Embrace China, says Najib; US not restricting China & to keep military prence in Asia: Gates

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Embrace China, says Najib

By NELSON BENJAMIN nelson@thestar.com.my

SINGAPORE: China should be engaged in a positive and constructive manner and not seen as an adversary, Prime Minister Datuk Seri Najib Tun Razak said.

He said Malaysia was fully convinced that the rise of China would be a benign influence in the region. “We do not feel threatened by China.

Guiding hand: US Secretary of Defence Robert Gates gesturing as he meets Najib on the sidelines of the Shangri-La Dialogue yesterday. — Reuters

 

 

“It will be a mistake to see China as an adversary and if we treat China in a positive and constructive manner, they will also respond to us positively.

“I can tell you that the Chinese have a good memory and if you do them a good deed, they will remember for a long time,” he said at the 10th International Institute for Strategic Studies Shangri-La Dialogue here yesterday.

Citing an example, Najib said Malaysia was the first South-East Asian country to establish diplomatic ties with China during his late father Tun Abdul Razak Hussein’s tenure and until today, it was still being talked about in the country.

“I am optimistic that besides China, we can also develop a meaningful and constructive relationship with India,” he said, adding that trade with these two countries had been on the rise.

“In Asean we do not have to make a choice.

“We do not want to go back to a Cold War mentality and we look forward to engagements and relationships not just with India and China but others, including the United States,” he added.

On the build-up of conventional arms in the region especially involving navies, Najib downplayed it as a modernisation effort saying that this was part of efforts by countries as their economies got stronger and wealthier.

He said there would be more to lose if countries were engaged in conflicts while there was more to gain if everyone continued to engage constructively.

Earlier in his speech, Najib reiterated Malaysia’s role as a responsible global citizen with actions to help ensure global peace and stability.

“We will continue to play our part and show that our commitment is not merely rhetorical but is backed up by action,” he said, touching on the peacekeeping efforts by Malaysian soldiers, the deployment of female doctors to Afghanistan, Malaysia’s fight against terrorism and the intermediary role it played in southern Philippines.

He also touched on Malaysia’s readiness to be deployed to Bahrain to play a role if invited by the people there.

He also added that there was a new set of asymmetric and non-traditional security challenges involving human trafficking, drug smuggling and nuclear proliferation.
Najib also called for border disputes among regional countries to be resolved in the spirit of mutual respect and cooperation.

Also at the event, Najib outlined six strategies to maintain peace and stability in the region and called for the setting up of a new Rapid Response Team with the ability to respond to disasters.
“The way forward is through dialogue, engagement and consensus,” he added.

Gates: US not restricting China 

By Li Xiaokun (China Daily)

SINGAPORE / BEIJING - Outgoing US Defense Secretary Robert Gates said on Thursday that the United States was not trying to "hold China down" and doubts that Beijing aims to match Washington's military power. 

"We are not trying to hold China down. China has been a great power for thousands of years. It is a global power and will be a global power," he said. 

Gates was speaking en route to the annual Shangri-La Dialogue, Asia's most prominent security conference, scheduled for June 3 to 5 in Singapore, where he is scheduled to meet his Chinese counterpart Liang Guanglie on the sidelines of the meeting. 

Liang is the most senior Chinese official to attend the security conference. 

Gates added: "The Chinese have learned a powerful lesson from the Soviet experience, and they do not intend to try and compete with us across the full range of military capabilities." 

He was alluding to the ultimately fatal economic burden that the Soviets assumed in trying to keep up with Washington in the Cold War arms race. 

Gates said he is very satisfied with the progress of Washington's relationship with Beijing, but sees room for improvement between the two militaries. 

"Under those circumstances, there is value in a continuing dialogue by the two sides of just exactly what our concerns are, what our issues are and how we might alleviate the concerns on both sides," he said. 

Gates added that Washington will continue to build relationships with its allies in Asia despite potential budget restrictions and that Washington plans to remain a reliable partner in the region. 

"I would say, if anything, these pressures put a premium on multilateral responses to problems," he said. "Whether it's humanitarian assistance or disaster relief, we see opportunities with a number of countries out here, including China." 

