Malaysia's flight MH370 mistakes reflect stagnant politics; Bad apples in NZ sex crime.

Malaysia is poised to escape the middle-income trap, but also ready to fall back into it.

Normally the middle-income trap refers to countries with per capita GDP ranging from $1,000 to $12,000. GDP per capita in Malaysia already reached $1,000 by 1977, and $11,000 by 2013. After ups and downs over almost four decades, it seems Malaysia could walk out of the middle-income trap very soon.

Nonetheless, according to the Asian Development Bank that created the concept, GDP per capita is only a superficial indicator. The more accurate definition of the middle-income trap is that when a country enters the ranks of middle-income countries, a series of problems emerge, including rising labor costs, a lack of technological innovation, and subsequent economic stagnation.

There are two aspects of the definition: rising productivity and good governance. The essence of governance here means encouraging reasonable competition to maximize the value of talent and give boost to innovation.

Malaysia's poor response following the disappearance of flight MH370 reflected the fact that the country is still way behind in terms of governance. Behind the chaotic information are the flaws in Malaysia's system of governance.

There are both systematic and cultural reasons behind Malaysia's poor governance. But it is more related to the lack of secularization.

One driving force in the rise of Malaysia's GDP per capita has been the export of abundant raw products such as oil and rubber.

Malaysia is a multi-ethnic country, with Malays making up 68 percent of the population, Chinese 24.6 percent, and Indians 7 percent. According to the law, Chinese Malaysians, who were historically dominant in the economy despite their smaller numbers, cannot take positions as top leaders; and Malays must make up two-thirds of ministers and parliamentary members, and three-fourths of civil servants.

Malays also enjoy special policies in other fields such as college admission and civil servant recruitment. Malays even enjoy a higher quota in the issuing of taxi operation licenses.

Some Malays simply acquire the licenses and rent them to Chinese, collecting unearned income.

This rigid system which shows special care for Malays, to a certain extent, helps different ethnic groups to stay in their own places and thus boosts social stability. But this also closes the channel for upward mobility because it fails to provide a reasonable platform for competition.

The special privileges enjoyed by Malays give leeway for corruption. And in terms of governance, these privileges translate into a conservative group with vested interests and a lack of talent.

The modernization of Malaysia's governance is also related to Islamic modernization.

In 2001, then prime minister Mahathir Mohamad announced that Malaysia was a Muslim country. Current Prime Minister Najib Razak also declared in 2007 that Malaysia has never been a secular country.

Even today, some states in Malaysia still maintain elements of Sharia law. Different religious populations have different civil laws, even when living in the same place.

Islam is not a negative element. However, integrating religion with the law and politics rather than separating them may cause social conservatism and isolation.

In fact, this is a misinterpretation that sees Malaysian politics as strictly controlled by the elite. What's dysfunctional is not elite politics itself, but a rigid, dull system that is responsible for selecting the political elite.

Malaysia is determined to enter the ranks of developed countries by 2020. But judging from its handling of the MH370 incident, Malaysia's modernization will take far longer than this.

Source: By Ding Gang Source:Global Times Published: 2014-3-19

Bad apples -Malaysian envoy in NZ sex crime 

Read more at: http://english.astroawani.com/news/show/malaysian-envoy-in-nz-sex-crime-named-38804?cp

A photo of the Malaysian High Commission in Wellington, New Zealand.

KUALA LUMPUR: The Malaysian diplomat who is at the centre of an alleged sexual assault case in New Zealand has been identified as Muhammad Rizalman Ismail.

His identity was allowed to be revealed after media organisations challenged a judge's decision to grant permanent name suppression, The New Zealand Herald reported today.

The identity of Muhammad Rizalman, 38, who worked at the Malaysian High Commission in Wellington, was previously concealed due to a immunity order imposed by a Wellington District Court judge on May 30.

However, the High Court at Wellington today held an emergency hearing to overturn the immunityruling and it was successful.

Meanwhile, the Malaysian Foreign Affairs Ministry said it will not waive Muhammad Rizalman's diplomatic immunity just yet. But they are prepared to do so, if necessary, so that the suspect can be prosecuted under the New Zealand law, its Minister Datuk Seri Anifah Aman said.

