Philosophy Politics Economics

Posted by : Unknown | Khamis, 10 Februari 2011 | Published in

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Philosophy Politics Economics

OPVs, LCS and What Have You

Posted: 10 Feb 2011 03:41 AM PST

First of all, I'd like to express my thanks to Navy Chief Admiral Tan Sri Abdul Aziz Jaafar for taking the effort to make clarifications to my queries raised in my earlier press statement which were directed to the Minister of Defence.

1. Points of fact – OPV or LCS?

a. My statement on 7 Feb 2011 on this issue was responding to the statement made by Defence Minister Datuk Seri Dr Ahmad Zahid Hamidi on the government agreeing to allocate RM6 billion to build 6 "patrol vessels" as reported by Bernama on 5 Feb 2011.

It was only in yesterday's press conference that Tan Sri Abdul Aziz Jaafar or the Navy or Ministry of Defence for that matter, made reference to the specific term "Littoral Combat Ships" or LCS.

I have been accused in the Internet, on blogs and twitter that I can't tell the difference between a "sampan" from a "speedboat". Perhaps these criticisms, if valid, should be directed at the Minister of Defence himself, unless of course, Bernama misquoted the Minister.

b. However, more amusingly perhaps, Offshore Patrol Vessels (OPVs) are a broad class of ships above 700 to approximately 2000 tons used for mixed purposes such as fishery protection, pollution control, fire-fighting, search and rescue, humanitarian operations, EEZ patrol and wartime deployment. Such ships built to wartime requirements are sometimes referred to as "corvettes".

LCS on the other hand specialised variant of combat ship designed in the United States, which is arguably the "high-end" model of OPVs. The USS Independence, which is 1 of the 2 LCS in the US is 127m long, weighs 2,176 tons and has a speed of 44 knots. Our current Kedah-class OPV for example, is 91m long, weighs 1,650 tons and has a speed of 22 knots. "Littoral", in layman's term means "close to shore".

Hence the question isn't "OPV or LCS?" – but "what type of OPV is the navy buying?".

2. Point of fact – The Price of Ships

a. Questions were raised as to the accuracy and relevance of the prices of OPVs which I had quoted in my earlier statement. For example, again according to Bernama, Tan Sri Abdul Aziz Jaafar claimed that my figure of NZ$90 million (RM210m) for each of New Zealand's recent purchase 2 OPVs was incorrect as the New Zealand's Ministry of Defence website claimed the cost isn't finalised.

Attempting to split hairs over the NZ$90 million figure is however a pointless exercise. The figure is an estimate as at December 2010 for ships which have already been delivered and commissioned in the middle of 2010. Hence even if one were to allow for a generous 10% variance, it'll still be priced only at RM231m, and a far cry from the Royal Malaysian Navy's RM1 billion per ship.

My point isn't whether New Zealand bought its ships for NZ$90m or NZ$99m. My point was that the price range for different types of OPVs is huge, from US$34m (RM103m) to US$300m (RM913m) or more. Hence the question I asked per my earlier statement:

"The obvious question then, is whether the Government is procuring the construction of OPVs nearer the Irish Roisin class or closer to the US LCS? And if we are indeed making an order for the best-in-class LCS type ships capable of fighting a full scale surface and submarine warfare, does Boustead even have the skills and technology to make these ships?"

3. The Point

I'll be the first to admit that I'm not a military man nor am I as knowledgeable as many of the military analysts and self-confessed military enthusiasts out there. I'll also raise my hands to say that I'll have tonnes to learn from our Chief Admiral in terms of military expertise. At the same time, I'm also not questioning the Navy's need for additional ships.

But the indisputable fact of the matter is the price gap between the lower-end OPVs and the top-of-its-class models is huge. Datuk Seri Zahid Hamidi's statement of a RM6 billion purchase of 6 patrol vessels was vague and required detailed clarification. And it is our duty as parliamentarians to ensure that the tax-payers' receive the value for their buck.

