29-07-2019, 01:23 PM
(29-07-2019, 10:13 AM)specuvestor Wrote: [ -> ]just sidetrack a bit: I think it's the other way round that most business and politics are intertwined in the capitalistic centric world. US is supposedly a good reference.
It is enlightened policies that tries to separate them. I'm not sure if they can be separated totally but a robust structure and system should at least balance the conflict of interests
Yes, the close relationship between business and politics is ubiquitous all over the world. But there are different ways in which their relationships are structured, which may results in different economic outcomes, for any particular country.
Singapore's (or more specifically, its GLCs) model is like a 'melting pot;' the business entity and the political entity are merged. The state owns Temasek, which owns GLCs. There is not much conflict of interest between state and business, because they are one and the same. There is also not much conflict of interest between the state/business entity and the populace, because of a fair share of the efficiency/profit produced by the state/business entity is returned to the populace.
In other Asian countries, their model is more like a 'salad bowl;' the business entity and political entity are separate, although they often make use of each other to advance their own interest. The 'Alibaba' model of business in Malaysia is a good example, where business entity seek favourable concessions from the political entity. The kind of relationships I am referring to here are such as Anwar and Quek Leng Chan/Hong Leong; Daim Zainuddin and Berjaya/Vincent Tan, Mahathir and Ting Pek King/Ekran. Of course, you and some of the more experienced guys here like opmi will probably remember many such others.
The conflict of interest between the state/business (or Ali and Baba) and the populace in Malaysia has produced a big problem because the efficiency/profit produced by the state/business collusion is not sufficiently returned to the populace. Thus producing super rich Alis and Babas.
Malaysia has been trying to move towards Singapore's model by having the state acquire more ownership of businesses. But the problem -- and this has also been acknowledged by Dr M -- is that the state does not have the capacity to manage the business, and so has to rely on their mostly Chinese founder/partner to run the show. So the state owns only 30-40% of any large business, and not just because 30% Bumi ownership is the state policy; it is a sleeping partner, so to speak.
Hong Kong is another where 'Alibaba' is practiced, with almost no state ownership in business. When such an economic model is overly abused by business entities, the effect on the populace is acute.
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It is perhaps quite difficult to stop political entities and business entities from cooperating, but I think whether they are merged (i.e. state ownership of business) or separated will have a big impact in their jurisdiction.