It is Gates' seventh trip to Asia in the past 18 months and his final overseas trip before he retires on June 30. US President Barack Obama has named CIA Director Leon Panetta to replace him. 

Gates also said the reshaping of much of Obama's national security team - including the selection of Gates' own successor and the controversial search for a new chairman of the Joint Chiefs of Staff - was at least a year in the making. 

In his first extended comments on the process, Gates said the key consideration was preserving what he called a sense of teamwork among the top national security aides as the administration winds down the US military role in Iraq and fashions a plan for turning over security responsibilities in Afghanistan by 2014. 

Obama announced on Monday that he would nominate General Martin Dempsey, who had just taken over on April 11 as army chief of staff. Gates said he would not discuss publicly his own recommendation to Obama for the joint chiefs selection. 

Li Qinggong, deputy secretary-general of the China Council for National Security Policy Studies, said Gates is likely to make full use of his last overseas visit as defense secretary to meet Chinese military leaders and give another push to military ties between Washington and Beijing. 

"Gates, unlike his predecessor, has always been positive on improving military ties with China," Li said.
Although he might talk about a Chinese military "buildup" and "threats", the underlying theme of his speech and his meeting with Liang will be positive, Li added.
As for the change of US defense leaders, Li said it is unlikely to impact the improving ties between the two militaries. 

"US leaders, including Obama, Hillary Clinton and the new military leaders all know that military ties with Beijing have become more and more important for overall ties," he said. 

However, potential disputes still linger on regional hotspots, such as Taiwan, the South China Sea and US exercises in Northeast Asia, said Li. 

AP, AFP contributed to this story.  Newscribe : get free news in real time 

US to keep military presence in Asia: Gates 

By Ma Liyao and Zhou Wa (China Daily)

Neighbors appreciate China's efforts in maintaining regional security

Chinese Defense Minister Liang Guanglie (right) shakes hands with former US defense secretary William Cohen at the Asia-Pacific security forum in Singapore on Saturday. [Photo/Agencies]

Singapore / Beijing - Despite its fiscal troubles, the US will maintain a "robust" military presence across Asia, backed up by new high-tech weaponry, US Defense Secretary Robert Gates said.

Gates made the remark during a speech on the second day of the Shangri-La Dialogue, hosted by the International Institute for Strategic Studies in Singapore. 

The US military will expand its presence by sharing facilities with Australia in the Indian Ocean and deploying new littoral combat ships in Singapore, where it has regular access to naval facilities, he said.

"Gates' comments were made as assurance to the allies of the US in the region that its policies will continue after his impending retirement," said Major General Luo Yuan, a senior researcher with the Academy of Military Sciences.

Gates will step down by the end of June, and the current director of the CIA, Leon Panetta, has been nominated to replace him.

Worries about the ability of the US to maintain its military presence have been raised as President Barack Obama faces mounting political pressure to deal with Washington's $1.4 trillion budget deficit and more than $14 trillion in debt. 

Gates said that he would take a $100 bet that "in five years, the US influence in this region will be as strong, if not stronger than now". 

The US remains as the dominant power in the Asia-Pacific region, and its influence over the region will continue in the next five years, said Yuan Peng, director of the American Studies Center at China Institutes of Contemporary International Relations in Beijing.

In his speech, Gates also said the key to solving the maritime issues in the Southeast Asia is to provide a "peaceful mechanism" that will not intensify tensions. 

"We should not lose any time before strengthening these mechanisms of dealing with the claims. Clashes serve nobody's interests," he said in answer to questions about the South China Sea issues.

China's stance on these issues remains that they should be solved bilaterally, between China and other coastal countries. 

Confidence is needed that the parties concerned can solve the problems themselves through a peaceful bilateral mechanism.

The regional disputes should be solved by countries in this region, Luo said, adding that a third party, who is not familiar with the history and culture in the region and has a different mode of thinking, can make things more complicated .

During meetings with Chinese Defense Minister Liang Guanglie on the sidelines of the Shangri-La Dialogue, China's neighbors voiced appreciation on Saturday for Beijing's efforts toward regional security and international assistance.

