NKRA : a closer look at the big numbers by a simple man

The Prime Minister has announced 8 new investment projects worth RM1.4 billion under six National Key Economics Areas (NKRA) covering agriculture, education, aerospace, wholesale, retail and manufacturing.
 ETP: PM announces RM1.43bil in investments
On first impression, the big zany numbers look impressive so let’s take a closer look.

(source: extracted from page 2  of the Sun morning edition 8th September)
Palm oil
The first item, palm oil, where it was reported in the Sun as “development of downstream sector of palm oil industry, including a world-class research and development centre:”
In short, someone is going to invest RM706million into down-stream, i.e. post plantation activities of palm oil industry, like manufacturing, distribution, branding and marketing.
The big words actually did not explain exactly what will cost RM706 million and how exactly additional GNI of RM1.15 billion can be created – is it via new products and new markets, what and how the multiplier effect will generate the stipulated GNI Impact  etc? A big number must have many components and from the Sun report, I do not see a single clear cut explanation.
R & D itself is exploratory in nature and estimating accurately revenue arising from successful R & D activities that can be translated into viable commercial production and sales is extremely tricky (without even factoring in competition from other products such as soya bean and peanut oil) so I would seriously question how the “expected gross national income” of RM1.15 billion is a creditable statement of optimism and of course, vote pulling.
Besides, the GNI projection covered a period up to 8 years away. I would be interested to see what the BN administration have forecasted for the next 8 years, details of which, voters can assess if the forecast are valid assumptions, or just big hyped up numbers which basis can be challenged.

Merdik TV
Why would the BN administration want to burn another RM400million (equivalent to the original budget of the new Istana Negara)  and add another 650 civil servants onto an already bloated civil service, and over the next 3 years, to buy 1,410 TV sets, employing an average 2.17 staff per TV to broadcast health messages? At R400million a pop, each TV on average will cost us RM238,687.94.
We already have RTM which is free-to-air  and certainly have bigger reach than 1,410 TV sets of  RM238K each  in 168 locations. Just produce more programmes and broadcast through its controlled media (and replacing the air time set aside  for propaganda with proper rakyat-friendly heath programmes). We tax payers certainly can make better use with RM400 million, like patching up the horrendous roads in Wangsa Maju or build 8,000 units of affordable homes at RM50,000 a unit for example.
 And we have not examine which company is going to supply the TV set via direct negotiation or otherwise.

Strand Aerospace Malaysia Sdn Bhd
Of all the projects, this sound most promising – 6,000 Malaysian engineers to be trained in a joint venture company set up by Malaysian entrepreneurs and a British aerospace expert Anthony Bedborough, reach GNI impact of RM3.5 billion by 2020.
However, I wonder if this is a private sector initiative or it is a BN administration driven effort? Is SAM Sdn Bhd a GLC hence the Prime Minister can claim “lagi satu projek Barisan Nasional” or is it just a private sector investment?
One consistent trend in Najib administration is the confusion whether an investment project is really a BN administration project or a private sector going on anyway. For example, Najib presented investments by oil giant Shell as if it’s BN administration thingy. 

