Saturday, November 26, 2011

70-year-old reaps reward for his cucumber innovation

PUTRAJAYA: His creativity in solving a clogged “fertigation” system doubled the harvest of cucumbers at his farm and won a 70-year-old farmer a top award for innovation.
Salleh Ngah, who lives in Kampung Sura Hujung in Dungun, Terengganu, was also said to have slashed the maintenance cost at his farm by half.
“The Anugerah Inovasi Teknologi Petani (Technology Innovation by Farmers Award) is an acknowledgment of creative and innovative farmers who have succeeded in producing a method to help them in their daily work.
Innovative read: Raihan (centre) getting a closer look at the Plantations Department’s Innovation Book, which was launched at Wisma Tani.
“Winning ideas will attract the attention of other farmers, who may also adopt the new techniques or tools to increase their productivity,” said Agriculture and Agro-based Industries Ministry deputy sectretary-general (planning division) Raihan Sharif, who presented the award to Salleh at an award ceremony in Wisma Tani.
Salleh had suspended his farm's irrigation system to allow free movement of liquid in his fertigation project.
Fertigation is a technique used to apply dissolved fertiliser to crops through an irrigation system.
The simple modification of irrigation had increased the cucumber harvest from 5kg per polybag to 10kg per polybag.
The ceremony also saw eight other awards being given away to ministry staff who have shown exemplary achievement in their respective fields.
A compilation of innovative ideas by the Agriculture Department were documented in the book Inovasi-Inovasi Jabatan Pertanian 1995-2010, which was also launched at the ceremony.

Bersih 2.0 goes global to reform postal voting

KUALA LUMPUR: Electoral reform proponent Bersih 2.0 has launched a global movement aimed at reforming the postal voting system.
The coalition's proposal on absentee voting would simplify what it claims is a “complicated and tedious” postal voting process while improving the efficiency and security of the current system.
The proposal, part of Bersih 2.0's eight demands presented to the Parliamentary Select Committee on electoral reform earlier this month, would split absentee voters into four categories.
They are absent service voters comprising military and police personnel but not their spouses, overseas voters in Singapore and Brunei, overseas voters elsewhere and absent domestic voters.
Bersih 2.0 said that only overseas voters elsewhere should be afforded the option of postal voting, or alternatively go for advance voting on the day before the actual polling day.
Absent service and absent domestic voters on the other hand should be allowed to choose between advance voting or distance voting which would be done on polling day itself while overseas voters in neighbouring Singapore and Brunei should be allowed to do distance voting.
Bersih 2.0 steering committee member Wong Chin Huat said the Global Bersih movement would push for the adoption of this proposal at events organised by Malaysians living in 12 cities across the globe.
Meanwhile, several groups will be organising demonstrations over the weekend and next week to protest against the recently tabled Peaceful Assembly Bill 2011.
A candlelight vigil was held last night near the Bar Council office in the city.
Next Tuesday, lawyers will march to Parliament at 11.30am from the nearby Royal Lake Club.
At the end of the march called “Walk For Freedom 2011: Peaceful Assembly Bill Cannot And Must Not Become Law!”, a memorandum will be submitted to Deputy Minister in the Prime Minister's Department Datuk Liew Vui Keong.
The Bill, tabled by Minister in the Prime Minister's Department Datuk Seri Nazri Aziz earlier this week, has been described as more stringent than the current legislation.
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Cabinet nod for green guidelines

