered Churchill asked me of my immediate reaction about the bad Financial situation that Malaysia was facing at that time, and my off the cup reaction was: Mahathir should replace Anwar as Minister of Finance and we must close down KLSE. On my way home, that late afternoon, I switched on the car radio to listen to the news. Wednesday, 2 September, 1998, the very day, the same day, Anwar was not only removed as Minister of Finance, but as well stripped from the Deputy Prime Minister post.

(6) Last night, on my return to Kuching, though felt real tired, after having as early as 0730 hour Breakfast Business Discussion and later chairing three meetings, two books: Notes To The Prime Minsietr: The untold story of how Malaysia beat the currency speculators by Wong Sulong and The Art Of Islamic Banking and Finance: Tools and Techiques for Community-based Banking by Yahia Abdul Rahman made me stay alive in the 90 minutes flight.

(7) Both books, answered all this while my hatred to Anwar act of betraying the fundamental of the Islamic Financial and Economic System ie Interest Free System. Yahia seem to confirm what Mahathir did in his difficult salvage operation to defense the Country from the Currency Speculators. The books were about, getting rid and or mitigating of the excessive High Interest Rate and Speculative Money and Commodities Market.

Quote of Yahia book: We also did something very bold in 2000. After the crisis in Southeast Asia, Malaysia, under the leadership of Dr, Mahathir Muhammad, was the only country in the region that weathered the storm and was able to contain the problem without sacrificing its foreign currency reserves or resorting to heavy borrowing from the IMF. The Board of LARIBA decided to create a new award called the Life Time Achievement Award, and we gave it to then Prime Minister of Malaysia Dr. Mahathir Muhammad....

(8) Yahia, a migrant Egyptian started his business with merely U$200,000 in the 1987, and now managed to raise to U$400,000,000.00 to help the Muslim business and entrepreneurs in the USA through his LARIBA ie Free Interest Banking facilities. While Mahathir with the existence of few strong GLCs, managed to curtail the worst effect of the 1997 Asian Financial crisis.

(9) The two books worth to read and they give us the wisdom on how to manage our resources and future based on the Free Interest concept. It is also great to note, especially for those who are leading the GLCs, we need to be very mindful of the possible serious bad effect of greed for quick return which is the practice of the current corporate system, hidden under the pretext of merger, acquisition, dispose, revaluation, etc. Building the fundamental economic system of the societies should be of our out most interest.

(10) To Najib, I see no reason why our Islamic Banking System is imposing real HIGH interest rate to the borrowers. If the Economic of Scale is the main issues, why not made it compulsory for all Government transaction be dealt along the real Free Interest Spirit. Let ask ourselves, why the rate for Zakat has been fixed by Allah at 2.50%? Government Servant Housing, Vehicles, and Study Loans for instance should be the target for the implementation of such system. Accordingly, provision of affordable Housing Scheme for all works of life in this country should also be based along the same line. In short, let really work hard on the issue of the Economic of Scale of the Islamic Banking System in Malaysia through whatever mean with our certain control.

(11) When I was leading the Sarawak State GLC, I did many times requested my Finance and HR Department to look into all the possibility to adopt an Islamic way of providing firstly the housing for the staff. My thinking was very simple, the Organization bought or build the houses for the staff with fully furnish to their need, then the staff just pay the mortgage value on up scaling basis ie increasing over the years in accordance to their Income Growth. Meaning, they pay less initially and higher as their Income is larger. Accordingly the interest rate charge on their mortgage must be low, as low as possible BUT with condition they must Perform to the KPIs and Organization Norms failing which, their facilities be reviewed. Unfortunately, I believe, as I was not quiet equitant with the Islamic Finance and rushing to many thing, the idea was not then well developed. But I believe it can work and would help the Rakyat if implemented at the National level. I'm happy to hear the Selangor State Government (March., 2014) is looking into implementing interest free housing for the Rakyat.

(12) To me, I hope the Malayisan Islamic Banking System should take a fresh look at how we should manage the business risk. I believe, we had been too much influenced by the Zionist Capitalist System, thus we seem to have a Mind Blocked on how to manage risk. Thus, HIGH rate of interest still being the chosen paradigm, yet we called our system, Islamic!

Kuching, Sarawak
29 June, 2011