Warisan: Scrap 51% Bumiputera rule

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Warisan has urged the government to scrap the 51% Bumiputera ownership requirement for freight forwarding companies.

Its president Shafie Apdal said it was a form of discrimination to local players in the logistics industry.

“This is because the requirement for the 51% Bumiputera equity is not applicable to international or foreign companies,” he said in a statement today.

He said foreign companies cannot be subject to the rule because the industry had been liberalised under most free trade agreements (FTAs).

“As such, any condition that oppresses foreign companies can be considered a violation of the FTAs.

“It is not fair then for the government to instead enforce the equity rule to local industry players.

Bernama

“Warisan is of the opinion that if the government decided to liberalise the industry and is open to any international companies without any conditions, the same principle should apply to local industry players.”

Shafie said the government should study in detail the policy’s implementation, particularly the readiness of Bumiputera players to buy equities in the companies concerned.

He was worried that without a careful review, most companies would not last and would fold.

“This is more concerning if the percentage of Bumiputera buyers who are qualified and able to take over the equities is low, particularly when the country is faced with the Covid-19 pandemic.

“If this happens, there’s a high possibility that local industry players might have to sell their companies to foreign ones.

“This is a detrimental move as it will widen the gap of equity ownership between local and international companies.”

Shafie said that according to data by the Economic Planning Unit, the equity ownership among foreigners has risen from 37.2% in 2011 to 45.3% in 2015.

In the same period, equity held by non-Bumiputeras has dropped from 34.8% to 30.7%, he said, adding that Bumiputera equity ownership has also fallen from 23.4% to 16.2%.

“As such, Warisan rejects any form of discrimination against local companies, whether Bumiputera or not, which will only benefit foreign companies.

“The government should prioritise companies within the country so they can compete with international ones,” he said.

Shafie said that although Warisan believed affirmative action was needed to close the socioeconomic gap between the races in Malaysia, it should also be done fairly.

“It should not be implemented just to give an advantage to foreign industries or the Bumiputera elites alone,” he said. – FMT