OCTOBER 11 — No one wins in any conflict; including, and especially, a trade conflict. Businesses disrupted are deep bottom lines lost. Potentially, forever. It is good that a middle and wise road is always chosen to offset any acrimony in the heat of the moment.
Tony Pua, the political secretary of the Minister of Finance Lim Guan Eng has published an open letter suggesting “the brazen attempt” of MMC-Gamuda to challenge the Ministry of Finance (MoF).
Within 24 hours, MMC Gamuda has responded by suggesting that they would “like to be invited to the negotiating table.”
Since Prime Minister Tun Dr Mahathir Mohamad has promised to look into the issue, especially the plight of the supposed “20,000” workers, the matter is now in his hand, and his Cabinet members.
However, MMC-Gamuda should know that the maximalist approach of confronting the MoF is loaded with risks.
First, Dr Mahathir and the cabinet of Pakatan Harapan, for the lack of better word, is determined to reduce the national debt of Malaysia; ideally from more than 82 per cent of the Gross Domestic Product (GDP) to around 37-35 per cent.
The latter is not cast in stone, as yet, but it was the gold standard set by Tun Dr Mahathir when he retired in October 2003.
Since 2003 marked the high water point of a smooth transition, which allowed Tun Abdullah Badawi and subsequently Datuk Seri Najib Razak to remain in office between 2004-2018 with relative ease, despite the huge financial cost to the Malaysian government, it goes without saying that for the Dr Mahathir and Anwar Ibrahim transition — which is a matter of national interest — to take place both the prime minister and his Cabinet have to "scrimp and save" as well. That cost reduction process has started in earnest in MoF.
MMC-Gamuda appears oblivious to the issue of national debt, which affects the livelihood of more than 32 million people with several generations to come, when its directors and employees appeared to focus on the prospective supposedly “20,000” job losses of the workers, even though the above ground projects of MMC-Gamuda are not cancelled.
However, MMC-Gamuda's latest stance, while conciliatory, can do better to further highlight its efforts to help the government overcome the high national debt, which affects the livelihood of more than 32 million people with several generations to come.
In fact, it is unwise of the directors and employees to focus on the prospective, “20,000 job losses” and “20,000 families” of the workers, as the above ground projects of MMC-Gamuda are not cancelled. Nor the entire MRT 2.
Since the MRT 2 projects above the ground can continue apace, the workers and families' best interest can indeed be accommodated too.
Secondly, MMC=Gamuda, which is a 50-50 joint venture, between Tan Sri Syed Mokhtar Al Bukhary and Gamuda — of which the latter was first founded by Tan Sri Koon Yew Yin in the mid 1970s — remain generous philanthrophists to this day. If they have worked well before, even now, with the MoF, there is no need to arm wrestle each other to the breaking point.
The “two Tan Sris” both before and after their forays into engineering projects have made it to the top of the food chain in Malaysia due to their willingness to “listen” to the Malaysian government based on “smart partnership.” And, the sound record of MMC-Gamuda is obvious to all.
The “smart tunnel” in Kuala Lumpur, for example, which can be converted into a flood mitigation programme, where excess water can be piped away from the over paved environment of Kuala Lumpur, invariably caused by a sudden storm surge, was completed during Dr Mahathir's first tenure.
If MMC-Gamuda was successful in getting both portions of the MRT2 project in its first tender — both above the ground and in the tunnel — such a feat must have been due to the existence of the “smart tunnel” too; which was a demonstration of Malaysian excellence, as documented in the National Geographic channel.
Thus, the directors of MMC-Gamuda, whose composition is not clear to the public as yet, would want to emulate the founding principles and spirits of the two Tan Sris.
Giving in to further deductions of the MRT2 project, is not an all round collapse, when such goodwill is often taken in kind, especially when the government is neck deep in national debt. An eye for an eye, as the world knows, does make the world go blind.
Neither the decision makers in MoF nor the directors of MMC-Gamuda want to be caught in this vise-like downward spiral. As Winston Churchill is known to have said, “jaw jaw is better than war war.” By asking the MoF to negotiate again, MMC-Gamuda seems to be taken this advice to heart.
