Southeast Asia Seminar Series Recap–Ethnic Politics in Malaysia: Recent Trends and Pressures

November 14, 2016
James Chin

What is happening in Malaysia today? What are the most pressing concerns this multireligious, multiracial country is facing in the coming decade? Professor James Chin, Director of the Asia Institute at the University of Tasmania, Australia, and Senior Fellow of the Jeffrey Cheah Institute on Southeast Asia in Malaysia, investigated these large questions by examining five different aspects of the Malaysian society: changing demography and urbanization, education, economy, politics with the rise of political Islam, and East Malaysia.
    Prof. Chin began his talk by introducing some important facts about Malaysia. The country encompasses two regions geographically divided by the vast South China Sea: East Malaysia (Sabah and Sarawak) and peninsular Malaysia, in which 85 percent of the population resides. The population is officially 32 million, but the number would rise up to 34-5 million taken the undocumented residents, mostly from Indonesia and Philippines. Ethnicity matters; ethnic Malay and indigenous tribes from East Malaysia made up 60 percent majority of the population while the Chinese and Indians take 25 and 7 percent, respectively. The country’s diverse religions include 60 percent Muslim, 19 percent Buddhist, nine percent Christian and six percent Hindus. Ethnic Malay is constitutionally defined as Muslim and Islam is treated as the official religion. One feature of Islamic practice in Malaysia is that converting into Islam is final – once converted, it is almost impossible to leave the faith legally. Once one marries into a Muslim household and converts, even if the marriage does not continue, he or she cannot null the religious designation.
    Race and religion were always present as political pressure points since independence in 1957 but were contained by elite bargaining and urban-rural divide, with most Malay living in the countryside while the others concentrated on the urban centers. British colonial policy of “divide and rule” was also effective in repressing the potential racial conflicts as it assigned each race very specific roles and places in the society.   
     Prof. Chin posited that May 13, 1969 marked a crucial date for Malaysia, which led to the current problems. Ethnic riots broke out after elections and parliament was suspended. When parliament was restored in 1971, the most important policy that emerged was The New Economic Policy (NEP), known locally as the bumiputera policy. The bumiputera policy provided affirmative privileges to the ethnic Malay people in all economic, social and political spheres. The official reason was to right the imbalance in the economy created by British colonial rule; in the 1960s, the corporate wealth held by the Malays was estimated to be only two percent. To do this, a minimum 30 percent quota was established for the bumiputera in all business enterprises, and quotas were also established for all state funded tertiary institutions. The social engineering program was based  on a simple premise – government intervention was needed to help the Malay community to increase their share of the Malaysian economy and, more importantly, allow them to be on par on the non-Malays (i.e., the Chinese and the Indians). This, as the justification goes, will lead to political stability.

    The pro-Malay affirmative policy, however, brought about a number of unintended side effects. Like other affirmative actions around the world, it created resentment among the non-Malay population. It turned the Malaysian economy into a kind of rentier economy where elite Malays and Malays with political connections became the main beneficiaries of the NEP, not the ordinary Malays as envisaged. Prof Chin also noted that affirmative policy with economic benefits is almost impossible to stop given that beneficiates become “addicted” to free state subsidies. Far more dangerous, in the Malaysian case, the bumiputera policy aggravated interracial relations by cementing the ideology of Ketuanan Melayu (Malay Supremacy), which led to further marginalization of the non-Malay population. It also created a particular social condition in which people understand and interpret all events through the “ethnic lens.”   

I.    Changing Demography and Urbanization

Prof. Chin warned that this kind of affirmative policy is not sustainable. By the year 2040, the population of bumiputera will be 75 percent of the entire population. He asked whether it would be feasible to provide free economic privileges for more than two-thirds of the population. It is very unusual for affirmative action for such a large majority of the population – in fact, the only country with such a large affirmative program is South Africa, which is modelled in part on the Malaysian NEP. In fact, like Malaysia, ethnic relations have deteriorated in South Africa after the implementation of the affirmative action policy.
The rapid urbanization will cause another problem. Ethnic Malays have traditionally been living in the countryside; however, with the population rise and urbanization, more and more Malays will move to the cities. Prof. Chin projected that by 2020, 75 percent of the population will be living in the urban areas. This would shift the neighborhood structure from different ethnic enclaves to one classified by different income levels and the emergence of class politics. Despite the changing geo-demography, Prof. Chin foresaw that the number of rural seats in the parliament will increase since rural areas will still be populated by the Malay people and such a gerrymandering will ensure the Malay majority in the government, which in turn, will maintain the Malay supremacy policy.
II.    Education

For changes in education, Prof. Chin notes the diversification of educational institutions; there were only state-organized and Chinese/Indian schools in the past, but in the recent years, religious schools and private institutions were added. The big political problem is the differences between state and private institutions. The bumiputera population tends to attend state institutions while the non-Malays go to private institutions. Part of the reason is due to the discriminatory policies against the non-Malays in the state institutions. The other difference is the language of instruction. English is used by the private institutions while state institutions are required to use a mixture of English and Bahasa Melayu (the official language). The private sector wants graduates with good English, leading to a high number of unemployed Malay graduates from state schools. Many of these unemployed  Malay end up in the civil service, making the civil service a Malay enclave and further exacerbating the ethnic divide.

The biggest problem is the rise of private Islamic schools, many funded by Middle Eastern money. Many of these schools are operating outside the government’s jurisdiction and there is evidence they are using radical curriculum similar to the radical schools in Indonesia and Pakistan. Several pioneer members of the Islamic State (IS) fighters from Malaysia were associated with these private Islamic schools. As more and more of their graduates enter Malaysian society, they will provide the core base for the Islamist political movements. Politically, almost all of them support turning Malaysia into an Islamic state.  