Kim Kwan-jin, defense minister of the Republic of Korea, appreciated China's work at maintaining stability and peace on the Korean Peninsula and thanked China for its help in protecting South Korean merchant ships in waters off Somalia from pirate attacks in February.

Japanese Defense Minister Toshimi Kitazawa and Wayne Mapp, defense minister of New Zealand, thanked China for its rapid aid to their countries when they were struck by major earthquakes this year.

Liang also met with Russian Deputy Prime Minister Sergei Ivanov, who is in charge of the country's national defense affairs and military industries. 

Gates called for all countries to recognize the potential problems caused by cyber attacks, saying that the US defense system is under attack "all the time".

The Pentagon is working to identify hackers, who will be responded to in kind or with traditional offensive action, Gates said. "We take the cyber threat very seriously and we see it from a variety of sources, not just one or another country," he said. 

"China is one of the biggest targets of cyber attacks," said Luo, adding that China always tries to work with other countries to fight against such attacks. 

AFP contributed to this story.

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US dollar cracking at the seams

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WHAT ARE WE TO DO By TAN SRI LIN SEE-YAN

MY last columns dealt with the international monetary system (IMS), specifically why the world monetary order is in disorder, and why free movement of capital underpinning the IMS is increasingly being challenged.

Today's column concerns the basic anchor of the IMS the reserve currency role of the US dollar and why it will give way to rapidly rising pressures towards multipolarity, that is, the concurrent pulling of forces emanating from more than two growth centres.

In 20 years, the World Bank expects the newly emerging BRIIKs (Brazil, Russia, India, Indonesia and Korea) to join China as new drivers of growth towards a multipolar world. Today, none of their currencies is used for reserve accumulation, invoicing or exchange rate anchor. The status quo remains centred on the US dollar. But change is in the air.

In 1991, the G3 (US, euro-zone and Japan) accounted for 49% of world trade, and the BRIICKs (BRIIKs plus China) only 9%. By 2010, the G3's share had fallen to 29%, while the BRIICKs' share rose beyond 30%. Without doubt, the post-war structure dominated by advanced nations is in the midst of fundamental change. Globalisation and the rapid growth of the emerging market economies (EMEs) are bound to translate into greater global economic power. It's just a matter of time.

Multipolarity

We are witnessing the cracking of the global institutions created in 1945. They are still unadjusted to the growing weight of the EMEs, reflecting reluctance by the United States and euro-zone to come to terms with a world they no longer dominate. It is also a manifestation of uneasiness in China, India and Brazil that the management of their domestic economy, long the jurisdiction of internal prerogative, now matters to the rest of the world.

This is understandable. The founding of the Bretton Woods institutions (IMF and World Bank) after the devastation of the Great Depression and WWII set in motion an era of stability at a time when the US was unchallenged in the global economy. In international finance, this post-war order began to fall apart in the 1970s as the US economy floundered, the dollar tanked, Europe was rebuilt and Japan asserted itself.

The move towards multipolarism was, however, interrupted in the 1980s and 1990s by the Soviet Union's collapse, the euro-zone's indigestion after swallowing a re-united Germany, and the Asian currency crisis. The US was thrust into the forefront to lead. But, the home-made US financial crisis in the 2000s in the face of rapidly rising EMEs, brought the era of US dominance to an end.

Yet, neither the US, euro-zone nor China has the capacity and clout to manage global problems. Happily, the G-20 came along to replace the G7, stumbling on to a mutually beneficial co-operation. Prof Barry Eichengreen's reference in history of another scenario is scary: “The decades following WWI were marked by the inability of rising or declining powers to stabilise the world economy or create functioning global institutions; the result was the Great Depression & WWII.”