KUALA LUMPUR: The Cabinet has approved a green neighbourhood and low carbon city framework and assessment system aimed at reducing the nation's carbon emissions.
Housing and Local Government Minister Datuk Seri Chor Chee Heung said the guidelines would bring the country a step closer to achieving the goal of reducing its carbon footprint by 40% by 2020 as announced by Prime Minister Datuk Seri Najib Tun Razak in Copenhagen last year.
“We are going all out to push the guidelines.
New township: (From left) Miss Universe Malaysia 2012 Kimberley Ann Estrop- Leggett, Lee, Chor and Tan looking at a residential model during The Star Property Fair 2011 at the Kuala Lumpur Convention Centre Friday.
“Studies have shown that urbanisation contributes more than 50% of greenhouse gases released into the atmosphere. Our small cities and townships are getting bigger,'' Chor said after launching The Star Property Fair 2011 at the Kuala Lumpur Convention Centre yesterday.
Also present were Star Publications (M) Bhd executive deputy chairman Datuk Vincent Lee and chief events officer Iris Tan.
A Cabinet paper on the guidelines was approved yesterday, said Chor, adding that it was a joint collaboration between his ministry and the Energy, Green Technology and Water Ministry.
The guidelines, which would be distributed to local authorities, would promote 3R (reduce, reuse and recyle) practices as well as other environmental-friendly policies.
“We hope developers will help spur green neighbourhoods by providing more cycling and walking paths to reduce vehicle use.
“The guidelines are not compulsory but it makes good business sense to do it,” he said.
Chor also congratulated The Star for organising the property fair which had not only attracted developers but lifestyle companies as well.
“It is fair to say that The Star Property Fair is by far the largest. Congratulations for a fantastic job.”
On errant developers, Chor reiterated that the amendments to the Housing Development (Control and Licensing Act) 1966 would ensure “fly-by-night” operators are severely dealt with.
The Bill, which is expected to be tabled in Parliament soon, would see errant developers facing criminal charges and jail sentences for abandoning housing projects.
The Star Property Fair 2011 is open from 11am to 7pm and ends tomorrow. Entrance is free.

Deck the malls this holly-day

KUALA LUMPUR: Christmas is about a month away but retail stores in shopping malls have started decking their halls to attract holiday shoppers.
At Mid Valley Megamall, although some stores stuck to evergreen designs with the traditional Christmas trees and decorative ornaments, others preferred to display more contemporary items.
Home furnishing and accessories store Rooms chose to go for an unconventional look this year, opting for square-shaped Christmas trees, mini table-top trees made out of tiny silver baubles and others constructed out of hay or other material.
Shiny baubles: Nina How choosing from a variety of Christmas tree ornaments, arranged according to themes at Metrojaya, Mid Valley Megamall Friday.
College students Hou Yin and Kenneth Tan, both 19, said they found the unique ornaments at Rooms “pretty cool” although they were not looking to buy any decorative items in particular.
Another store, The Paper Boutique, was seen sporting beautiful paper trees in its display window.
“I am looking forward to Christmas as it brings in the most customers looking for decorative paper and gift boxes,” said its manager, who only wished to be known as Lee.
Meanwhile, gift store Lovely Lace has brought out their best selling items for the season teddy bears.
“Teddy bears are always a popular choice for Christmas presents,” said a store supervisor, adding that most of their customers were men buying teddy bears for their girlfriends or wives.
Home specialty store Living Quarters settled on a more classic look, showcasing six large Christmas trees, each decorated to different themes.
“Customers can choose their ornaments according to the theme they like. The best selling theme so far is traditional,” said a sales representative.
Shopper Michelle Lim Yuen Peng, 30, said she bought a green Christmas tree with attached berries from the store to add to the festive cheer in her home.
“My theme this year is gold and crystal. I am going to hang golden angels on my new tree and am planning to throw a party for my friends in my home,” she said.