He said the Malaysian government is committed in ensuring the transparency of the investigation of this case.

"If it is absolutely necessary that we think it is best to (waive his immunity) we will do it without hesitation," he told a press conference in Wisma Putra here today.

Anifah also said, the Malaysian government has confidence with the Defence Ministry's (Mindef) board of inquiry (BOI) that they will communicate with the New Zealand authorities, adding that they will not hesitate to take stern action against the suspect.

"Mindef will not hesitate to act under the Armed Forces Act 1972, if it is proven beyond doubt that Muhammad Rizalman is responsible and guilty of the offense as charged," he said.

He said the waiver would be deemed necessary when New Zealand requested for Muhammad Rizalman's return, out of belief that the investigations in Malaysia were not done properly.

However, he informed that it was the New Zealand authorities who had allowed the man to be brought back to Malaysia in May.

Besides that, Muhammad Rizalman has also undergone medical checks at the Mindef Medical Centre on May 29 which include physical and mental tests.

Anifah said blood and urine tests were also conducted and the results were satisfactory. Muhammad Rizalman is now at the Tuanku Mizan Military Hospital to have his mental and emotional health assessed.

On the Malaysian High Commission's website in New Zealand, Muhammad Rizalman, who had previously claimed diplomatic immunity, is listed to be Defence staff assistant, with the rank of a warrant officer II.

The man was arrested after he allegedly followed a 21-year-old woman to her house on May 9 and attacked her.

Sources: Astro/The Star/Asia News Network

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Global bank profits hit US$920bil, China accounted for 1/3 total; Globalized RMB to stabilize world economy

LONDON: China's top banks accounted for almost one-third of a record US$920 billion of profits made by the world's top 1000 banks last year, showing their rise in power since the financial crisis, a survey showed on Monday.

China's banks made $292 billion in aggregate pretax profit last year, or 32 percent of the industry's global earnings, according to The Banker magazine's annual rankings of the profits and capital strength of the world's biggest 1,000 banks.

Last year's global profits were up 23 percent from the previous year to their highest ever level, led by profits of $55 billion at Industrial and Commercial Bank of China (ICBC). China Construction Bank, Agriculture Bank of China and Bank of China filled the top four positions.

Banks in the United States made aggregate profits of $183 billion, or 20 percent of the global tally, led by Wells Fargo's earnings of $32 billion.

Banks in the eurozone contributed just 3 percent to the global profit pool, down from 25 percent before the 2008 financial crisis, the study showed. Italian banks lost $35 billion in aggregate last year, the worst performance by any country.

Banks in Japan made $64 billion of profit last year, or 7 percent of the global total, followed by banks in Canada, France and Australia ($39 billion in each country), Brazil ($26 billion) and Britain ($22 billion),The Banker said.

The magazine said ICBC kept its position as the world's strongest bank, based on how much capital they hold - which reflects their ability to lend on a large scale and endure shocks.

China Construction Bank jumped to second from fifth in the rankings of strength and was followed by JPMorgan , Bank of America and HSBC .

ICBC, which took the top position last year for the first time, was one of four Chinese banks in the latest top 10.

Wells Fargo has this year jumped to become the world's biggest bank by market value, after a surge in its share price on the back of sustained earnings growth. Its market value is $275 billion, about $75 billion more than ICBC.

The Banker said African banks made the highest returns on capital last year of 24 percent - double the average in the rest of the world and six times the average return of 4 percent at European lenders.- Reuters

Globalized RMB to stabilize world economy

BEIJING, June 27 (Xinhua) -- The globalization of the yuan, or renminbi (RMB), will not only benefit the Chinese economy, but generate global economic stability, a senior banker has said.

The yuan did not depreciate during the 1997 Asian financial crisis or the 2008 global financial crisis, helping stabilize the global economy, Tian Guoli, chairman of the Bank of China, said at a forum in London last week, according to the Friday edition of the People's Daily.

China's economy ranks second in the world and its trade ranks first, so it is thought that use of the RMB in cross-border trade will be a mutually beneficial move for China and its trade partners.