A definite shift is taking place, driven by the rising power of the emerging BRIICKs, together representing more than one-half of global growth in 14 years. According to the World Bank report, Multipolarity: The New Global Economy, the EMEs will grow at 4.7% per annum up until 2025, which is double the rate of the advanced nations (2.3%). The implications are far-reaching:

• the balance of global growth and investment will shift to the EMEs;

• this shift will lead to boosts in investment flows to nations driving global growth, with a significant rise in cross-border M&As, and a changing corporate landscape where established multinationals will largely be absent;

•  a new IMS will gradually evolve, displacing the US$ as the world's main reserve currency by 2025;

•  the euro and the RMB (renmimbi, China's currency) will establish themselves on an equal footing in a new “multi-currency” monetary system;

• the euro is the most credible rival to the US$; “its status is poised to expand provided the euro can successfully overcome sovereign debt crisis currently faced by some member countries and can avoid moral hazard problems associated with bailouts within the European Union;”

•  the rising role (and internationalising) of the RMB should “resolve the disparity between China's growing economic strength on the global stage and its heavy reliance on foreign currencies;” and

• the transition will happen gradually.

At no time in modern history have so many EMEs been at the forefront of an evolving multipolar economic system.



A strong US dollar a delusion

The US dollar is the reserve currency. This refers to its use by foreign central banks and governments as part of their international reserves. This role, combined with its widespread use as a medium of exchange (transactions and settlement vehicle), a standard of measurement (unit of account) and a store of value (method of holding wealth), has given rise to the key currency status of the US dollar. For these reasons, the US serves as world banker.

This was not planned. It just evolved since it met various needs of foreign official institutions and foreign private parties more effectively than any alternative could. Many of the reasons for the use of US dollar by official and private parties are the same. However, the aims of the two users need not always coincide. If the US dollar's role as reserve currency was terminated, its use by private traders and institutions would most likely remain, perhaps even stronger. The wheels of commerce keep turning. The role of the US dollar as world banker remains relevant.

It is a long-standing tradition for the US Treasury to favour a strong US dollar. The US Fed has no say since it is outside its purview of fighting inflation and unemployment.

The exchange rate is just another price. The price of the US dollar relative to other currencies is determined in the market, and not under the control of anyone. An increase in demand for US dollar or a reduction in its supply strengthens the US dollar. Lower demand and increased supply will weaken the US dollar.

A strong US dollar is not always good. It depends on what causes it to strengthen; if the cause is rising productivity or innovation, that's good. But in an economy struggling to grow and to create more jobs, a strong US dollar is not so desirable. A weak dollar means goods are cheaper relative to foreign goods; it stimulates exports and reduces imports. Foreign goods get more expansive but more US jobs are created.

At this time, US is better off with a weak dollar. Strangely, most politicians thinks it's desirable for the US dollar to weaken only against one currency, the renminbi. The US Congress routinely bashes China for not weakening the US dollar enough. Indeed, a fall in the value of the US dollar against all currencies would help the US even more. Yet, in the next breath, the same Congress wants the US dollar to be strong. This delusion just won't go away. They are like failed dieters who talk earnestly about healthy living while eating a chocolate doughnut.

The US dollar isn't going anywhere. It is not about to be replaced anytime soon. The only dangers are (i) reckless US mismanagement giving rise to chronic inflation (or deflation if the exit of QE2, the second round of quantitative easing, is not well handled), which is implausible; and (ii) US budget deficits run out of control; outright debt default is far-fetched. Mark Twain once responded to accounts of his ill health by saying “reports of my death are greatly exaggerated”. He might well have referred to the US dollar. For the moment, the patient is stable, external symptoms notwithstanding. But there will be grounds for worry if he doesn't commit to a healthier lifestyle.

The euro and renminbi

Today, the US dollar faces growing competition in the global currency space. The serious contender is the euro, which has gained ground as a currency goods are invoiced and as official reserves held. Nevertheless, share of reserves held in US dollar remains well over double the share held in euros; US$ share did fall from 71% in 2000 to 67% in 2005 and 62% in 2009, while euro's share rose from 24% in 2005 to more than 27% in 2009. In terms of global forex, the US$ market turns over US$3.5 trillion daily, more than double that in euros. But the US dollar share of the market fell from 45% in 2001 to 42% in 2010. Euro capital markets are of comparable depth and liquidity as the US dollar's, and the euro-zone and US economies are roughly the same size.

Events since 2008 have shaken faith in the US financial markets. But the banking crisis and its economic fallout are a trans-Atlantic affair. Continuing euro bailouts is a sign the old continent is not much safer than the US. Worried savers may still sleep better with US$ under their pillow. So for the euro, it's going to be a long haul.

