Chinese, and truly Malaysian?

By HARIATI AZIZAN sunday@thestar.com.my

A new book attempts to shed new light on the Malaysian Chinese community.

XINNIAN kuaile; Sin-ni khoai-lok; or Sun nin fai lok: there are more than eight Chinese dialects and languages to pick from when wishing Happy New Year to our fellow Malaysians.

Then we have the choice of ang pow, laisee or hung-bao, among others, to give out as gifts to children.

Most Malaysians, however, are not aware of this as the Chinese community is often seen as one homogenous community.

Different but the same: Although the Chinese-educated speak and read mainly in Chinese, they have no problem forging relationships with other rac es. — A. MALEX YAHAYA

Rita Sim, co-founder and fellow of the think tank Centre for Strategic Engagement (Cense), says this is perhaps the biggest myth about the Chinese community in Malaysia.

“Even for those who are aware that there are various dialects and languages among the Chinese, many still think that the Malaysian Chinese community is homogenous,” she says.

This is one of the misconceptions that Sim hopes to address in her book Unmistakably Chinese, Genuinely Malaysian.

The idea for the book, she relates, was conceived when she was doing marketing for the local Chinese daily Sin Chew.

“Media planners and advertisers in Malaysia are largely English speakers, so many do not realise how big and diverse the Chinese community in this country is,” she says.

In her book, Sim divides the Chinese community into three clusters, G1, G2 and G3, which in loose terms can be defined as “Chinese literate”, “non-Chinese literate” and the “Overlap” respectively.

Three clusters: In her book, Sim divides the Chinese community into G1, G2 and G3, which in loose terms can be defined as ‘Chinese literate’, ‘non-Chinese literate’ and the ‘Overlap’ respectively

 

“This is only to give it a vocabulary. Actually, this is common knowledge among the Chinese speakers and readers, but it is new for the others,” she tells Sunday Star, adding that the terminology was first mooted by social observers and influencers of Chinese communal development.

The first cluster, G1, is the largest and forms 85% of the 6.5 million Chinese in Malaysia. “They are guided by Chinese philosophy and are immersed in Chinese language and culture,” Sim says.

This cluster is growing as more than 95% of Chinese parents are now opting to send their children to Chinese schools.

“Over 90% of the Chinese in Malaysia now are Chinese speakers,” she highlights.

The second, a considerably smaller group at between 10% and 15% of the community, is more cosmopolitan. They are likely to have a large network of close friends from other communities and are influenced more by Western-style learning.



Between these two groups is an overlap the G3, which consists of G1 or G2 Chinese who, through language or work exposure, have stepped into the other grouping and survived, even thrived.

Sim notes that although carving up the community in this manner may seem overly simplistic, “it does support the reality in significant ways.”

Crucially, she adds, the clusters are not fixed.

“They are fluid as the Chinese move in and out of the clusters depending on their education and income level, and they are certainly not like mainland (China) Chinese.”

As Sim points out in her book, the G1 have adopted a socio-cultural framework which rests on three main pillars: Chinese education, Chinese media and Chinese organisations.

The G2 Chinese are not Chinese-educated. They speak English and include a large number of Christians and the Peranakan. They are comfortable reading English or Bahasa Malaysia newspapers and tend to take a Malaysian perspective as opposed to an exclusively Chinese one.

Despite the existence of the G3 category, the two main groups remain quite distinct.

The G2 parent, for example, does not subscribe to the three pillars but for pragmatic reasons, many send their children to Chinese schools to give them a leg-up in the globalised world.

Among the G1 group, Chinese education is inextricably linked to identity and has little to do with globalisation.

Thus, the G1 stands firmly by the Federal Constitution, which allows Chinese and Indian communities the right to mother tongue education, Sim says.

No hindrance to unity

While Chinese schools have been blamed as the cause of disunity in Malaysia by certain sectors, Sim disagrees.

“Today, I don't see Chinese schools as a hindrance to integration because even in Chinese schools you have to learn Bahasa Malaysia. It is a compulsory (subject). And if you go out today, more than 90% of the Chinese in the country are able to communicate in Bahasa, so there is no communication problem.”

Sim strongly believes it is time to acknowledge the role the G1 play in the country's social and economic development.