III.    Economy

In regard to the economy, Prof. Chin contended that Malaysia faces three huge economic hurdles: the middle-income trap, income inequality and brain drain. The country has been stuck in the middle income trap since the early 1990s; Malaysia has lost its competitive edge in manufacturing and hit a plateau in productivity. Unlike other Asian tigers, such as Taiwan and South Korea, with the high level of dependence on cheap foreign labor, Malaysia has been slow in the growth of a tertiary sector of the economy and failed largely to enter the high-value-added market and innovation.    
Income inequality has also been a concern to Prof. Chin not because the Gini coefficient stood at 0.41 but because of the increasing income gap within the different ethnic groups and between the urban-rural divide. The Top 20 percent of the population shares about half of the country’s wealth while bottom 40 percent holds less than 15 percent. The largest income gap is among Malays, and yet the gap between Malay and non-Malay has been pronounced for the political purpose of justifying the NEP. Prof. Chin noted that as the government became aware that the 30 percent equity for Malay had been reached since the 1990s, they will have to justify a continuation of the affirmative policy. In the near future, Prof. Chin say it will use household wealth as the new measure of Malay/Non-Malay share of the economy, rather than corporate equity as in the past. In other words, as Prof. Chin noted, the NEP will become the “Never Ending Policy.”   

The biggest issue facing the Malaysian economy is brain drain. According to the World Bank, more than a million highly educated Malaysians have left Malaysia since the introduction of the NEP; most experts think two million have left Malaysia for better prospects in life. Among the emigres, the overwhelming majority are ethnic Chinese due to ethnic discrimination, but skilled Malays are also leaving the country due to limited job availability in the high skills arena. Prof. Chin also believes the rise in fundamental Islam is a key factor in the rising number of highly-skilled Malays leaving the country. This phenomenon is similar to countries such as Pakistan.

IV.    Politics

The sphere of politics is also significantly changing. The National Front (BN) has been in power for the past 60 years and remained as the most successful coalition in the world. It has maintained its hold over power using a mixture of racial politics and manipulation of the electoral system. The coming trend is the changing of ethnic divide to a religious divide where political discourse will be centered around Islam and Muslim versus non-Muslim narratives. This will allow the BN to maintain power as it projects itself as the supreme Islamic champion protecting the system from non-Muslims. This led to the rise of political Islam, a phenomenon forging the religion as the main source of interpreting the Federal Constitution, which was written in a secular spirit. The bureaucracy has been Islamized as there have been government agencies (e.g. Jakim) promoting Islam and the rules of Islam under the name of “educating” the Muslim population on how to be a proper Muslim. It is, in effect, embedding religion into the government bureaucracy. Such a political change gives more power to Islamic authorities to put down any dissent within Muslim communities such as the Shia, Muslim liberals, and the LGBT community. The other main target for the Islamic bureaucracy is the Christians. Sermons in mosques in Malaysia are issued centrally and they often target Christians and Jews as “enemies” of Islam.  
 What are the sources of the political endorsement? Many Islamic welfare groups and religious schools have been facilitating the change in order to create a specific worldview among the people. This process of “Arabization” has been on its way since the 1990s despite the government’s concern about the rising prominence of the Wahabi-sect, which seems to promote the Islamic State. Many right-wing Malay nationalist groups have joined forces with the Islamists since the 2008 elections, advocating the Malay-Muslim first policy. They are creating a climate of intolerance towards anything they consider “un-Islamic”, and very often these are the minority faiths but in the Malaysian context, these will include the minority ethnic groups such as the Chinese and Indians.
V.    East Malaysia

All these stated changes, however, are taking place in peninsular Malaysia while East Malaysia maintains a completely different history, demography, culture and subsequently, political stance. In fact, Islam claimed a narrow majority in the Sabah region while Christianity is the biggest religion in Sarawak. Moreover, the Sabah Muslims are primarily from Indonesia and Philippines, who along with the native population, largely do not agree with the Malay-Muslim first policy. The tribal majority groups in Sabah and Sarawak are unhappy with the way the bumiputera policy was implemented by the Malay civil service. Although classified as bumiputera, these tribal groups did not receive any real benefits as Malays were given the benefits ahead of them. Many called themselves “second class” bumiputera. Many East Malaysians, in addition, are unhappy with the current direction of Malaysia, generating a growing support for East Malaysian secession.

One major issue going forward is the lack of common ground to find a political consensus. Among Muslims, there have been increasing conflicts over the issue of what kind of Islamic government the Malay state should be. There are Muslims who want a full Islamic state while other Malays are happy to maintain the current status quo. The gulf between these two groups has led to death threats. The Muslim and non-Muslim cleavage is getting deeper as the numerical majority tries to keep the “protected class” status. The secular, urban population who tend to conduct all their political activities in English and also in cyberspace complicates the scene as most of the Malay grassroots conduct their political discourse in Bahasa Melayu.   

Prof. Chin concluded with a series of questions encapsulating the talk. Can and will the Malay state afford the affirmative action policy for the numerical majority, Malay-Muslim? How would the state reconcile the rise of increasingly varying worldviews resulting from the increasingly diversified educational institutions? How should it bring those educated under different systems together to discuss politics on shared ground? How can the three problems of the economy – middle-income trap, income inequality, and brain drain – be solved? Will the rise of political Islam lead Malaysia down the path of Pakistan or Bangladesh? Where does and would East Malaysia fit in this sort of system?