The corporate rationalisation for a political solution

Dato’ Johari Abdul Ghani

It is quite unorthodox that a corporate rational and thought process is the most likely solution to address a political conundrum, especially complex variables are factored into the political equation.

This posting is the extension on the rational why MP for Titiwangsa Dato’ Johari Abdul Ghani is our choice for the post of Minister of Defence, if and when Prime Minister Dato’ Sri Mohd. Najib Tun Razak decides to have a Cabinet reshuffle. The Cabinet reshuffle is deemed timely because of the half electoral term just over for the Parliament XIII.

The position of the Minister of Defence possess different challenges today against what it was when Tunku Abdul Rahman Al Haj formed his first Cabinet. Again the whole of the 1960s, through the geo-political complexity as Malaya still faces the communist rebellion threat and later when Malaysia was formed, the threat from Indonesia.

The 70s, 80s, 90s and the first decade of 21st century have their own challenges and demands from the Ministry of Defence (MoD). The Cabinet Minister in charge had to balance between policy, expansion plan, doctrine, acquisition implementation, operational status and moral of the personnel and most of all, budget.

Now in the second half of the second decade of the 21st century, the challenges and demands in MoD is even more complex and layered. Getting the balance between policy, expansion plan, doctrine, acquisition implementation, operational status and moral of the personnel got to be extrapolated to the geo-political scenario and Malaysia’s own foreign policy.

The requirements for more assets, operational capability and peace-time secondary operation such as in crisis and emergency in the likes of the missing MH370, kidnapings and hijackings on and off the coast, disaster relieve such as the Great Flood of December 2014 and the Kinabalu Earthquake, compounded to the already long list of ‘must haves’.

Just for size, let us throw in some issues that are already pressing if not critical to be addressed.

1. The replacement program for the RMAF MiG-29Ns interceptors (which is over 22 years old in service)

2. The replacement program for the RMAF F/A-18Ds multirole combat aircraft (which is 18 years old in service)

3. The replacement program for the RMAF S61 Nuris (which is over 47 years old in service – original )

4. The replacement program for Laksmana Class corvettes (Which age is actually 31 years old but in service with RMN since 1999)

5. The upgrade of the RMAF C130H Hercules transporters

6. The new generation RMN Gowind Class littoral combat ships

7. The continuation of the RMN NGPV Kedah Class program

8. The additional requirement for the RMAF A400M multirole strategic transport aircrafts (on order is only four)

9. The additional requirement for the RMAF EC725 Cougar utility helicopters (on order is only twelve)

10. The maritime/anti submarine patrol aircraft programs

11. The Airborne Warning and Control System (AWACS) aircraft programs

The non traditional threats for Malaysia should be  taken into the consideration, where Malaysia is a maritime nation. Factors such as the 4,675km coast line and mass body of water between Peninsula and Sarawak and Sabah and the EEZ of 200 nautical miles as per the UNCLOS, requires a strong armed forces to ensure the interest of the nation is protected.

The patrol, surveillance, protection of this important element for the Federation is pertinent, as this mass body of water is where a major portion of food and hydrocarbon is extracted. The water ways around the nation is the important component of the nation’s trade.

The seas also provide revenue from tourism.

Hence, to ensure all the requirements are being addressed and met, the nation has got to provide the necessary investment for the acquisition, development, operation and maintenance of all these said programs.

All of these programs require huge sums of funds. For size, the Gowind program alone for six vessels and combat systems which would be undertaken by Boustead Heavy Industries is expected to cost slightly less than RM11 billion.

In aggregate, to have all these programs delivered require a lot money and in the challenges of the fiscal management by Treasury, it is deemed that it is impossible it could be funded from the conventional means.

Hence, to be able to deliver all these requirements and acquire all these assets, innovative ways are the solution. Solution like deals and packages made through extended sophisticated commercial programs, would be the avenue for these assets to the acquired and MoD requirements met.

That is where Dato’ Johari Abdul Ghani comes in. He is a chartered accountant with vast corporate experience. Taking over and restructuring plcs and later expand its operation and increase the market capitalisation was part of his illustrious track record as a corporate leader.

Hence, someone like him would expected to posses the ability to strategise and package deals between the Federal Government, GLCs, OEMs and the long term contracts for the consideration.

The acquisition of these assets could be realised the hybrid of constructing under license and with partners of friendly nations that have similar acquisition, in the effort to lower the cost of economies. The package of maintenance, repair and overhaul could also be factored.

All these costs could be aggregated and spread over a long period, to provide the affordability for these assets and programs to be acquired by MoD. Perhaps, some of the GLCs could be mobilised to provide some of the financial commitment for these programs to materialise.

After all, it is for national service and defence of the realm.

On top of that, an experienced corporate man should be able to restructure and make the armed forces more effective with its current complement and strength, where all resources are optimised.

That is the rational why an experience corporate man should be appointed as the next Minister of Defence.

Published in: on June 25, 2015 at 14:30  Comments (12)