Those who lose govt money will be made to cough it up, says PSD

Officers who cause the Government to lose money due to their negligence will be made to repay a portion of the lost revenue and they may even be sacked.
If there are cases of embezzlement, ministry and department heads have to take the responsibility to report the matter to police so an investigation can be carried out.
These are among the measures introduced by the Public Service Department to ensure that civil servants are held accountable for the losses highlighted by the Auditor-General in the 2010 Report.
The department issued a set of comprehensive guidelines last Tuesday to all ministries and state authorities to refer to before taking action against any guilty party.
PSD director-general Tan Sri Abu Bakar Abdullah said this was decided during a meeting with all secretaries-general and the PSD on Nov 2.
“I hope all ministries will treat this seriously. We need to do this to protect the image of the civil service and to ensure that efforts to enhance the public delivery system are not affected,” he said.
“If there are cases of missing government funds or properties, then an immediate internal probe should be conducted and a final report submitted (to the PSD) within four months,” he said, adding that copies of the report should also be forwarded to the Treasury and the state financial officer.
Abu Bakar said that if the Treasury or the state financial officers felt that the errant officer needed to be slapped with a surcharge or be disciplined, it should then make a recommendation to the respective service commission.
Most civil servants come under the Public Service Commission. However, there are other similar bodies such as the Police Commission and Education Services Commission.
Abu Bakar added that all ministries should provide answers for queries raised by the latest Auditor General's report as well as state if disciplinary or legal action would be instituted against the wrongdoers.
However, arrears or revenue which cannot be collected due to reasons beyond the public servant's control can be written off provided it is approved by the Finance Minister or the respective Mentri Besar/Chief Minister.
Abu Bakar also said a secretary-general or a department head must notify in writing to the Treasury or the state financial officer when and why a particular revenue could not be collected.
Copies should also be sent to the Auditor-General and the Accountant General.
Abu Bakar said the Treasury or the state financial officer was also authorised to appoint officers from other sections in a ministry or department to carry out investigations into financial irregularities or embezzlement.
Ministries or state departments, he said, should obtain in writing whatever information they required from contractors, companies, consultants or individuals in the course of their investigations on alleged wrongdoings.

Malaysia re-elected to International Maritime Organisation

KUALA LUMPUR: Malaysia has been re-elected for the fourth consecutive time to the International Maritime Organisation (IMO).
Transport Minister Datuk Seri Kong Cho Ha said Malaysia garnered 120 votes from the 155 eligible voting states to sit on the 20-member council's Category C for countries with maritime and navigational interests for the 2012-2013 term.
"This is a great achievement for Malaysia as we managed to get re-elected for the fourth consecutive time.
"This shows that the members are satisfied with our performance at the council all this while," he said in a text message to Bernama.
Kong expressed his appreciation to the entire campaign taskforce for its hard work.
The Malaysian delegation to the assembly, headed by Kong, comprised Malaysian High Commissioner to the United Kingdom and Northern Ireland Datuk Seri Zakaria Sulong and several officials from the Transport Ministry.
The council's Category C members are Singapore, Bahamas, Indonesia, Thailand, Australia, Kenya, Cyprus, Belgium, Turkey, Morocco, the Philippines, Liberia, Chile, Jamaica, Malaysia, Malta, South Africa, Egypt, Mexico and Denmark.
The newly-elected members of the council's Category A, which comprises 10 states with the largest interest in providing international shipping services, are China, Panama, Greece, South Korea, Italy, Russia, Japan, the United Kingdom, Norway and the United States.
The members of the council's Category B, which comprises 10 states with the largest interest in international seaborne trade, are Argentina, Germany, Bangladesh, India, Brazil, the Netherlands, Canada, Spain, France and Sweden.
The council elections are one of the highlights of the IMO general assembly, which convenes every two years.
Among others, it makes policy decisions on the IMO's direction and endorses its activities.
The IMO is the United Nation's specialised agency responsible for the safety and security of shipping and the prevention of marine pollution by ships.

Monday, November 7, 2011

Refugee headcount

For the first time, Malaysia will join hands with the United Nations High Commissioner for Refugees (UNHCR) and register refugees and asylum-seekers to better protect them. The move, expected to commence in January, involves some 94,800 refugees and asylum-seekers.
“Having their biodata in the government database will ensure better protection for refugees especially against arrests and detentions,” said the UNHCR.
Other developments:
> Deputy Foreign Minister A. Kohilan Pillay says the exercise is a “timely move”;
> Human rights activists welcome the move, saying Malaysia should also be a signatory to the 1951 Refugee Convention; and
> Bar Council says the decision is a step in the right direction but notes that more needs to be done.
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Proton’s Exora electrifies in London green race