From the reports on the Chief Admiral's press conference yesterday, I've to hear the additional specifications which make our ships being priced substantially higher than that paid for by New Zealand. For example, will our "LCS" be in the similar class as the American "LCS" in terms of armament for surface to air, surface to surface and anti-submarine warfare? The features of these ships such as the types and quantities of guns, electronic warfare and decoys, speed, sensors and processing systems are no secrets and are widely published in various defence magazines.

Hence, we MPs from Pakatan Rakyat are more than happy to accept the gracious offer by the Chief Admiral to meet him in person and be "educated" on the RM6 billion transaction.

NEM No More?

Posted: 10 Feb 2011 01:41 AM PST

A confluence of criticisms by a member of the National Economic Action Council (NEAC), a former Minister and the former US Ambassador to Malaysia, together with an announcement by the Prime Minister, Datuk Seri Najib Abdul Razak himself have confirmed the death and irrelevance of the New Economic Model (NEM). Instead, the Government has chosen to extend the lifespan of the New Economic Policy (NEP) with no expiry date in sight.

Reluctant NEAC member Datuk Dr Zainal Aznam Mohd Yusof argued that Najib's administration has "insufficient political will" to implement the required reforms, and this has resulted in the canning of proposals such as the "Equal Opportunities Commission (EOC)".

Similarly, the NEM Part II which was intentionally "watered down" reintroduced the NEP's 30% bumiputera equity target, which was originally rescinded in NEM Part I. Instead the NEM Part I had proposed the "deliberate shifting of affirmative action towards moving down to the bottom 40 per cent."

Datuk Dr Zainal also added that the appointment of Tan Sri Mohd Isa Samad as the chairman of FELDA with his "track record of graft had raised alarm bells. It was a sad day when Isa was appointed chairperson of Felda."

At the same conference, former Tourism, Arts and Culture Minister Datuk Seri Abdul Kadir Sheikh Fadzir also lamented that "if the founding fathers could see what is happening now, they will turn in their graves. Corruption is everywhere, you have to bribe people to get things done. Cronyism is everywhere."

In a reference to Najib's plans such as the NEM, GTP, ETP etc., he added that "there are beautiful statements (made), but they do not reflect the real state of affairs."

Similarly, former ambassador to Malaysia, Mr John Mallot wrote in his Wall Street Journal column that "although Mr Najib held out the hope of change a year ago with his New Economic Model, which promised an 'inclusive' affirmative action policy that would be, in Mr. Najib's words, 'market friendly, merit-based, transparent and needs-based,' he has failed to follow through."

What is perhaps most damning for the NEM is Mr Mallot's prognosis that Malaysians "will continue to vote with their feet and take their money and talents with them. And foreign investors, concerned about racial instability and the absence of meaningful economic reform, will continue to look elsewhere to do business".

The Prime Minister himself, has chosen the very same day to hold a "Bumiputera Agenda Supreme Council" meeting and announcing the setting up of "Unit Peneraju Agenda Bumiputera" to drive and co-ordinate bumiputera economic participation. This confirms the criticisms that Najib is placing the race agenda above the original intention of the NEM, which was to steer affirmative action programmes towards the bottom 40% of income earners of the population.

Najib is now proving to be a failed reformer, with his much vaunted "Najibnomics" turning out to be nothing more than an endorsement of the controversial NEP which favours the influential elite and a copycat of Mahathir's mega-projects and privatisation policies of the 1990s.

The concerns raised in the Government Transformation Programme (GTP) and the NEM Part I on the NEP increasing the income disparity between the rich and poor, the sense of discrimination dissatisfaction between races as well as the resulting brain drain will only worsen as a result. While the major infrastructural spending spree will lead to short term stimulation of the economy as happened in the 1990s, history will only repeat itself as we suffered a decade of real income stagnation and falling competitiveness in the 2000s.

It is most unfortunate that the Prime Minister has chosen to pander to vested political interest of race-based extremists groups such as Perkasa, and forsake his opportunity to make his mark by embarking on genuine reforms on Government policies which will reverse the decline in our economic competitiveness.

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