The yuan has acquired basic conditions to become an international currency as China's gross domestic product took 12.4 percent of the world's total and its foreign trade 11.4 percent of the world's total in 2013, Tian said.

According to the central bank, RMB flow from China hit 340 billion yuan (55.74 billion U.S. dollars) in the first quarter of 2014, replenishing offshore RMB fluidity. The balance of offshore RMB deposits hit 2.4 trillion yuan at the end of March, 1.51 percent of all global offshore deposits. Offshore trade between the yuan and foreign currencies doubled in the first quarter from the fourth quarter of last year.

Analysts widely forecast five steps in RMB internationalization: RMB used and circulated overseas, RMB as a currency of account in trade, RMB used in trade settlement, RMB as a currency for fundraising and investment, and RMB as a global reserve currency.

Already, some neighboring countries and certain regions in developed countries are circulating RMB, indicating the first step has been basically achieved.

Data provider SWIFT's RMB tracker showed that in May, 1.47 percent of global payments were in RMB, a tiny amount compared to the global total but up from 1.43 percent in April. This indicated progress in the second and third steps.

Some countries in southeast Asia, Latin America and Africa have or are ready to take RMB as an official reserve currency. It indicated the fourth and the fifth steps are burgeoning.

Investors are also optimistic about RMB globalization. Bank of China's global customer survey shows that over half of the respondents expect RMB cross-border transactions to rise by 20 to 30 percent in five years. And 61 percent of overseas customers say they plan to use or increase use of RMB as a settlement currency.

Li Daokui, head of the Center for China in the World Economy under Tsinghua University, said RMB internationalization is a long-term process and should be made gradually based on China's financial reforms, including freeing interests and reforms on foreign exchange rates.

Dai Xianglong, former central bank governor of China, forecast that it will take about 10 to 15 years to achieve a high standard of RMB internationalization.

Among the latest moves toward RMB internationalization is the naming of two clearing banks to handle RMB business overseas.

The central bank announced last Wednesday that it has authorized China Construction Bank to be the clearing bank for RMB business in London, and the next day named the Bank of China as clearing bank for RMB business in Frankfurt.- Xindua

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China wants strong defense; Never seek hegemony on 5 Principles of Peaceful Coexistence; Japan, Philippines using rule of law pretext

Xi Jinping stresses building strong frontier defense

Senior Chinese leaders Xi Jinping, Li Keqiang and Zhang Gaoli meet with representatives attending a national meeting on frontier and coast defense in Beijing, China, June 27, 2014. (Xinhua/Li Gang)

BEIJING, June 28 (Xinhua) -- Chinese President Xi Jinping called for efforts to build a strong and solid frontier defense network for both territorial land and water at a national meeting held here on Friday.

Xi said, upon mentioning frontier defense, one cannot help thinking China's modern history when the country was so weak and destitute that it was for everyone to bully.

Foreign aggressors broke China's land and sea defense for hundreds of times, plunging the Chinese nation into the abysm of calamity, Xi added, calling on the people not to forget the history of humiliation and to build a strong frontier.

Xi urged China's frontier defenders to meticulously monitor over and control the frontier and to mount actions to defend the country's maritime right, while implementing an overall national security outlook.

Furthermore, Xi called for efforts from both the military and civilian communities to strike a balance between frontier defense and economic development, staunchly safeguarding frontier security, stability and prosperity.

Premier Li Keqiang and Vice Premier Zhang Gaoli also attended the meeting. - Xindua

Xi pledges China will never seek hegemony

President re-affirms vow at meeting with leaders of Peaceful Coexistence doctrine's founding countries

Chinese President Xi Jinping on Saturday delivered a keynote speech at a commemoration marking the 60th anniversary of the Five Principles of Peaceful Coexistence at the Great Hall of the People in Beijing.[Photo/Xinhua]

Chinese President Xi Jinping (front row C), Myanmar President U Thein Sein (front row 4th L) and Indian Vice President Mohammad Hamid Ansari (front row 4th R) together with delegates from China, India and Myanmar attending a conference marking the 60th anniversary of the Five Principles of Peaceful Coexistence pose for a group picture during their meeting in Beijing, capital of China, June 28, 2013. [Photo/Xinhua]

China will never seek hegemony, no matter how strong it becomes, President Xi Jinping said on Saturday at a high-profile meeting to mark the 60th anniversary of the Five Principles of Peaceful Coexistence.