Proficiency in Chinese is an advantage in the world now, especially if you want to do business in China, she points out.

This is true, and even the BBC has recently reported that Malaysians have an advantage in China because of our multilingual education.

“How many people can speak Mandarin, multiple Chinese dialects, Malay and English?” Lim Cheah Chooi from engineering firm Unimech Group Berhad, which has production factories in China, was quoted by the BBC.

Sim concurs, adding that Malaysians are also able to venture into the Indonesian market because of their fluency in Malay and they can go to the United States and Europe too because of their knowledge of English.

Malaysia is unique in the sense that we have parallel education systems vernacular schools, national schools, and private schools, stresses Sim.

“It is unique as it is only in Malaysia that different streams are allowed to exist, and in such a thriving manner, as part of the mainstream school system,” she says.

“In the whole of South-East Asia, Malaysia is the only country where you can find 1,293 Chinese primary schools, so we have a choice of sending our children to Chinese schools or national schools, then let them continue their secondary education at one of the 61 Chinese independent schools or 78 SMJK (C). And later, they can even finish their tertiary education in Chinese at three local colleges,” she adds, highlighting that the schools are highly in demand even among non-Chinese families.

Instead of politicising the issue, we need to list the qualities of the system and see how we can push it further, she says.

“In the long run, perhaps a review is needed to standardise the national education system have one school system with language classes available but it will need a lot of resources.”

Notably, says Sim, the new G1 generation is very connected to the local community.

“Although some received tertiary education in Taiwan and China, many are very connected to Malaysia.
Many are very aware of the issues in Malaysia and are engaged with Malaysian communities, especially in the urban areas. They feel that this is home and want to make it a better place.”

Although many speak and read mainly in Chinese, they have no problem forging relationships with other races.

Sim had originally targeted her book at advertisers, media planners as well as government agencies to stress the importance of understanding the complexity of the Chinese community for effective communication, but she now believes that it can also benefit the general public.

This is particularly essential in light of the pendatang (immigrant) issue that is now and again flogged by various factions for political gains.

“In any society, you will always have the extremes, the ultras and conservatives, and the way to deal with this is to continuously engage in educating them. That is why the historical aspect is important how Malaysia came about. This needs to be taught in school and for all Malaysians to understand. Hopefully, in time to come, the ultra conservative element can be reduced.”

At the same time, an understanding of the contemporary Malaysian society is also important.

“This is something else that I hope to spur debates on the issue,” she says.

Ultimately, Sim hopes the book can shed some light on the Chinese community and help end the pendatang argument.

“We never deny the fact that we are Chinese through history and in the historical context, but today we are genuinely Malaysian. We are very different from the Chinese who came here in the 18th century,” she stresses.

“Whatever our historical background, we are Malaysian, so we should not question this any longer. That is why I named the book Unmistakably Chinese, Genuinely Malaysian.”

Related articles/post:

• Will China's rise shape Malaysian Chinese community?

  I Recognise You! But How Did I Do It? How local Chinese see faces?

Challenging the State-Capitalism?

Clash of capitalist systems

GLOBAL TRENDS  By MARTIN KHOR

The Year of the Dragon may symbolise the struggle for prosperity for some, but others may use this year to challenge what they call state-capitalism being practised by developing countries, especially in Asia.



IT’S the first day of the Year of the Dragon. Like others around the world, Malaysians hope it will be an auspicious year.

Certainly it will be an interesting one. Perhaps that’s the only certainty about this coming year of uncertainty.

The new Dragon Year will usher in even more intense debate about the role and the rise of China and of other “emerging economies”.

As the Western countries face gloomy economic prospects, some of their political elite and intellectuals seem to be seized by fears that some developing countries, especially China, will be steaming ahead.

Used to centuries of global economic dominance, these advanced countries are fearful that their leadership will be challenged and even overturned.

This may be the reason for the obsession about China. These days, there are new books almost every month about the rise of China. Some deal with its high growth and prospects or with its complex political developments.

Quite a number, like the book Death by China: Confronting the Dragon, are of the view that China is destroying not only the American economy but the whole world and its environment.

But the fears go beyond China, and incorporate other emerging countries as well, as seen in the latest issue of The Economist, with its cover stories on “The rise of state capitalism: the emerging world’s new model.”



