Special Economic Committee: The need to be transparent, inclusive and mindful of saying stupid things

Najib confirms details of special economic task force, Channel News Asia, 26/8

Najib taps banker brother to be part of SEC, MalayMailOnline 26/8

Nazir Razak: National service call-up 

“What's important now is there's got to be focus. We need a dedicated team, 24/7, to monitor what's going on," says MITI minister Mustafa Mohamad, former exec director of NEAC, welcoming the setting up of the SEC. Critics remain unconvinced, with one Bank of America Merrill Lynch economist describing the absence of Bank Negara governor from the SEC "disturbing". (SEC will do little to soothe markets, MMO)

When Dr Mahathir Mohamad set up the National Economic Advisory Council (NEAC) in Jan 1997 as part of the goverment's response to the currency crisis then, a lot of people said stupid things about him, his administration and the country (ie all of us). Those stupid remarks were made by our own people, too: bankers who took out money and parked it in Singapore, punters betting against their own currency, politicians who said Mahathir was taking us on a short cut to hell, even wealthy editors (there were not many of them then but still more than today) who openly and unashamedly blamed the prime minister each time the ringgit dropped against the dollar or their shares took another beating. 

These were not stupid people; they were just saying stupid things. Even the deputy prime minister was trying to convince some of us that his boss was growing senile and that we should be running to the International Monetary Fund for help.

We went through all that, and more, then. With the benefit of hindsight, we should stop making stupid remarks about the setting up of the Special Economic Committee. Yes, I mean we - you and I - and not just the power people that Nazir Razak was referring to the other day, just before he was called in my his brother the prime minister to do national service via the SEC. This is the time to show support for Minister in the Prime Minister's Department AWO and his committee of extraordinary Malaysians, including Nazir, Khazanah's Amok, and Nor Mohamed Yakcop.

AWO: Right man for the job

AWO's SEC has got to be transparent from the start about what it's planning to do in order to minimise the impact of the current economic crisis. In this day and age, including the people online would be as crucial as engaging them face to face, and excluding them is a sure recipe for disaster and failure. This alone makes the SEC's tasks already more challenging than the NEAC of the 1997/1998 era. 

And not just the central bank's governor, the absence of politicians from the Opposition will also be seen as disturbing to some people. Good thing - I think - that the ex-banker AWO is not your typical politician so he will pick the best brains regardless of race and political affiliation to strengthen the SEC. 

To AWO and team, I wish you all the best.

Revision exercise: 

Mechanism and policies for economic recovery by Victor Wee

"Two weeks after the floatation of the Thai baht on July 2, 1997, the ringgit was allowed to find its own level. By January 1, 1998, the ringgit had depreciated by 35% and the Kuala Lumpur Composite Index fell by half. The currency depreciation and falling stock market worsened in 1998. Meanwhile, the rising number of corporate failures and non-performing loans affected the willingness of banks to lend. The country was in the grip of a severe credit squeeze, and the full impact of shrinking demand and rising corporate distress were felt by the entire economy ...."