In other words, do not go against the best practices of the current and past owners. Besides, it is not proper to go head-to-head with MoF, when neither Dr Mahathir nor Anwar are the likes to want to spite the nose to humiliate a long time private public partnership (PPP) entity.
Thirdly, if MMC-Gamuda cannot provide a further deduction of 23 per cent, when the cost over-run has hit RM56.9 billion, as reported by Bernama, this despite an original tender of some RM3 billion, then more research into the economic necessities of the other aspects of the MRT 2 project would be vital to overcome the logjam, rather than an international re-tender; a process which former owner Tan Sri Koon Yew Yin said is replete and fraught with risks for all sides.
Either the company has lost its efficiency, causing the cost to balloon, or, its engineering division has lost its prowess since the completion of the smart tunnel.
Irrespective of the reasons, it is good that MMC-Gamuda has now suggested an “open book” approach, too, where an independent engineering company could look into the nitty gritty of the whole process. This is an approach that appears agreeable to MoF too.
Granted that MMC-Gamuda appears to have the tunnel-boring technology — where Malaysian government appreciates and approves of — why not focus on taking a wise and moderate retreat from an all out head-butt with the MoF and vice versa.
After all, the geology and geography of Malaysia, where the East and West coast of Malaysia is separated by Banjaran Titiwangsa which juts out from the middle of the back of peninsular Malaysia, does require MMC-Gamuda to work with Malaysian government, rather than against it.
When MMC-Gamuda can think in such broad terms, even the hilly and tough terrain of Sabah and Sarawak, are the future oysters of their growth targets and infrastructure projects, as and when there are new international tenders.
Finally, MMC-Gamuda is a public listed company. By launching into a social media campaign at first, even urging the workers to sign up on change.org, which is a petition process that was first made famous by American actors like Angelina Jolie and Brad Pitt, the directors of MMC-Gamuda have skipped a vital process; they didn't call for an “extraordinary general meeting” (EGM) of all shareholders yet.
It also did not take into consideration the option of adapting to the new economy, where Grab can be the feeder systems to enhance mobility and ridership, as pointed out by Tony Pua.
To be sure, all romantic relationships and marriages can fall apart. But most don't, if they know how to navigate in between the hard rocks of tough decisions. In extraordinary times, there is a need for extraordinary courage, not just solutions.
Walking back is not a concession, just as Dr Mahathir has on more than one occasions been willing to do; such as relinquishing his interest to helm the portfolio of the Ministry of Education and (momentarily) suspending the ascession to the Comprehensive Trans Pacific Partnership Agreement (CPTPP). MMC-Gamuda can attempt a walk back with the new government of Pakatan Harapan in order to run ahead with Pakatan Harapan one day.
Public-listed companies, with strong record of doing well in the past, will do well again in the future — especially when the upcoming budget, to be delivered to the Parliament on November 6, is the first budget of Pakatan Harapan to “Save Malaysia.”
More importantly, MMC-Gamuda cannot fail to take notice that Datuk Seri Najib Razak has joined its media campaign too.
By backing it not to back down, Najib is setting a trap for MMC-Gamuda to ruin its relationship with the new government.
This is precisely what MMC-Gamuda should not do, as this would lead to a guilt by association. Indeed, with a former prime minister slapped with 35 charges of criminal breach of trust within five months after he has relinquished office, it would be best for MMC-Gamuda to stay away from Najib. Even all his Umno MPs have begun to keep their distance away from him.
MMC-Gamuda must not be used by Najib and Umno to make their comeback, precisely at a time when all Malaysians, including their “20,000 employees” do understand the risks of kleptocracy, since many have vouched to work hard to make a better Malaysia based on their comments in social media.
The solution(s)? Use arbitration and corporate diplomacy, invariably, wisdom to achieve a win-win solution with the Prime Minister Office, the Minister of Finance, and the Cabinet, indeed the people of Malaysia. Cut costs. Don't cut ties in any administration that is strong on PPP and smart partnership.
* This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.