The magazine describes the 88-storey Petronas Towers soaring above Kuala Lumpur, as well as the China Central TV building in Beijing and the VTB bank office in Moscow, as monuments to the new hybrid corporation – backed by the state but behaving like private-sector multinationals.

The Economist’s editorial admits that for emerging countries wanting to make their mark on the world, state capitalism has an obvious appeal, giving them the clout that private-sector companies would take years to build.

But its dangers outweigh its advantages, says the magazine. For their own sake and in the interests of world trade, the huge holdings should be unwound and handed over to private investors.

The Economist however also admits that this hybrid form of “state-directed capitalism” company is not new, and cites the East India Company.

This was the huge conglomeration that took over many Asian countries’ economies, while the English government made use of its gunboats and colonial rule to back up the EIC but other British companies.

The magazine also cites the United States after its war of independence, Germany in the 1870s, and Japan and South Korea in the 1950s as examples of rising powers using the state to kick-start growth.

There is thus recognition that the rise of today’s advanced countries was based on the state’s strong support in their companies’ emergence.

These companies have dominated the global economy for decades and in some cases centuries, backed up not only by subsidies, cheap credit and other policy measures but also by their governments’ political and military force.

In the past three decades, most developing countries have been told, through IMF-World Bank structural adjustment programmes, to give up the role of the state to direct their economies and instead rely entirely on the private sector.

These policies did not succeed as the domestic private sector is weak or even non-existent in many countries. In poor countries, foreign companies were not interested in coming in except in the mining or plantation sectors.

However, several other developing countries, mostly in Asia, took on a different model. Their governments believed in playing an important or even dominant role in the development process.

At first these governments owned companies that they ran like government departments, and this was not efficient. This model was changed in some countries to one where the state can own or partly own companies that are then run on a commercial basis. The state can also assist private companies to grow.

Government investment holding institutions like Khazanah and PNB in Malaysia or Temasek in Singapore have been set up as crucial components of this framework.

The increasing criticism by Western intellectuals and politicians of “state capitalism” is not confined to academic observations.

The US administration and Congress are contemplating legislation and action to place extra tariffs on Chinese products not only on anti-dumping grounds but also that they have been subsidised and that China is not a market economy.

The Congress is also discussing whether to slap tariffs on Chinese products on the ground that China’s currency is manipulated and under-valued.

While the focus now may be on China, other developing countries may be faced with the same actions based on the same reasoning, that these countries are unfairly helping their companies through policy measures that represent state-capitalism and industrial policy.

Moreover, the US and Europe and now negotiating free trade agreements with developing countries that contain clauses or even chapters that seek to prohibit or restrict the practices of government-linked companies, or the provision of subsidies and preferences by government to local companies.

Korean economist Ha Joon-chang wrote a famous book Kicking Away the Ladder to describe how developed countries made use of policies that made them rich, and now want to prevent developing countries from doing the same and thus are seeking to prohibit these same policies.

The clash of capitalist systems and the clash between developed and developing countries over what policies are legitimate and which should be banned will intensify in this Year of the Dragon.

Related articles

• The Rise of State Capitalism. (isellerfinance.wordpress.com)

US Military Strategy to Asia: Poke a Stick In China's Eye

A military pivot to Asia

By TANG SIEW MUN

‘Pivoting to Asia’ is fast becoming the centrepiece of US strategic and diplomatic objectives.

IF there were doubts about America’s “return” to Asia, all were dissipated with the release of the new strategic guidance report by the Pentagon on Jan 5.

Washington’s grand objective can be gleaned from the title of the report, “Sustaining US Global Leadership: Priorities for 21st Century Defence”.

While the report affirms US interests worldwide and renews its pledge to uphold its commitments to its allies and friends, it unambiguously stresses the importance of Asia. It states that the US “will of necessity rebalance towards the Asia-Pacific region”.

The report follows through the grand strategic vision enunciated by Secretary of State Hillary Clinton in an article published in Foreign Policy where she declared that “the future of politics will be decided in Asia, not Afghanistan or Iraq, and the United States will be right at the centre of the action”.

“Pivoting to Asia” is fast becoming the centrepiece of US strategic and diplomatic objectives.

Before “pivoting” became the cornerstone of the US-Asia policy, the region was abuzz with the US “return” to Asia. China, understandably, was especially agitated.

