Restricting the sale of Bumiputera shares or firms only to other Bumiputera companies, consortiums or individuals will cause some “big problems”, Muda information chief Zaidel Baharuddin warned today.
While tabling the 12th Malaysia Plan (12MP) at the Dewan Rakyat yesterday, Prime Minister Ismail Sabri Yaakob said the sale of Bumiputera shares or companies exclusively to other Bumiputeras would help boost Bumiputera equity ownership to 30%.
However, Zaidel did not agree. “If this is really carried out, it will cause some big problems that will be detrimental to Bumiputera entrepreneurs,” he said in a statement.
“Often the word ‘Bumiputera’ is used as an excuse to implement a policy that actually only benefits a small group of rich Bumiputeras to stay rich, to the detriment of other Bumiputeras.
“We have seen this happen many times in the disposal of GLC and GLIC assets, and now it involves the private sector.”
Zaidel said the policy would reduce the number of investors who can own shares or companies as they could no longer be traded or sold according to market demand – which would then depress its value.
He also expressed concern over the fate of Bumiputera SMEs that would become dependent on a small group of wealthy Bumiputera individuals who would determine the value of their shares and equity.
He also questioned how new companies or “start-ups” that need a round of investment and injections could find the funds as they would not be able to offer their equity in the open market.
Zaidel also wanted to know the impact the policy would have on foreign investment as Bumiputera-owned companies may no longer be able to sell their shares and equity to foreign investors and companies.
He highlighted that Bumiputera companies would not be able to compete regionally if their investment opportunities are blocked and equity values dip, adding that this would push companies to Singapore, where they could gain access to international capital markets.
If the government was serious about helping Bumiputera companies and entrepreneurs, he said it should work towards increasing the value of their equity as much as possible according to market demand – as opposed to limiting its owners.
“If we really want to help Bumiputera entrepreneurs and traders, and not certain cronies, then this policy must be reviewed.
“What we want is a policy that can produce Bumiputera companies and entrepreneurs that are able to compete globally – instead of protecting the rich because of relationships, connections or acquaintances.
“We want to help entrepreneurs who are ‘Winnable’ instead of ‘WinCable’.”
Source : FMT