Proton’s Exora range-extended electric vehicle (REEV) created history when it defended its title as the “most energy-efficient multipurpose vehicle” at the 2011 Future Car Challenge. More accolades came in the form of it being declared joint-winner with the 2012 Toyota Prius plug-in petrol hybrid as the “best overall range extended electric vehicle”.
Racing into the future: Proton’s Exora range-extended electric vehicle successfully defended its title as the most energyefficient multipurpose vehicle at the 2011 Future Car Challenge in London on Saturday.
The results came after an exciting 92km “race” on Saturday when 70 vehicles, more than half of them running on electricity, were flagged off from Brighton, at the southern tip of England.
The challenge was organised by Britain’s Royal Automobile Society, but the race was not about finishing first.
Rather, the Future Car Challenge (FCC) was created by the Royal Automobile Club (RAC) to see who could use the least amount of energy to cover the distance.
However, participants had to complete the challenge within 3.5 hours. An onboard data-logger measures the actual amount of current draw before, during and after the race to determine the actual amount of electricity used.
The FCC was RAC’s initiative to promote the adoption of green vehicles by offering a platform to demonstrate the potential of clean-energy cars.
A total of 17 categories were created for a wide variety of low-emission vehicles such as hybrids, plug-in hybrids, range-extended hybrids as well as fully electric vehicles.
Other than the Exora REEV, Proton also entered a Persona REEV, and a fully-electric Saga.
The Exora REEV and the Persona REEV are powered by a 70kW motor that is backed up by a small petrol engine that kicks in solely to recharge the lithium ion battery packs put together by Frazer-Nash Research Limited, Proton’s technical partner in its electric vehicle development.
When the Exora REEV was declared best extended range electric vehicle (E-REV) at last year’s inaugural challenge, it surprised the entire field, including Proton itself.
“We were much more confident this year,” explained Datuk Zainuddin Che Din, Proton’s project director for green technology development.
Proton group managing director Datuk Seri Syed Zainal Abidin Syed Mohamed Tahir said: “I am overjoyed, to say the least.”
Frazer-Nash’s director for regional operations Gordon Dixon said the win validated his company’s faith in EVs as the platform for the future.
Proton said the vehicles would be in production by 2013.

Better if limestone is locally processed

PETALING JAYA: The country will benefit economically if it stops the export of raw limestone, said the chairman of a local company involved in limestone processing, according to an entrepreuneur.
Amman Jaya Minerals (M) Sdn Bhd chairman Datuk Ramly Ahmad said apart from the revenue potential, encouraging a local processing industry would create employment opportunities for locals.
Nation's first: Amman Jaya Minerals is the first fully local high-tech limestone processing plant in Malacca.
Ramly said it would also contribute towards other industries that use limestone as their ingredients.
“Foreigners are the biggest beneficiaries now as they take away raw limestone for paper, paint and other related industries abroad and they are doing it at our expense,” he said when commenting on The Star article that billions are lost due to the export of the raw limestone from the country.
In its front-page report on Nov 3, it was also reported that Malaysia was the only country in the South-East Asia that allowed the export of raw limestone.
Ramly said incentives must be offered by the Government to locals who ventured into the limestone-processing industry.
He said Amman Jaya Minerals was the first fully local high-tech limestone processing plant in the country.
The plant, in Panchor Jaya, Seremban, is due to commence operations in January.
Ramly said the plant would produce ultra-fine calcium carbonate for the export market.
He said more than 100 people would be employed and the company’s product would be used in the manufacture of high grade paper.
Ramly said they had invested about RM30mil in the plant and faced a lot of challenges along the way.