Indeed, there are segments in China who view the US “return” to Asia with a sense of foreboding, as US initiatives are seen as stratagems to contain China’s growing influence and power in the region.

If hitherto there were concerns about the US return to Asia, then Washington’s “pivot movement” to Asia will certainly generate more discussion and potentially countervailing measures.

To be sure, “pivoting” is different from “returning”. In general, a US return would be marked by its heightened diplomatic engagement, especially with its newfound interest and support for multilateral initiatives such as the East Asia Summit.

A US “return” to Asia would be largely viewed by South-East Asia as a positive development, especially in an uncertain strategic environment punctuated by China’s expanding economic and military power.

In this regard, the US is seen as a reliable and indispensable power to balance and, if necessary, to check Chinese aggressive designs.

However, pivoting in the context of the Pentagon report may see an increased US military presence in the region.

South-East Asia is no stranger to the US military. Up until November 1991 when the Clark Air Base was returned to the Philippines, the US had maintained a large military footprint in the region.

The US has close relations with its treaty partners Thailand and the Philippines. In November 1990, the US negotiated an arrangement with Singapore that gave it access to and use of facilities in the city state.

Singapore is also home to the US Navy’s Logistics Group Western Pacific that provides logistics support for the US Seventh Fleet.

For many decades, the US had consistently maintained a high strategic profile through bilateral and multilateral military exercises and other military-to-military cooperation.

The hubs-and-spokes system of bilateral security treaties, which includes South Korea, Japan and Australia, has long been regarded as the backbone of the region’s security.

The strategic presence of the US in, and its engagement with, the region is often quoted as one of the primary reasons for South-East Asia’s stability and growth.

The argument goes that the US provided the security umbrella which allowed South-East Asian states to limit their defence outlays.

This argument was certainly valid during the Cold War era when the Asean states were undoubtedly pro-American and cooperated to varying degrees with the US.

In fact, when the US Air Force pulled out of the Clark Air Base, there was a sense of trepidation and the perception that the US was withdrawing from the region.

There was genuine fear about a power vacuum which would “invite” other major powers to supplant the US’ dominant role in regional security.

Fortunately, these fears were unfounded as the expected jostling for primacy in Asia and the feared US retreat did not materialise.

While the US’ diplomatic and political “return” to the region is applauded and welcomed, reception for its “pivot to Asia” may be less enthusiastic.

There are several reasons for such pessimism. Granted that the pivot strategy will be multifaceted and not uni-dimensionally focusing on military power.

However, it is the latter component of the pivot strategy that may prove to be most controversial.
To the extent that pivoting entails an enlarged and more visible military footprint, it will be destabilising and anathema to regional security.

An increased US military profile will generate what academics understand as a “security dilemma” and make China feel uncomfortable, to put it mildly.

A case in point is the recent announcement of the deployment up to 2,500 US Marines on a “rotational” basis in Darwin, Australia.

Washington and Canberra were quick to emphasise the transient nature of the deployment, but whichever way one attempts to slice and dice “Darwin”, in the eyes of the Chinese and the rest of South-East Asia, this move puts hundreds of well-trained and highly mobile US military personnel at the edge of the region.

It is a potential “beach head” for the US to organise and launch military expeditions into South-East Asia and the Indian Ocean.

We can also expect to see more of the Stars and Stripes in the region.

Last month, Chief of Naval Operations Admiral Jonathan Greenert wrote in the US Naval Institute’s Proceedings that the US is contemplating deploying littoral combat ships in Singapore and “other places” in South-East Asia.



We must ask ourselves whether there is an imminent threat in the region that necessitates increased fire power from the US.

There is a point beyond which an increased military presence provides a negative marginal return. More is not always necessarily better.

There may be quarters in South-East Asia that embrace a larger US military role and profile. Notable among these are the “hedgers” who no doubt see the US as the ultimate “insurance policy” to guard against strategic uncertainty.

When it is diplomatically untenable and militarily impractical to balance against China’s expanding military might, then the growing presence of the US is reassuring, to say the least.

It cannot be denied that the People’s Liberation Army’s (PLA) growing muscle is being closely monitored and analysed.

While there is no unified response to this phenomenon, it is accepted that South-East Asia cannot match the PLA gun for gun.

