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)  

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12 CommentsLeave a comment

  1. Who possesses advanced defence technologies at present?

    Besides the primus inter pares US, there is Russia, France, Britain, China, Japan, Germany and India. Not forgetting, of course, Israel.

    Then there is Iran, South Korea, Pakistan, Brazil and Australia – the second tier of defence technologies.

    In Asean, it is Singapore which arguably has the most advanced defence technologies and military procurement systems.

    How many of these countries would be willing to share their most advanced defence technologies with Malaysia? And how will Malaysia avoid being too dependent on any particular defence partner? Especially where military procurements dovetail with political considerations?

    Next, we have to consider the availability of indigenous domestic defence technologies and the availability of well-educated and skilled researchers, technologists and the concomitant manufacturing capabilities.

    Third, the matter of funding. Stuff procured has to be paid for. Is the country’s finances in good enough shape to be able to handle a significant defence procurement budget and at the same time to be able to fund other government priorities (education, health care, public transport and civil infrastructure) and maintaining an adequate surplus so as not to get ratings downgrades?

    • Trying to project Singapore again, eh?

      But you have not said anything to support your claim that Singapore has “the most advanced defence technologies and military procurement systems”.

      You are therefore liable to be pooh-poohed.

      • “project” or “protect”?

        And note that I wrote “arguably”. You are welcome to refute my comments about Singapore, in this context, if you can.

        “pooh-pooing” is a lot better than running around looking for support in the South China Sea.

        What was that about a defining “Code of Conduct” that Hishamuddin was talking about at the recent Shangri-la Dialogue in Singapore (yes, Singapore – sorry about that)?

        Any takers so far?

        And China continues to go on it’s merry way.

        What will happen when China and the US do a deal over the South China Sea over the heads of Japan and the other “claimant states”?

        Are we then going to scream “betrayal” a la Chamberlain and Munich?

      • What “protect” you talking about, man? And saying “arguably” entitles you to claim anything without justiifying?

        And you have exerienced running around in the Soith China Sea, have you?

        And what about “Hishammudin’s Code of Conduct”? Again, you just throw out the term and expect readers who may not have anything to do with defence to understand it? Trying to show you know and make others who have no time to google leave this blog feeling one-upped by you? You ultra kiasu?

        Won’t bother to say a few words about it so that readers have an idea what you talking about? That way makes it pleasant reading, even learn a bit from what is written instead of saying to hell with the ultra kiasu!

        And again, how does ““betrayal” a la Chamberlain and Munich” come into play here? You expect everybody reading this blog had studied the History of Europe or the 2nd World War?

    • Rithmatist commented at 5:02 am. Just curious if he is a Malay/ Muslim who comments just before or after bersahur? But he could be like old man Kit Siang, sleeps early and wakes up early for his tai chi, kon ti and what not.

      But his pre-occupation with Singapore and endless attempts at glorifying Singapore, often at the expense of Malaysia, in the past suggests he is the ultra kiasu kind.

      He asks a lot of questions of Malaysia this time. Mostly implying Malaysia has not got or is deficient in those things that he asked about.

      Can’t expect him to make suggestions on how Malaysia could be what he seems to think we are not, can we?

      So, what we do is just bash him lah. Always non-constructive, in fact, even destructive, denigrating comments.

      • “Bashing” seems to be your preferred modus operandi. Much like Nazri’s “whacking”, come to think of it….lol.

        The questions I asked – why don’t you answer them? Dazzle us with the brilliance of your intellect (to paraphrase the tagline of a well-known blogger)?

        And if I seem preoccupied with Singapore, it is with good reason. It seems to be doing pretty ok, threats of “sidelining” notwithstanding.

        If nothing else, the Sing Dollar can buy a lot more weapons systems and defence technologies than the Ringgit can…..

      • So, you have nothing else to say except lol? You asked questions and expect readers to answer them? What, is this a riddle or a quiz competition?

        No, you didn’t sound asking but are sarcastic and denigrating Malaysia in asking them.

        And if you think Spore “seems to be doing pretty ok”, why do you have to say it here. And where is your proof of “threats of “sidelining” notwithstanding”? Loose tongue? Shooting from the hip like an irresponsible cowboy?

        And now you talk about the Sing dollar – very much the line of the Oppo Hippos of Malaysia, the ultra kiasu DAP line of argument in every other comment made in blogosphere.

        Is your beloved Singapore involved with Tong. Anwar’s financial henchman who absconded to Singapore even before Anwar reached prison, accused of trying to sabotage the Malaysian economy, George Soros-like, said Tun Dr Mahathir?

  2. What is important ,whoever being elected ,are not their educational background or experience ,but what must be assured they are not in the category of ‘Melayu kayu ulu kapak’ ,which has done so many damage to the country ,.

    Malaysia, and Malays especially has enough of that, and we cant afford any further of this character .

    • It has to be balance.

      Substance without semangat end up like Khazanah and CIMB management.

      All semangat without substance will turn government into a Perkasa.

      Semangat and substance without integrity will end up like the many charlatan leaders in politics, government and corporate.

      • Oh
        God , how deficient we are , how to progress like this , need a new formula ?

  3. The system has been structured such that even in UK and US, it’s the Armed Forces top brass who review their country’s needs, study the weapons systems available in the countries producing them (the US often produce their own sophisticated weapons), evaluate each one that meets their specification, get the political masters’ approval, then call for tenders and/or negotiate the purchase terms.

    Rarely does the political master initiates action on reviewing the defence situation, determining the defence needs and the weapon systems to use, negotiating for funds under existing or upcoming budget, then initiate the purchase procedures. Except perhaps personalities like Donald Rumsfeld of US.

    I doubt it but would be interested to know if in Malaysia the political master i.e the Defence Minister plays a significant role in defence planning and equipment purchasing beyond being consulted for approval by the Armed Forces.

    In the past, the appointment of Defence Ministers has not taken into account much of the qualification and experience of the appointee. Ahmad Zahid and, the latest, Hishammuddin, included.

  4. I agree. It is about time to entrust the running of the Defense Ministry to someone professional, more technocrat than politician (and I am not referring to those PTDs). Dato’ Jo seems to fit the bill. His vast experiences in the high echelon of corporate world will be a big plus.

    If we look around just in this region, we would have noticed that we are falling further and further behind in terms military of capability. I sincerely hope that we will not be too far behind that we get to a stage where we are “ripe for bullying”. Just a little over 50 years ago the Indon under Sukarno launch the infamous “Ganyang Malaysia”. Simple reason behind it was Malaysia as fledgling nation back then was militarily too weak to resist, therefore will crumble under pressure asserted by the force of arm. Luckily Sukarno miscalculated the determination and the subsequent response by the Commonwealth forces.

    I dare says that the coming few years will be a defining moment for the Malaysian Armed Forces. If we failed to reform and expand the capability of the MAF, then the MAF is as good as irrelevant in our nation quest to become a middle powers. Worst, we will be vulnerable to outside threats and coercion.

    This is where people like Dato’ Jo came in. A minister with corporate background will be able to steer us through the financially challenging years ahead. I also believe his experiences will enable him to come up with creative ways and means to acquire much needed assets for the MAF.

    Keep appointing typical politician to that post will only hasten our own demise as a country.

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