The sheer dynamism of China and the globalisation of its corporations and banks will propel the renminbi to a greater international role. It can become a global settlement currency this year. China has made good progress, signing currency swaps with more central banks. The issuance of renminbi-denominated bonds is actively promoted. Renminbi offshore deposits in Hong Kong (to top 1 trillion renminbi by year-end) are rising rapidly, and offshore renminbi trading will expand beyond Hong Kong.

But with the undervalued exchange rate, an asymmetry in settlement has arisen. Foreign importers are reluctant to settle in renminbi, while foreign exporters are glad to do so. In the end, success at internationalising the renminbi depends on the pace China liberalises the capital account.

The problem lies in speculative capital flows aimed at profiting from arbitrage. Capital controls remain as China's last line of defence against hot' money inflows. Its policy continues to encourage non-residents to hold more renminbi and renminbi-denominated assets. The sequencing of policy adjustments remains critical as China moves forward. The road ahead is going to be bumpy.

Policies co-ordination

By 2025, the World Bank's best bet is the emergence of a multipolar world centered around the US dollar, euro and renminbi. A world supported by the likelihood US, euro-zone & China will constitute the three major “growth poles” by then. They would provide stimulus to other nations through expanding trade, finance and technology transfers, which in turn creates international demand for their currencies. Already, private investment inflows into EMEs are expected at US$1.04 trillion this year (mainly to China) against US$990bil in 2010 and US$640bil in 2009.

Inherent in this shift is rising competition among them, which is real. This is bound to create situations of potential conflict, which can exact a heavy toll on global financial markets and growth. This calls for workable mechanisms to strengthen policy co-ordination across the major growth poles in particular. This is critical in reducing risks of political and economic instability.

In the recent crisis, the G-20 was able to pick low-hanging fruits by managing the re-alignment of macro-economic policies aimed at generally common objectives to get out of recession and to rebuild financial systems. In today's world, shifts in policy co-ordination will be increasingly towards more politically sensitive domestic fiscal and monetary and exchange rate policies. Also, the interests of the least developed countries (LDCs) have to be safeguarded against pressures accompanying the transition to a multipolar order.

Against the backdrop of the tragic earthquakes and tsunami that hit Japan, the political turmoil of the Arab spring' gripping much of Middle East and North Africa (MENA), and growing uncertainties emanating from euro-zone sovereign debt crisis, global growth remains at sub-par this year with high unemployment, and rising inflation in the EMEs and LDCs. This calls for building confidence and promoting investments to boost productivity and create jobs to absorb the large pool of youth in MENA in particular. The LDCs and MENA nations are heavily dependent on external demand for growth. Aid and technical assistance have the ability to cushion adjustments as they adapt in the transition process.

According to the World Bank: “It is also critical that major developed economies and EMEs simultaneously craft policies that are mindful of the growing interdependency associated with the increasing presence of developing economies on the global stage and leverage such interdependency to derive closer international cooperation and prosperity worldwide.”

A former banker, Dr Lin is a Harvard-educated economist and a British Chartered Scientist who now spends time writing, teaching and promoting the public interest. Feedback is most welcome at starbiz@thestar.com.my

The untold story of Malaysia foreign exchange controls

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Book reveals how Malaysia beat currency speculators in 1997/98 crisis
By Thean Lee Cheng, Starbiz

 
Nor Mohamed (left) and Wong at the book launch

KUALA LUMPUR: Former Prime Minister Tun Dr Mahathir Mohamad toyed with the idea of exchange controls as early as May 1998 but was met with resistance from within the National Economic Advisory Council, the Cabinet and the central bank.

This was revealed in Notes to the Prime Minister, a new book that chronicles one of the biggest challenges and triumphs in Dr Mahathir's 22 years as Malaysia's Prime Minister.

Notes to the Prime Minister: The Untold Story of How Malaysia Beat the Currency Speculators was launched yesterday in Kuala Lumpur by Minister in the Prime Minister's Department Tan Sri Nor Mohamed Yakcop. Tun Dr Mahathir was not present as he was advised by doctors to rest at home.