A military response is destructive and ultimately futile. The preferred modality is to embed China in a web of regional and multilateral cooperation mechanisms.

The Asean China Free Trade Area (ACFTA) and the Asean Plus Three (APT) are but two examples.

South-East Asia should stay the course and continue its ongoing successful engagement of China. However, the military component of “pivoting” may serve to amplify the strategic divide and suspicions between China and South-East Asia.

The implications of “pivoting” are multiple. For a start, the US will seek a larger voice and role in the region.

Secretary Clinton spoke for many Ameri­cans when she asserted that Asia is the future and correspondingly the US must be in Asia.

The substantive question that needs to be asked is, “When the US leads, should Asia fall in line and accept US leadership?”

It would be unrealistic for Washington to assume that Asia will do this. Acceptance of US leadership is not universal, nor is it automatic.

Support for the US in Indonesia, South-East Asia’s largest country, is slipping. The Pew Global Attitudes Survey showed it has declined from 56% in 2009 to 49% in 2010.

Asia does not dance to the tune of Washing­ton, nor does it march to the beat of the Chinese.

While Washington sees its future in Asia, it needs to be mindful that the success of its “pivot” strategy is contingent on the concurrence and support of Asia.

The operative words are cooperation and collaboration.

The region’s strategic uncertainty – read as fear of China – cannot be resolved by the placement of more US troops in the region or through military grandstanding.

It is not about being pro-US or anti-China but how to build a stable, secure and prosperous future. The US pivot to Asia should be welcomed to the extent that it contributes constructively to a better and brighter future for Asia.

> The writer is Director (Foreign Policy and Security Studies) at the Institute of Strategic and International Studies (ISIS) Malaysia. The views are his own.

Obama's New Defense Strategy: Poke a Stick In China's Eye And See What Happens 

This new "Defense Strategy" of President Obama's is a deliberate provocation of the Chinese, as was his trip to Asia last month when he made his none too cute "We're Back" declaration.  

Last Month in Australia Obama was quoted as saying, “Let there be no doubt: in the Asia-Pacific in the 21st century, the United States of America is all in.” 

If there was doubt in anyone's mind in Beijing, about American intentions Obama dispelled that doubt and any room for reasoned diplomacy by elaborating that this is a “deliberate and strategic decision” America is “here to stay”.    What an affront to the Chinese!  We were hoping the State Department would let this new offensive go quietly away.   Unfortunately, that is not to be.  Obama's "Strategy" is a dangerous road to take.  If it is intended to assist him in his re election efforts it will seriously backfire.  Unfortunately, the consequence won't be just Obama's and the Democrat Party.  The outcome of this foreign policy fiasco  will fall squarely on the shoulders of America and it's allies.  This new policy is literal insanity. It would appear Obama is playing right into the hands of Hu Jintao and the Chinese military leaders who are just chomping at the bit for a fight.    An Article in the Economist in a much more nuanced and cautious fashion discusses the concerns many other's have about the manner in which Obama is flexing his muscles and apparently bullying for a fight with the Chinese.  

China hasn't issued a stamp with this ferocious a dragon
since 1878 (Photo Xinhua)

This is the year of the dragon and they must be deft dumb and blind over in foggy bottom to have missed the significance the Chinese attribute to this auspicious event.  The dragon was a symbol of  China's Imperial Power and today it is a not too subtle symbol of China's Military, Political and Economic power.  That China chose to reissue such a ferocious stamp this year is no coincidence.

We have to ask ourselves why has Obama picked this time to insult and bully a world power that is vastly superior to our own, certainly in it's own backyard.  Does anyone think the Chinese are going to stand idly by as Obama in his arrogance, asserts his "right" to "ensure China's peaceful rise to power".    The implied threat in that statement from Obama and the Clinton State Department is palpable.  The US, in the person of Obama, is saying, "We're going to come into China's sphere of influence

and arbitrate and adjudicate any and all issues we decide have a national security interest to us."  Certainly, the United States should not cede it's position as a world power and it's interests but to do so in such an ignorant and arrogant fashion is inexcusable.

A bizarre thought occurs to us that given Obama's own love of Socialism and Marxism maybe his provocation of China is intended to give Hu and General Lin Yuan, (A possible successor to Hu) an excuse and license to go to war with America.