Chinese option to continue

PETALING JAYA: Chinese primary schools will continue to teach Mathematics and Science in Chinese.
This is despite them being given an option under the Education Ministry’s new approach to maintain the Teaching and Learning of Science and Mathematics in English (PPSMI) policy for students who have started learning the subjects in the language.
United Chinese School Committees Association of Malaysia (Dong Zong) deputy chairman Chow Siew Hon said Chinese schools would not give up on their mother tongue education.
“Chinese schools are not greatly affected by the new approach because we have always taught and will continue to teach the two subjects in Chinese,” he said.
He said even when PPSMI was first implemented in 2003, Chinese schools continued to offer the two subjects in Chinese.
Deputy Prime Minister Tan Sri Muhyiddin Yassin said schools would have the option to teach Science and Mathematics fully in English, Bahasa Malaysia or bilingually.
A Tamil school headmaster in the Klang Valley said his school would consider offering the two subjects in English because his pupils had benefited from PPSMI.
“Before PPSMI was introduced in schools, my pupils hardly conversed in English. Now, they are a lot more confident using the language,” he said.
Pahang Tamil School Headmasters Council chairman R.P. Velayutham said he would consult the stakeholders for the school’s direction on the medium of instruction.
“I plan to listen to the needs of parents and students before making any decision,” he said.
“I also want to seek expertise on how to improve English and Tamil proficiency, and ways to boost the grades for Mathematics and Science,” he added.
SRK (T) Telok Panglima Garang PTA chairman S. Muthamil Selvan also welcomed the announcement, saying that he was relieved with the Government’s latest directive.
“We believe the teaching of Science and Mathematics should be done in English as it is a way forward, especially for students in rural areas. It gives them a competitive edge,” he added.
He said being able to communicate well in English was a tool for Tamil school students from underprivileged background to move forward in life.
The PPSMI policy was initiated by former prime minister Tun Dr Mahathir Mohamad and implemented in phases, beginning with Year One, Form One and Lower Six students in 2003.
It was then announced in 2009 that the Government would reverse the policy and revert to Bahasa Malaysia in national schools, and Chinese and Tamil in vernacular schools, while more emphasis would be placed on English.

Don: English standard of undergrads still not up to par

Malaysia is on par with or ahead of some of the regional countries in terms of investment in education. However, the quality of its undergraduates’ command of English still remains an issue.
Dr Marie Aimee Tourres, a senior research fellow at the Department of Development Studies, Universiti Malaya (UM), said it was crucial for graduates to have a good command of English to ensure they would be able to compete effectively in the global job market.
Nevertheless, “in terms of education spending, Malaysia is comparable to some countries in the region based on the percentage spent over its gross domestic product (GDP) growth”, she said.
She said Malaysia was actually spending more than other countries.
In Budget 2012, RM13.6bil was allocated to the social sector, including education and training, health, welfare, housing and community development.
Dr Tourres said there was also a lot of focus given to training and re-training of graduates, which was important to continuously upgrade skilled and knowledge workers in the country.
However, the quality of undergraduates remains an issue.
“Language is definitely an issue,” she said, citing a recent publication by the World Bank, The Road to Academic Excellence, which is a study on what contributes to a world-class research university.
The study compared UM and the National University of Singapore (NUS) in a chapter titled “The National University of Singapore and the University of Malaya: Common Roots and Different Paths”.
In the report, it was stated that as NUS kept pace with the demands of a growing economy that sought to become competitive internationally, with English continuing as the language of instruction and research, UM began to focus inward as proficiency in English declined in favour of the national language.
“This generation will have to face international standards and competition in terms of job market, as part of globalisation,” said Dr Tourres.
She cited Pakistan, where she gives lectures, as an example.
“In Pakistan, although the people speak different dialects next to the Urdu language, their English is better than our graduates,” she noted.
She said it made them more marketable in the global environment.
Dr Tourres believed that even if Malaysia gave more focus to English, the national language and culture could still prosper, provided that teaching was made interesting. — Bernama

Fighting rising cost of living

PETALING JAYA: There are ways to manage rising cost of living although it is determined by internal and external factors.
Fomca chief executive officer Datuk Paul Selvaraj said both the Government and consumers could play their part in ensuring affordability and food security for the long-term.
This included increasing internal food production, ensuring fair competition and educating consumers about financial management.
“Overall, food prices and cost of living will continue to rise.
“The effects of climate change and higher demand globally also play a part,” he said when asked about rising food prices.
“Our food import bill is very high. Thus, we are quite vulnerable to changes in the international market.
“Climate change creates a lot of uncertainty and causes price fluctuations.
“Long-term agriculture goals will help us deal with this uncertainty and ensure adequate food supply.”
Paul said the Competition Act, which comes into effect in January, would help weed out price distortions, eliminate price fixing and ensure fair play at all levels of the agriculture supply chain.
He said having a direct chain between producers and consumers via farmers’ markets would also help reduce costs.
“We should encourage more farmers’ market or pasar tani,” he suggested.
The Kedai Rakyat 1Malaysia, he said, would also help ease the burden as it sold products at a cheaper price.
However, he noted that consumers needed to be more open about it as old habits of buying branded goods were too entrenched.
The products sold at these shops only carry the 1Malaysia brand.
Fomca, he said, was focusing on financial education programmes to help consumers brace for the higher cost of living.
“Cost of living can eat into the quality of life,” he said.
“People, especially those living in the city centre, will feel squeezed.”