The book, published by MPH Publishing, is based on 45 sets of notes written between Oct 3, 1997 and Aug 21, 1998 by Nor Mohamed when he became Dr Mahathir's unofficial and unpaid economic adviser.

The Asian financial crisis, which first engulfed Thailand in the middle of 1997, hit Malaysia soon after. Selective capital controls were imposed on Sept 1.

The book is written by veteran journalist Datuk Wong Sulong, the former business editor and group chief editor of The Star.

In an excerpt from the book, Dr Mahathir told Wong that he decided on foreign exchange controls “after Nor Mohamed explained to me how currency trading works ... millions and millions of ringgit can be transferred from a domestic account to a foreign account by a stroke of a pen ... I realised that foreign currency trading can be stopped by stopping this balance transfer.



“But I must say it was not as easy as that. We needed to do a lot of background work and monitoring and Bank Negara (needed to) set up many committees to do that to ensure that the controls were effectively implemented. (Tan Sri) Dr Zeti (Akhtar Aziz, then deputy governor of Bank Negara) did a lot in that respect and also in the economic recovery.”

Notes to the Prime Minister is not only a valuable lesson on how Malaysia took unorthodox steps to solve the Asian financial crisis but it is also a story of how two Malaysians met halfway around the world and came up with the Malaysian solution to the Asian financial crisis.

It is an intriguing story of how Nor Mohamed, then chief executive officer of Mun Loong Bhd, was summoned by Dr Mahathir to meet him in Buenos Aires, Argentina, on Oct 2, 1997. The first set of those notes was written a day later, on Oct 3.

Prior to this unique flow of notes, Nor Mohamed was a Bank Negara adviser.

His expertise in foreign exchange landed him and then Bank Negara governor Tan Sri Jaafar Hussein in trouble. Both of them resigned to take responsibility for Bank Negara's speculation on foreign exchange losses that went into billions of ringgit in the early 1990s. Nor Mohamed joined the private sector after that.

Said Nor Mohamed at the launch: “We learn in history that sometimes the lives of individuals and the fate of nations hinge on a millimetre's difference in the trajectory of a bullet, a road not taken on a whim, or the random stray of a shrapnel.

“In my case, my fate was sealed ... by the turn of a head Tun Dr Mahathir's ... It was a sunny afternoon in September 1997, when the PM's motorcade was speeding along the streets of Kuala Lumpur.

“At one junction, as the motorcade slowed, Tun Dr Mahathir turned his head to look out. And he saw a forlorn-looking man walking towards a row of shops for lunch. That forlorn-looking man was me!”

Nor Mohamed was summoned a few days later to go to Argentina. In April 1998, Nor Mohamed resigned from Mun Loong to concentrate on being Dr Mahathir's unofficial adviser.

During that period of assessement, Nor Mohamed went to Singapore to observe the operations of Central Limit Order Book (CLOB), a board on the Singapore Stock Exchange which dealt with a great number of Malaysian shares. Dr Mahathir felt that Malaysia's currency crisis could not be solved as long as CLOB exists.

Dr Mahathir, aware that his adviser was unemployed, asked: “Do you have money to go down to Singapore?” Nor Mohamed laughed and assured him that the trip would not cost a lot of money. The rest, as they say, is history.

As for Wong, who shares a deep liking for Nor Mohamed, he was asked by his friend to write the book.

“I felt a sense of excitement and a heavy responsibility. These notes had never seen daylight and it shed a new light (on more than just the economic and political aspects of this country). You have to tell a story as honestly as possibile, but not technically, because it has to appeal to the average reader. So that was my dual challenge.”

Related post:

Capital controls: From heresy to orthodoxy  

Malaysians first, Time to stop thinking along racial lines, says Soi Lek!

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Time to stop thinking along racial lines, says Soi Lek

KUALA LUMPUR: The people must start thinking of themselves as Malaysians first rather than the racial group they belong to, said MCA president Datuk Seri Dr Chua Soi Lek.

He said Malaysians had to accept the political reality that the country was a multiracial one and everyone must work together to make it a peaceful and developed place.

“At MCA, we have always asked for the column stating race to be removed from application forms,” he told reporters after the ground-breaking ceremony of the Selangor and Kuala Lumpur Chin Woo Association multi-purpose activity centre here yesterday.