Posted by FarmerRicky

Related post:

• The role that the US plays in Asia: Containment of China!
• China warns US on Asia military strategy 
• ASEAN Sumit: US reasserts role as Pacific power ...
• G20, Apec without gusto; Asean for peace; US cold war ...

Related articles

• US Military Strategy to Asia: Poke a Stick In China's Eye (rightways.wordpress.com)

Yes, Facebook addicts, must get out to socialize more!

 

Facebook addicts should get out and socialise more

The Star/Asia News Network

WITH every new level of technology comes a corresponding wave of casualties.

From theft victims careless with their bank ATM cards to gullible folk cheated in online scams, the story is familiar enough.

So today we see the rise of Facebook addicts. The fact that this involves victims without criminal perpetrators does not make it any less serious.

Facebook addiction has been known to affect the psychological and physical health of its victims.

It also affects the personal relationships that victims had, or might have had, with others around them.

It is therefore a personal, domestic and social problem. The affliction is universally acknowledged by health professionals who have dubbed it Facebook Addiction Disorder (FAD).

It is compulsive, invasive of one's personal life, distorts priorities, damages one's capacity to relate to others around them and disorientates one to reality.

There are withdrawal symptoms, pangs of “cold turkey” and it is all downright senseless and wasteful.
How can it then be addressed effectively?

Relying on addicts to stop their addiction is not going to work. Neither will legislation, since Facebook can all too easily be accessed through computers or smartphones.

With children and young adults, FAD is particularly pernicious because it eats away at their health in their formative years.

Yet, it is with young addicts that the problem is perhaps easier to avoid with prudent parental intervention.

Adults as parents or guardians therefore have a responsibility to ensure that those under their care do not fall victim to FAD. And as adults anyway, with or without others under their care, they need to set an example by not falling victim themselves.

If push comes to shove, there is always the off switch.

For Malaysians to “have the most Facebook friends in the world” may at first sound gratifying, but in reality it is a condition ridden with problems and liabilities.

The best friends tend to be those you encounter in the flesh. A “friend” in cyberspace may be very unreal, whether as a notional friend of a friend, a fictional character, or even a predator.

If Malaysians have the most virtual friends in the world, it may well be that we have the least real friends in the world. And that would be another tragedy in itself.



Hi, I was a Facebook addict

I REFER to “Hooked on FB”  (Jan 20), on Facebook Addicton Disorder (FAD), and agree with Dr Nivashinie Mohan’s statement that people with this disorder “continue to go undetected because most addicts do not realise or admit they have a problem”.

If there had been a circle of addicts on the floor at the FAD forum, I would have introduced myself and said: “Hello everyone, I was a Facebook addict”.

When I decided to navigate to the “deactivate account” button last December, I thought I was making the hardest decision I would ever make, having been a Facebook member since 2006.

I did not have hundreds and thousands of friends (most of whom we ignore anyway and just concentrate on the five to ten so-called friends), but it was the excitement of waking up every morning literally dying to know what the rest of the world was up to.

I was an active lurker looking into my friends’ beautifully edited photos of where they went on holiday, what they cooked for their children last night, friends updating their status every five minutes (as if having a huge following on Twitter wasn’t enough) somebody’s wedding, graduation and etc.

After a while, I felt funny. Why is this so important? Why can’t we call, visit or text each other instead? Wouldn’t this be more intimate, more humanly possible to touch base sans the social network?

Aren’t we concerned about the security of our information over the Internet? A paedophile would have a field day ogling at our children’s profiles and the repercussions would be devastating.

And aren’t political and racial updates overly nauseating?

Don’t make me start with friends who actually upload positive thoughts by the dozen until you actually think they are really closet pessimists who crave attention (yes, that is yet another disorder).

Then again, self realisation is the best way to overcome any disorder, and admitting it is the next step to get oneself out of the problem. Who knows, maybe FAD sufferers may get help from support groups or toll free numbers in future.

To each his own, as the old saying goes.

For the majority, it is necessary to maintain one’s Facebook account as it is a vital part of one’s life and we are, as long as we are the ones in control.

For the minority, like me, we choose not to be the norm and will find other alternative communicating routes to get our messages across.