Floods encircle Bangkok industrial estates

BANGKOK (Reuters): Floodwater encircled two industrial estates in the east of Bangkok on Monday and disrupted bus services in the Thai capital, although mass transit train systems were still running and central commercial districts remained dry.
Starting in the north and northeast of the country in late July, the water has slowly moved south, overwhelming industrialised provinces and rice areas in the centre and moving slowly into Bangkok over the past three weeks. Somkid Tanwatanakul, deputy governor of the Industrial Estate Authority of Thailand (IEAT), told Reuters floodwater had reached the vicinity of the Lat Krabang Industrial Estate but the situation inside the zone was "still normal".
"The water has surrounded the complex over the past few days with a level now as high as 1.4-1.5 metres," Somkid said.
"We have strengthened dikes around the estate to 2.60 metres (8.5 feet) high. My worry is if this much water continues to hold for a long time with nowhere to go, the estate might not make it."
The estate, which is 10 km (6 miles) north of Bangkok's main Suvarnabhumi airport, covers nearly 1,040 acres and employs almost 50,000 workers in 254 factories making car parts, electrical appliances, food and beverage.
Among the international firms there are consumer goods giant Unilever Pcl , Johnson & Johnson , Isuzu Motors and Honda Motor Co .
It was a similar picture at the Bang Chan estate nearby.
"Our factory is still dry but outside, it isn't," Yaowaret Kanjanachotkamol, a marketing manager at President Bakery Pcl, said. "We have started to see water in some parts of the estate."
The government's flood crisis centre said residents of 11 districts in Bangkok had been told to evacuate and partial evacuation zones had been declared in another seven.
But it said its use of so-called Big Bags - huge sandbags weighing 2.5 tonnes - to build a protective wall 18 kms (10 miles) long across the north of the city appeared to have been successful in reducing flows into the inner city along the first 6 kms constructed.
WEEKEND MARKET OPEN
The government says 506 people have been killed and 25 of the country's 77 provinces are currently affected.
The Chatuchak district in northern Bangkok was among the latest to be issued with an evacuation order as floodwater moved in over the weekend, although its huge market, popular with tourists and locals alike, remained open. The overhead Skytrain, whose northern terminus is by the market, is running normally, as is the underground MRT system, which goes through the area. But many poorer residents rely on buses to get around and they were having more trouble.
Saitarn Siriatcharanon, 56, told Reuters Television she had been struggling for six hours to reach her son in the flooded area, whereas normally the same journey would take 30 minutes.
Bangkok Mass Transportation announced the suspension of bus services in the flooded areas, with military trucks offering an alternative in places. "I think it will take at least a month for the situation to get better," said student Tanida Aupornrungrat, a view shared by the authorities, who are having to import pumps to help.
Floodwater is heading towards Victory Monument, where many buses leave Bangkok for other towns. Rama II Road, a major highway to the rubber-producing south of the country, which has not been affected by the floods so far, is also threatened.