However, Dr Chua acknowledged that it would not be easy to achieve the 1Malaysia objective right now as the people still had very strong racial identity and feelings.

He said Malaysians, from government servants to businessmen, were still thinking along racial lines.

On whether Barisan Nasional component parties that represent the major races in the country are hindrances to achieving the 1Malaysia concept, Dr Chua said they should not be.

“We have been in existence for so long. When we solve problems, we do not talk about race,” he said.

He said even Pakatan Rakyat was a coalition of parties that represented the major races in the country.

“PAS is basically (made up) of Malays and Parti Keadilan Rakyat is (made up of) people (who were previously) from Umno while DAP comprises mostly Chinese,” he said.



On another matter, Dr Chua said more young faces with high chances of winning will be chosen to be MCA candidates in the next general election.

He said young candidates who were media-savvy and had passion and good organisational and language skills would form a good combination with their older counterparts.

“The best combination will be to have the old, middle-aged and the young ones as our candidates,” he said.

He said MCA had always tried to infuse new blood into the party, so those who had been holding party positions should not assume that they would automatically be selected to be election candidates.

“We will also not pick candidates based on their gender or the faction they belong to,” he said.

Recently, Dr Chua hinted that leaders, especially division chairmen who had lost in the previous general election, would not be chosen as candidates in the next general election.

On whether this would backfire and cause acts of sabotage among party members, Dr Chua said: “If a candidate has a high chance of winning, he or she should not be worried.”

He said when MCA made the decision to not take up any government posts should it perform poorly in the next general election, it was a warning to incumbent leaders not to be complacent but to work hard to get the support of voters.

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Errant lawyers ticked off

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By M. MAGESWARI mages@thestar.com.my

KUALA LUMPUR: Seven lawyers were reprimanded by the Advocates and Solicitors Disciplinary Board in the first five months of this year following six complaints against them for unbefitting conduct, breach of Legal Profession Act Rules and negligence in handling their cases.

Board chairman Tan Sri Khalid Ahmad Sulaiman told The Star that the disciplinary board only reprimanded the lawyers after finding that they had no intention of cheating their clients or misleading the courts.

“We have even reprimanded senior lawyers for overlooking certain things. “Lawyers must be professional and their client’s interest is paramount to them,” he said.

Khalid said one of the reasons lawyers were reprimanded was failing to respond to the Bar Council and their client’s letters.

“They were reprimanded for unbecoming conduct as advocates and solicitors. “Lawyers who do not attend court proceedings will also be reprimanded,” he added.



Khalid said the board had ticked off senior lawyers for leaving their legal advisers or clerks to deal with certain matters.

“I have told them to keep an eye on their legal advisers and clerks. We told them to be careful next time and not let this happen again.”

He said the board warned the lawyers that they would face severe punishment, including suspension.
Khalid hoped the lawyers, mostly first-time offenders, would not repeat their mistakes.

He said those reprimanded were among the more than 500 lawyers who were investigated by the board after complaints were lodged against them between January and May.

The Star had published an exclusive report yesterday stating that the board had received 538 complaints against lawyers, mostly in Selangor, Kuala Lumpur and Johor Baru, in the first five months of the year.

Five were barred from practising, 28 including four Datuks were fined between RM1,000 and RM30,000, while investigations into the other cases are ongoing.

The board receives an average of 900 complaints a year, including criminal breach of trust and breach of solicitor’s ethics.

Former Malaysian Bar president Ragunath Kesavan said complaints against lawyers, mostly for dishonesty involving client’s money, had been forwarded to the board.

“Any (wrongful) transaction involving the client’s accounts is a serious offence. We have lodged complaints against lawyers for dishonesty involving amounts ranging between RM20,000 and RM2mil,” he said.

He added that the board had found the lawyers guilty after investigating the complaints.

Ragunath said the Bar had confidence in the disciplinary proceedings by the board as it was independent.
“It is very important to have public confidence in the legal profession.”

He said the Bar forwarded complaints of dishonesty without any hesitation, although only a small percentage of lawyers were involved in such cases.