SUZLENE ZAKARIAH,
Seri Kembangan.

Have clear policy on FB for workers 

Bosses must devise solutions to deal with this IT challenge!

I WOULD like to share my opinion in relation to “Bosses face problem with workers wasting time on FB” (The Star, Jan 20). The use of social networking websites and its easy accessibility has posed a lot more challenges and problems to the employer than has been pointed out.

Social network, depending on the nature of the work, can be good or bad for productivity. For some it’s one of the most cost and time effective way to promote and achieve sales targets.

Some government agencies and NGOs use it in their work to reach more people and to better know their stakeholders.

For those who work long hours or are on the graveyard shift and are detached from family and friends, it may help reduce stress.

Social networking can be a recruitment tool. Some employers and recruitment agents use it to do background checks on employees.

On the converse, it can severely affect productivity as employees waste countless hours on social networking. When done in the office, it increases unwarranted Internet traffic and slows down office network speed.

A major issue which has got a lot of attention globally is employees making statements about their employers that are considered negative by the employer.

While statements which tend to lower the reputation of the employer in public can be considered libel, it is more complicated when it comes to employment relationships. There are two schools of thought.

In the UK, the employment tribunal upheld a decision by Apple to sack an employee for posting on Facebook his displeasure about his iPhone and various aspects of his company even though his remarks only reached certain people due to the privacy settings.

In the US, the National Labour Relations Board (NLRB) came to an opposite conclusion and found illegal a company’s decision to fire an employee based on disparaging remarks about her employer and on a work place incident she sent from her home computer 
.
I feel the UK approach is better. A negative statement by an employee can severely affect the employer. The company’s reputation is at stake, and it may affect the employer’s business goodwill and profits. Some job seekers might shun the company purely based on hearsay.

And, in a more sinister way, social networking can be used to disrupt industrial harmony by organising illegal strikes to cripple an entire industry and bring down the economy.

I don’t feel that a strict policy on social networking may discourage young ones from joining a particular company.

The main concern for the working young, or everyone for that matter, is the pay and benefits, and of course job satisfaction.

An employee frequently using social network at work should face disciplinary action to serve as a reminder to the perpetrator and to show others how serious the employer views such complacency.

And of course for the company to take disciplinary action it has to have rules to begin with. As long as there are no sanctions, employees will continually flout company rules and slack.

But again some might argue that it may not always be practical in real life as the world and society are addicted to social networking.

Some young employees, fresh to the working world, have no clue on responsible working etiquette and may think that employers don’t mind them engaging in social networking during work hours.

It is important that a clear policy is drawn up by the employers and brought to the attention of employees on how the company feels about it and how it affects them.

The responsibility of discipline at work does not start with the HR/IR practitioners. Our education system should have an active role in educating and shaping young ones who will be joining the work force one day.

Not only institutes of higher education like colleges and universities but schools as well should inculcate responsible work etiquette which includes being on the social network during work hours, among other things. Sadly, this is lacking.

While it is almost impossible to prevent employees from accessing social network sites, as it can be easily accessed through their smart phones, both employers and capable HR/IR practitioners have to come up with proper solutions to deal with whatever challenges advancement of technology throws at them.

JOHN MARK,Segamat.

Related post: 
You addicted to Facebook ?

The natural evolution of markets

THINK ASIAN By ANDREW SHANG 

 

Market change: A general view of ebay headquarters in San Jose, California. Websites like ebay and Alibaba has eliminated geographical space by allowing transactions in rural markets to be done online. —Reuters

Man is a social animal. The 19th century sociologist and philosopher Georg Simmel argued that trade and exchange is “one of the purest and most primitive forms of human socialisation.” Last month, while travelling through remote parts of West Timor, in Indonesia, I was able to study first-hand how rural markets operate. I could not help wondering why so-called primitive markets such as these work so well when complex financial markets can be so dysfunctional?

Rural markets in East Timor are wonders of trade. Men and women in tribal costume converge on different villages on different days of the week. Everyone knows when to go to which village for these markets, which typically start at dawn when produce is fresh and often finish by 11am. Economists would surely call this scene of bustling rural commerce a “concentration of liquidity.”

As the late Stanford economist John McMillan argued, the market is a human construction- a tool. The market has features to make it work smoothly: mechanisms to organise buying and selling; channels for information flow; laws that define property rights, and self-regulating rules that govern behaviour.