Greek tragedy sours Summit

Global Trends
By MARTIN KHOR


The G20 Summit last week was scripted to celebrate a European strategy to exit the debt crisis but it was diverted instead into a new act of the Greek tragedy that can lead to global recession.
LAST week saw pure drama on an epic scale as the Eurozone plan to exit its debt and currency crisis almost crumbled when the Greek Prime Minister announced he needed a national referendum to approve a bailout programme.
This bombshell came last Monday on the very eve of the G20 Summit in Cannes which had been expected to cheer the European leaders for finally getting their act together.
Instead, the G20 Summit became another new act in the Greek and Euro tragedy.
The summit concluded last Friday without any concrete results. “Global recession grows closer as G20 summit fails,” warned the London Guardian.
The Eurozone play will now stumble on at least until next February and probably beyond. New scenes and acts will get worse, until it finally gets better, hopefully.
The European plan, so painfully pulled together and announced on Oct 27, had three aspects. First, Greece would get a new €130bil (RM557.63bil) bailout loan, while its creditors (mainly European banks) would take a 50% haircut (be repaid only half) on their loans to Greece.
This is a default, but (hopefully) not to be termed such because the creditors would be persuaded by their governments to accept the haircut and the debt restructuring would be “orderly”.
Second, banks that suffer a blow from the haircut would be provided 105bil (RM450.39bil) for recapitalisation so that they would not go under. The Greek crisis would thus be resolved (at least for now).
Third, the European Financial Stability Facility (EFSF), which now has 440bil (RM1.887tril) but would have to use part of it for the first two actions, would be boosted so that it can command more than 1 trillion (RM4.289tril). This is needed for the next big battle – preventing a new and much bigger debt crisis in Italy.
This multiplying of the EFSF’s firepower was planned to be done by getting China and other developing countries to provide loans in a “special vehicle”, and leve­raging the EFSF’s funds through loan guarantees to private creditors. The IMF is also asked to chip in with its own mega loans.
The three-piece solution was to be presented to the G20 Summit with hope that China, other developed countries and the IMF would buy into the plan and cough out the needed billions.
But Greek premier George Papandreou upset the apple cart through his own plan to put the Greek bailout to the public in a referendum. Just the prospect of a public rejection would have scuttled the whole European strategy.
Even though Papandreou withdrew his referendum idea after being scolded at the pre-G20 dinner by the furious French President and German Chancellor, and even after he won a Parliamentary vote of confidence, the damage had been done.
At the G20 summit, neither China nor any other country agreed to join the­ ­­ European bailout. Under­stan­dably so, since the political uncertainties heightened the possibility their money would not be safe.
The G20 leaders also did not authorise the IMF to increase its bailout loans or to issue special drawing rights (SDRs) to the Europeans. They will forward the decision on this at the G20 finance ministers’ meeting next February.
Till then, more convulsions can be expected. The next fire to put out, and a much bigger one than Greece, is Italy.
It has 1.9tril (RM8.14tril) of debt. Payment of US$53bil (RM165.01bil) is due in November and December, and many are nervous if that will go ahead.
Italian premier Silvio Berlusconi, rejected an IMF facility and only agreed under pressure by other G20 leaders to subject Italy’s economic performance to a quarterly scrutiny by the IMF.
What should not be lost as events unfurl is the great tension between the proposed technical solutions and the political reality on the ground.
The reason the Greek politicians are scrambling is because the Greek citizens are up in arms in protest against the policies attached to the bailout.
Big cuts in government jobs, social spending, pensions and wages, privatization and so on, have already caused the people hardships and this is just the beginning.
Even by 2020, Greece’s debt will be the equivalent of 120% of GNP.
In other words, after a decade of severe and increasing pain, they will be back to square one.
Something is surely wrong with the solution. In a perceptive column, the renowned British economist Samuel Brittan wrote in the Financial Times why he would vote ‘No’ in a Greek referendum.
“The condition of financial support is ever more severe fiscal austerity,” he wrote. “Never mind that Greek national output is already more than 9% below its 2008 level. Never mind that unemployment has hit 17%.
“The Greeks are being told to squeeze, squeeze, squeeze. I know how I would have voted in a referendum, had it gone ahead.”
The Greeks may have to decide, now or later, whether the pain is worth taking to stay in the Eurozone. Or whether they should opt out, re-introduce their drachma currency, regain monetary independence and change economic policy so that they can grow their way out of the crisis.
That may require a bigger default than the orderly 50% being planned, and a period of being labelled a “pariah”.
But as Argentina and Iceland showed, a combination of default, clearing of the decks, and growing again is possible, if done correctly.