Saturday, May 9, 2009

Readiness of ASEAN Banking Sector Integration: Recent Development and Statistical Evidence

[Report for “MOHE/BNM Attachment Program”]


ASEAN has a vision to form a single community by 2015. Thus, ASEAN integration has been a topic of great interest but unfortunately, attention has been over-focused on economics aspect. This paper aims to study the specific aspect of ASEAN banking sector integration within three objectives. Firstly, this paper aims to compare the ASEAN countries’ respective commitments to its own members through ASEAN Framework Agreement on Services (AFAS) against their commitments to the world under General Agreement on Trade in Services (GATS). Secondly, this paper aims to evaluate the readiness of ASEAN for banking sector integration using statistical approach. Thirdly, the statistical results from the second objective will be utilized to construct an indicator of readiness for ASEAN banking sector integration. The results reveal that ASEAN countries’ commitment to AFAS did not differ much from their respective commitments to GATS. Statistical evidence shows that there are vast differences in monetary conditions between ASEAN countries, hence causing difficulties for one-step-total-integration. Therefore, “paired-integration” is proposed based on the results of “readiness indicator”. Optimal pairing for Malaysia is Thailand, followed by Philippines and Singapore.

'Quo vadis' Hindraf?

Har Wai Mun | May 4, 09 3:44pm

After being greatly successful in swinging the Indian vote in favour of Pakatan Rakyat since the 12th general election and for almost every subsequent by-election, Hindraf seems to have finally reached a crossroads, pondering which future path to go onto next.

Intense government suppression including the detention of their leaders and banning the movement makes Hindraf's future more uncertain. An internal rift does not help either.

Nevertheless, the biggest threat to Hindraf's future is neither the government nor its internal conflict, but the direction of their struggle in the long run. Two questions are of utmost importance to Hindraf.

Firstly, should Hindraf's continue their struggle by solely focusing on the Indian community or should encompass the multi-racial society in Malaysia?

When voters rejected Barisan Nasional's racial politics, one would ponder whether Hindraf would face the same fate in the near future. Do the voters want another MIC after they have rejected one?

Hindraf members could stress that they really care and fight for Indian community unlike the MIC. Yet truly, Malaysians could point out that there are poor and marginalised Malays and Chinese too.

Thus, how about them? Let the DAP take care of the Chinese while PAS and PKR help the Malays? I certainly hope not and thankfully do not see those abovementioned parties moving towards that direction of racial politics.

However, due to relatively more pressing problems from the Indian community, Hindraf is certainly being more practical in giving their undivided attention to the community for the moment.

But in the future, Hindraf's survival requires them to enlarge their vision and struggle for all Malaysians regardless of race to uphold the true spirit of ‘people power' as they originally popularised as ‘Makkal Sakhti'.

The second question is should Hindraf move towards attaining formal political power? On one hand, restriction to do so could limit the effectiveness of the movement to bring changes at the national level.

Thus, parliamentarians, ministers and state executive councilors are needed. On the other hand, a ‘yes' answer could possibly lead to certain individual members becoming overly politically ambitious.

By the way, bear in mind that Hindraf is officially an illegal movement, hence it is impossible for it to become a political party. Registering a new political party using new name is also equally impossible under the BN government.

So, the most workable way to gain formal political power is through existin political parties. Yet, another dilemma would be whether Hindraf parliamentarians of other party memberships could unrestrictedly represent the movement.

The answers to these questions might unlock the future direction for Hindraf. Currently, their existence seems to be more energised by emotion rather than on long-term basis practicalities.

Hindraf's ‘partnership' with Pakatan Rakyat is on a rather ‘ad hoc' basis based on the scenario that they share the same enemy (BN).

For Hindraf and Pakatan Rakyat to survive and glorify in Malaysian history, their ‘enemy' should not be BN, but poverty corruption, unfairness, restrictions on freedom (particularly the Internal Security Act), the alarming economic crisis, the declining education standard and the degradation of our environment.