Most rural markets are much more complex than they appear. They sell everything needed for daily life and have their own hierarchies. The stalls of wealthier, established traders are sheltered and in the best locations, while poorer traders just spread their wares on the ground. Specialisation is evident even in this basic setting there are designated places to buy textiles, fresh meat or fish, vegetables or household goods. These markets also function efficiently as information exchanges. Prices differ depending on who you are and what you know. Tourists pay more because they do not know the local language or rules, while locals bargain vigorously.

In these basic markets, you can observe the entire range of business evolution, from simple production, to wholesaling to final sale. Everything is designed for convenience and to reduce transaction costs. For instance, there are no roadside petrol pumps. Instead, petrol is sold in small bottles because the most common transport are motorbike taxis that carry as many as three passengers plus the occasional chicken or bag of rice.

The permeation of technologies like mobile phones and the internet even into these remote rural areas has accelerated the speed at which information travels through these markets. This means even lower transaction costs between business, between consumers, and from businesses to consumers. In some instances, use of websites like eBay and Alibaba have eliminated geographical space by allowing transactions in such markets to be done online.

With technology ending the isolation of rural markets and linking them to global markets, the production and marketing game is changing beyond recognition. A similar phenomenon occurred in the airline industry. Budget airlines use the internet to sell forward excess capacity at below average cost, thus filling their planes to capacity and maximising profits. This created a new market because before, many people could not afford to fly.

You see the effect of high transportation costs clearly in rural markets. Here, locally produced goods are ludicrously cheap, but imported good are very expensive.

The study of modern, sophisticated supply chains enables us to appreciate the fact that producers do not necessarily make most of their money in the product-to-consumer chain. The rule of thumb is that if a product costs US$1 to make, the distribution and transportation costs may account for US$3 of the US$4 final sale price to the consumer. Common conceptions of innovation still focus largely on creating new products, whereas services or process innovation are probably much more profitable and add more value than is generally understood.

To illustrate, the global trade regime still has a “hardware” focus, concentrating on physical trade rather than the more complex and less measured services trade. Apple innovated not in manufacturing, but in design and lifestyle. This means that it can sell a product at much higher prices than its competitors. Once it has captured a market, value creation comes from downloading new apps for the iPhone and iPad.

Financial services have emerged as one of the most profitable businesses, certainly until the last financial crisis. For a time before the 2007 crisis, the turn on capital in the financial sector was 20% per annum, significantly higher than for manufacturing and other real sector businesses.

With the benefit of hindsight, we now know there were two major reasons for the large profits in finance. The first is that the physical cost of creation of a financial derivative is almost zero, as it is an abstract product of its creator's imagination. For many, the reason to buy a derivative is to hedge and reduce risk. If a buyer believes that the hedge is useful, which it can be under specific circumstances then he or she will be willing to pay a premium for that hedge. A second reason is leverage. The greater the leverage, the larger the profits are for both lender and borrower. But there is a catch it adds systemic risk to the entire market and can be fatal to the over-leveraged borrower.

The FX Accummulator is a good example. It is a financial product that looks and feels like a wonderful foreign exchange hedge that yields good profits for the speculator. However, many were not aware that at certain price levels, the amount of margin called by the lender could be greater than the total assets held by the speculator. Thus, what appears to be a “safe” hedge can turn out to be toxic, particularly when markets are volatile.

This raises the question whether financial markets have evolved beyond the limits of social safety. University of Southampton Professor Richard Werner is one of the first to point out that there are two aspects of credit creation one that contributes to real value creation and one that does not. Financial markets have evolved into highly complex systems that consumers, financial experts or regulators do not fully understand. Increasingly, they contribute less to social utility and become systemically fragile.

As McMillan presciently pointed out, “markets are not miraculous. There are problems they cannot address. Left to themselves, markets can fail. Viewed as tools, markets need be neither revered nor reviled just allowed to operate where they are useful.”

Rural markets arise from communities that have organised their commerce in such a way that reinforces social utility and stability. The Holy Grail of financial theory and practice in the world's advanced economies is to identify at what level of complexity financial markets exceed the limits of social stability.

Andrew Sheng is President of Fung Global Institute.