"China does not accept the logic that a strong country is bound to become hegemonic, and neither hegemony nor militarism is in the Chinese DNA," Xi said in a speech, as he played host to leaders from Myanmar and India to commemorate the anniversary.

Citing poems and old sayings from the three countries, Xi called for dialogue based on equality to resolve disputes and joint efforts to preserve regional peace.

He also announced the establishment of a friendship award and an outstanding scholarship related to the Five Principles of Peaceful Coexistence. 

Myanmar leader hails ties

Observers said Xi's remarks and the first meeting of leaders of all three of the peace code's founding countries since its inception sought to assure the world of China's peaceful development amid simmering tension in the East and South China seas.

It will take time for China, or any growing power, to be fully accepted by the world. But China will prove its intentions with its actions, based on the five principles, which can play a bigger role in the current international community, they added.

In 1954, the leaders of China, India and Myanmar initiated the Five Principles of Peaceful Coexistence. They are mutual respect for sovereignty and territorial integrity; mutual non-aggression; non-interference in each other's internal affairs; equality and mutual benefit; and peaceful coexistence.

The joint commemoration - especially the presence of Myanmar's President U Thein Sein and India's Vice-President Mohammad Hamid Ansari - shows those two countries' efforts to push forward the peace code and their relationship with China, said Zhang Jiuhuan, former director of the Department of Asian Affairs at the Foreign Ministry.

Having guided the rapid development of ties between China and Southeast Asia, the principles could also lead to the resolution of issues between China and some Southeast Asian countries in the South China Sea, said Zhang, who is also a former Chinese ambassador to Singapore and Thailand.

Wang Fan, vice-president of China Foreign Affairs University, said the five principles could be developed to become a mechanism to guarantee the spirit's future implementation.

East Asia - divided by an outdated alliance system - lacks a sound multilateral platform for cooperation. So the five principles under a mechanism could better restrict all concerned parties, he said.

Ansari also called for "a new paradigm for global action", "a framework in which opportunities and challenges for the betterment of our societies coexist".

The five principles "can act as a catalyst", he said in a speech at the meeting.

By Zhao Shengnan (China Daily)

Japan, Philippines using rule of law pretext

BEIJING, June 27 -- A spokesman for China's Foreign Ministry said on Friday said Japan and the Philippines have infringed on other countries' interests under the pretext of rule of law.

"Some countries are provoking and stirring up tensions on the one hand and vilifying other countries under the pretext of rule of law," Qin Gang said at a daily press briefing.

Qin's comments came after Philippine President Benigno Aquino and Japanese Prime Minister Shinzo Abe on Tuesday called for use of "the rule of law" to solve regional disputes, at a time when both countries are embroiled in separate rows with China.

Qin said China has always been committed to working with relevant countries and resolving the disputes on the basis of historical facts and international laws.

He also said China does not accept the international arbitration put forward by some countries, not because it is afraid to do so. The country is only "exercising the legitimate rights of signatories to the UN Convention on the Law of the Sea."

In early June, the Permanent Court of Arbitration asked China to submit evidence on its territorial claims in the South China Sea within six months for a procedural review of the suit filed by the Philippines.

China aims to properly resolve issues and protect regional peace and stability, which is also in line with the Declaration on the Conduct of Parties in the South China Sea , according to Qin.

"Some countries have infringed on the legitimate interests of other countries under the pretext of rule of law," he added, urging Japan and the Philippines to reflect on their acts in accordance with international laws and the norms guiding international relations.

(Xinhua)AFP

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US may repeat same inept blunders that caused lasting Iraq disaster : ISIS, WMD lies!

The deepening crisis in Iraq is a result of mistakes of US Middle East policy under two presidents. Washington does not learn from mistakes, so tensions inevitably will rise in the already disintegrating region.

 WMD lies
The regime change war of the George W. Bush administration against Iraq was arguably the greatest strategic mistake in US history. The consequences continue to unfold.