At the same time, Najib said Shell Malaysia will also be investing RM1.5 billion in multiple projects to upgrade, expand or build facilities in upstream, midstream and downstream activities across Malaysia.
While he is so good at playing the role of Shell Malaysia’s press officer, how come, for consistency sake, he did not announce the multi million investment in Kuantan by Lynas which was granted a 12 year pioneer status (as disclosed by Lynas themselves) when the maximum tax exemption period for promoted activities of national strategic importance is only 10 years?
Or the multi million contract awarded to Ahmad Zaki,Kejuruteraan  Kenari and Maya Maju consisting of RM400 million original allocation and R400 million overrun?
The new Istana Negara in Jalan Duta will now cost more than RM800 million, and not RM400 million as announced by the government in 2006.
Deputy Works Minister Datuk Yong Khoon Seng said the cost includes the construction of a new RM130 million flyover leading to the palace in Jalan Duta, and upgrading works on Jalan Changkat Semantan costing RM32.5 million.
He added that the flyover project and the road upgrading works were awarded to Ahmad Zaki Resources and Kejuruteraan Kenari respectively through direct negotiation.
The Istana Negara complex itself will cost around RM650 million and the project was awarded to Maya Maju, also through direct negotiation. The palace will be completed by February next year.
As for the projected GNI of RM3.5 billion anticipated in 9 years time, how much revenue the SAM Sdn Bhd need to earn to hit the target?
Since it averages about RM2 to RM4 million ringgit a year (reading the report below), SAM Sdn Bhd has a big gap to catch, making me wonder if they can actually hit the required number and I would be most interested to know of their business plan to accomplish this.
Making sure planes can take the stress
by Aznita Ahmad Pharmy on Sunday, 02 May 2010 16:00
Strand Aerospace’s work with Airbus over the past four years is worth around RM4 million to RM5 million. To make sure engineers at Strand Aerospace can handle working for big-time clients like Airbus, the company invested a lot in training.
For its FY2009 ended May 31, Strand Aerospace notched up RM2 million in revenue. Naguib says the amount was small due to the  company’s new graduate training programme as well as the exchange rate as most of its contracts are quoted in pound sterling.
By the way, I visited Anthony Bedborough’s website for U.K. operations but it seems that there is no adequate disclosure of its financial performance e.g. size of revenue and profit before tax, usually easily available from listed companies, to gauge if the UK joint venture partner itself is a multi billon ringgit operations that could push SAM Sdn Bhd towards the Najib promised land.

Doorstep Retail Sdn Bhd
I actually quite like DR’s message and concept explained in its website.
Doorstep Retails comprises of experts specialising in Retail, Logistics, IT and Telecommunications….
…. Corporate sectors can enjoy a wide array of office pantry supplies and our fellow consumers can feast their eyes on our household grocery supplies, from beverages to dry food and household products down to other daily necessities. As of 2011,we have expanded  into supplying the lifestyle products and offer catering services. We provide double convenience to our customers by bringing together everything you need under one roof.
 As our tagline suggests, Clearly the better way to shop, we at Doorstep strive to understand your needs as we would like your life to be stress free enabling you to focus on the more important things in life. Doorstep gives you the luxury of doing your shopping anytime, anywhere without the agony of being stuck in traffic, wasting precious time waiting in queues,  going through the endless battle of looking for parking and the torment of lugging those heavy bags.”
It will help us with our shopping but what exactly does the PM mean when it is announced that this outfit will “provide a platform of convenience for SME in terms of technical support or facilities.”
Doorstep Retails Sdn Bhd seems to be a retailer that accords convenience to shoppers, so I am puzzled with the kind of “technical support or facilities” to SMEs the prime minister is talking about – is DR going to be a supplier of cloud computing, market research, IT and consultancy, integrated  high tech warehousing and distribution services, global procurement facilitator or someone like alibaba.com or paypal that provide e-commerce platform to link sellers and consumers?
Then again, if DR does expand into such high tech support business then it should also be a private sector initiative, and not some investment by the BN administration, right?

DSEM Holdings Berhad
The prime minister announced this private initiative would have GNI impact of RM300million over 8 years’ time; that is about RM38 million a year. It is a good thing but does it warrant such emphasis by the Prime Minister as a matter of national strategic importance? Do you ever see Obama or Brush running to the podium and announced Steve Jobs or Bill Gates installed a new production facility?
 8 years is a long time in technology nowadays (imagine your computer’s / handphone’s capability 8 years ago) hence I wonder of LED would still be the hottest items then. DSEM Holdings Berhad should keep up with the latest technology and not get tied down by this promise made in 2011, come 2020.

Given the time span of the above NKRA self praise, I would be cautious with a politician’s promise. Mahathir promised Malaysians Wawasan 2020 and by 2010, Idris Jala announced that by 2019 Malaysia could be bankrupt, and the paradise of national harmony listed as one of the key ambition in Wawasan 2020, is soundly vindicated by the Perkasa, church bombing, al-kitab tussle, BTN courses, Balik Cina, Indian beggars and Chinese prostitue slander, body grabbing, temple destruction, church raiding, reality of today.

1 comment:

  1. Sometimes I wonder why I bother paying taxes. My hard earn money going into RM238,687.94 a pop TV set and health programs that nobody watches because it will be 1Malaysia standard. As the BN monster nears the end of its rule, the pillaging is becoming more and more brazen.