The Obama administration added fuel to the regional fire by launching the regime change wars against Libya and Syria. The flow of weapons and terrorists links these struggles.

The US public was outraged that the Obama administration considered a direct attack against Syria. The public today is becoming increasingly concerned about US involvement in yet another unnecessary Iraq war.

The present situation in Iraq must be placed in historic context. The British created the country after WWI from three former Ottoman provinces. The British strategic concept involved moving oil from the northern area of Mosul to Haifa in Palestine to be refined and then service the navy in the Mediterranean. Oil from the southern area of Basra was refined to service the navy in the Persian Gulf.

The northern area is one home of the Kurds, who are an ancient non-Arab ethnic group. The central area is traditionally the home of Sunni Arabs while the southern area is traditionally the home of Shiite Arabs.

The possibility of a breakup of this artificial state has always been present as the Kurds seek independence and the Shiite Arabs have religious ties to Iran. An Iraqi national identity was mostly held by secular political forces in the past.

In the aftermath of the war, the US dismantled the ruling Ba'ath political party, which ran the government apparatus. It also destroyed the Iraqi army. These two moves undermined national unity and stability in the post-war period.

The Obama regime change war against Syria has now morphed into a complex mess involving both Syria and Iraq. This explosive situation in turn threatens Jordan and Lebanon.

 ISIS in Iraq
The Islamic State in Iraq and Syria (ISIS) terrorist group with its many foreign fighters is a powerful actor in the present situation. But it must also be said that various Iraqi groups are also involved. These include former Iraqi military, political, and religious networks dissatisfied with the present Shiite-dominated government.

When the US toppled Saddam Hussein, it was inevitable that the next regime would be dominated by the Shiites who are the majority in Iraq. Experts at that time warned against the war, arguing that with Saddam's fall, Iran would become influential in Iraq through Shiite politicians.

The Shiite-dominated Maliki government has been heavy handed toward Sunni Arabs and Kurds. This counterproductive behavior set the stage for the present crisis which has been exploited by outside forces such as Saudi Arabia and Gulf states. They financially and militarily support the extremist Sunni terrorist organizations attacking the Shiites.

Saudi Arabia and the Gulf states also support the US regime change war in Syria. Support by these states for Sunni terrorists is part of a larger plan to bring the region under Saudi dominance.

It is no secret in Washington that pro-Israel neoconservatives for decades have been plotting the balkanization of Syria and Iraq. They see this process as good for Israel because it would break up its hostile neighbors into less threatening enclaves.

The results of Washington's incompetence may well provoke Iran into action to protect the Shiites of Iraq. Washington and Tehran may or may not be able to agree on a path forward.

The disintegrating situation in Iraq puts great pressure on Jordan.

Because Jordan is a key ally in the region one would expect Washington to bolster Amman and this could involve military forces.

US politicians have forced war and chaos on the Middle East and have learned nothing. Will Washington's Asian pivot lead to similar results?

- By Clifford A. Kiracofe Source:Global Times Published: 2014-6-26
The author is an educator and former senior professional staff member of the Senate Committee on Foreign Relations. opinion@globaltimes.com.cn

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Ini Malaysia Boleh? MH370 was likely on autopilot; new search area announced

Australia said the search for MH370 has shifted further south and the aircraft is now believed to have been on autopilot before it disappeared.

“It is highly likely that the aircraft was on autopilot.

“Otherwise, it could not have followed the orderly path that has been identified through the satellite sightings,” said Deputy Prime Minister Warren Truss during a press conference in Canberra yesterday.

However, he said the investigators could not, and had not intended to, pinpoint the moment when the aircraft was put on autopilot.

“We know it was on autopilot during the critical phase of our tracking but it will be a matter for the Malaysia-based investigation team to look at precisely when it may have been put on autopilot,” said Truss, who also declined to comment on speculation about the pilot having flown the course on his simulator, pointing out that it was irrelevant to their task of finding the aircraft.

“I don’t really want to comment on areas which will probably be the responsibility of Malaysia and its investigators,” he said.

Truss said the Australian Transport Safety Bureau had released a report which outlined the basis for their conclusion that the new search area was the most likely place where the aircraft could be found.

He said the new priority search zone was 60,000sqkm, and was greatly expanded compared to the previous underwater search area of only 860sqkm.

“The new phase of the search will have two elements. Firstly there will be mapping of the sea floor in the area, which is already under way, and a comprehensive search once mapping had been completed,” he said.

Mapping is currently being undertaken by Chinese survey ship Zhu Kezhen and the Australian-contracted vessel Fugro Equator.

Truss said mapping of the very deep sea floor was expected to take about three months to complete, while the underwater search was expected to commence by August.

“To put new equipment into the area without a clear knowledge of what the sea floor is like will certainly put at risk the capacity of that equipment to operate safely,” he said.

Truss added that the search effort would include equipment provided by Malaysia, including vessels equipped with towed sonar systems.

Despite acknowledging the enormity of the task, Truss remains optimistic.

“The search is still going to be painstaking. Of course, we could be fortunate and find it in the first hour or the first day, but it could take another 12 months.”

The Star/Asia News Network 

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Missing Malaysian airliner 'likely on autopilot' as new search area announced

Australian Deputy Prime Minister Warren Truss points the new search area for MH370 to reporters at a press conference at Australian Parliament House in Canberra, June 26, 2014. Australian Deputy Prime Minister Warren Truss said on Thursday that it is "highly likely" the missing Malaysian airliner flew on autopilot until it ran out of fuel and crashed into the Indian Ocean. (Xinhua/Xu Haijing)

CANBERRA, June 26 (Xinhua) -- Australian Deputy Prime Minister Warren Truss said on Thursday that it is "highly likely" the missing Malaysian airliner flew on autopilot until it ran out of fuel and crashed into the Indian Ocean.

Truss made the comment on Thursday when announcing the joint search operation involving Australia, Malaysia and China would shift its focus in the southern Indian Ocean for Malaysia Airlines flight MH370.

The revised search area is based on the findings of an international satellite working group.
The group has reviewed all existing information to define a search zone of up to 60,000 square kilometers along the arc in the southern Indian Ocean.

Truss said the refined search area would still be focused on the seventh arc, where the aircraft last communicated with satellite.

But the search would shift to an area slightly further south along the arc, based on the calculations of the international experts.

"Specialists have analyzed satellite communications information- - information which was never initially intended to have the capability to track an aircraft -- and performed extremely complex calculations," Truss said.

"This site is the best available and most likely place where the aircraft is resting."

"It is highly, highly likely that the aircraft was on autopilot, otherwise it could not have followed the orderly path that has been identified through the satellite sightings," Truss said.

He said the search for MH370 was ongoing. A three-month mapping of the ocean floor in the search area is in progress and would be followed by a comprehensive search of the sea floor that is expected to begin in August and take up to 12 months to complete.

"The bathymetric survey has already commenced, with the Chinese survey ship Zhu Kezhen and the Australian-contracted vessel Fugro Equator conducting operations in the areas provided by the Australian Transport Safety Bureau," Truss said.

"The underwater search will aim to locate the aircraft and any evidence to assist with the Malaysian investigation of the disappearance of MH370."

"This area has never been comprehensively mapped previously and so to put new equipment down into that area without having clear knowledge of what the sea floor is like certainly risks the operation and the capacity of that equipment to operate safely."

He warned that the search will still be painstaking. "Of course we could be fortunate and find it in the first hour, or the first day, or it could take the next 12 months."

Australia, Malaysia and China have reaffirmed their commitment to continue to search for MH370 and to keep families informed of developments.

Truss said search nations owed it to "the passengers and the crew and everyone associated with MH370 to bring this mystery to a conclusion."

"I can assure all the families and those with an interest that Australia remains dedicated to the task of solving this greatest aviation mystery."

Flight MH370 vanished on March 8 with 239 people aboard, while en route from Kuala Lumpur to Beijing.

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KUALA LUMPUR, June 15 (Xinhua) -- The Malaysian government and the Malaysia Airlines (MAS) on Sunday reiterated their commitment to continuing the search operation for the missing MH370 flight as 100 days had passed since its disappearance on March 8. Full story

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