With Turkey’s economy in crisis, it has no money to invest in Malaysia.
Since taking over in August last year as Malaysia prime minister, Ismail Sabri Yaakob had made overseas trips a whopping 11 times. That’s about one trip every month since the unelected backdoor premier replaced former PM Muhyiddin Yassin, who was forced to resign after just 17 months in the corridors of power – toppled by a faction of his own ally, UMNO.
Ismail had jetted to the US, the UK, Vietnam, Japan, Singapore, Indonesia (twice), Brunei, Cambodia, Thailand, Qatar and the United Arab Emirates (UAE). And the prime minister, who loves showing off his RM5,500 Burberry designer shirt and RM300,000 Audemars Piguet watch while people are struggling to put food on the table, is now in Turkey for a four-day official visit.
What’s wrong with a prime minister who goes globe-trotting like a celebrity? There’s nothing wrong, except in the case of Ismail Sabri, the dozen overseas trips has failed to bring meaningful benefits – either direct or indirect – to the country, except wasting taxpayers’ money to the tune of tens of millions of dollars, money which can be used to help the people during current economic crisis.
Joe Biden, the 46th President of the United States, has only made five international trips to 10 countries during his presidency so far, which began on January 20, 2021. Yes, the world’s most powerful man (hence the busiest world leader) has only visited 10 nations in 18 months, but the turtle-egg man has already flown to 12 countries in 11 months. It seems like Sabri is busier than Biden.
Exactly what tangible benefits that PM Sabri is expected to bring home after his four-day visit to Turkey (renamed as Türkiye last month), which began on Tuesday (July 5)? Let’s forget Turkey – what economic benefits have the premier secured from his previous 11 trips to the UK, Vietnam, Japan, Singapore, Indonesia, Brunei, Cambodia, Thailand, Qatar and the UAE.
To justify his wasteful and unproductive Turkey visit, sexy words were used – to strengthen bilateral and economic ties, as well as cooperation in aerospace and defence industries. The visit reportedly will see 15 memorandum of understanding (MOU) and letter of intent (LOI) to be signed. PM Ismail is also scheduled to meet President Erdogan at the US$600 million 1,000-room Presidential Palace in Ankara.
Interestingly, despite diplomatic relations since 1964, total trade between the two countries were only RM16.97 billion (US$4.09 billion) in 2021. Even though the Malaysian government has claimed that it managed to attract foreign direct investment (FDI) as much as US$73 billion (RM322 billion) in 2021, 89% of the FDI came from China, Singapore, Japan, Austria and the Netherlands.
Turkey has no money to invest in Malaysia. In fact, the Turkish economy is so screwed up that its inflation continues to skyrocket – from 73.5% (May) to 78.6% (June) – the highest in 24 years. The real rate of inflation, however, could be double (meaning over 140%) the official figure due to hikes in oil and gas prices as the Erdogan government covers up the real economic problems ahead of next year’s general election.
A monthly report released by Turkey’s ENAG group of independent economists showed consumer prices had increased by 175% in June compared with a year earlier. According to the Istanbul Chamber of Commerce, retail prices had shot up by 94% annually in June. Timothy Ash, an economist at BlueBay Asset Management, said – “No one actually believes official Turkish data anymore.”
The problem began as early as in 2000, deteriorating during the European Debt Crisis in 2010 when the Turkish currency – Lira – started to tumble and has continued its depreciation ever since. Over the last 10 years (July 2012 – July 2022), the currency has lost a whopping 89%. This year alone, the currency has lost 25% of its value due to soaring inflation and the central bank’s refusal to raise interest rate.
The ongoing financial and economic crisis in Turkey is so bad that it gave birth to the humiliating “2018-2022 Turkish Debt and Currency Crisis”. In a nutshell, the never-ending skyrocketing inflation and plunging currency were caused by Erdogan’s authoritarianism and his unorthodox monetary policy, corruption, nepotism, economic mismanagement, low savings and whatnot.
Instead of getting qualified professionals to run the financial system, Erdogan appointed obedient loyalists, including his son-in-law, even though they were clueless and incompetent. Senior bank officials were fired for opposing Erdogan’s demand for lower interest rates to boost growth. While higher interest rates are used to tame inflation, the Turkish president has stubbornly said the opposite.
Erdogan’s bizarre theory says high interest rate causes prices to rise. He also used Islam to condemn high interest rate, arguing that not only it is “the mother and father of all evil”, but insisted that interest-based banking is “prohibited by Islam”. Yet, despite Erdogan’s “new economic model” of low interest rates, foreign investors have fled quicker than the president could imagine.
Hilariously, the financially-illiterate Turkish president has claimed that Turkey’s problem is not inflation, but rather a cost-of-living problem. He still has no idea why the local currency is so weak that US$1 can buy 17 liras, when one buck could buy about 2 liras some 10 years ago. Worse, the Turkish net international reserves dropped to just US$12 billion in May this year.
At one time, in order to support the Lira, Turkey lost a stunning US$4.8 billion in just one week. As Erdogan continues to burn the country’s remaining reserves to the ground to prop up the local currency, it’s not rocket science that Turkey has no spare cash to invest elsewhere, including Malaysia. Erdogan’s son-in-law had burnt US$128 billion in foreign reserves (from early 2019 to Nov 2010) when he was the finance minister.
Instead of hoodwinking the people with lies that his working-cum-pleasure trip to Istanbul is to lure investments from Turkey, Ismail Sabri should explain what has happened to the RM82 billion worth of investments, which former Plantation, Industries and Commodities Minister Mohd Khairuddin Aman Razali had brought back after his three-day visit to Turkey in 2020.
In the same breath, Minister of International Trade and Industry Azmin Ali, who was caught holidaying with his family in Turkey in July 2021 under the pretext of a working visit, should explain how much real investment money – not empty talks or MOU – has actually been invested in our country after his 10 days trip (4-14 July 2021) to Qatar, Austria and Turkey. Is PM Ismail going to sign more dubious MOUs again in Turkey?
Other ministers who had previously flown to Turkey on doubtful official trips included Deputy Foreign Minister Kamarudin Jaafar (April 2021), former Foreign Minister Hishammuddin Hussein (June 2021), Foreign Minister Saifuddin Abdullah (Dec 2021), Minister of Plantation Industries and Commodities Zuraida Kamaruddin (April 2022) and Home Minister Hamzah Zainudin (June 2022).
It was also highly suspicious when PM Ismail said his trip to Turkey is to explore the possibilities of buying wheat from Turkey as part of food security strategy. Malaysia currently imports 80% of wheat from Australia and the rest from the US, Canada and Ukraine. Even though the world is affected by a shortage of wheat due to the Russia-Ukraine war, Malaysia is not affected.
After all, it was the Domestic Trade and Consumer Affairs Ministry who announced in May that the supply of wheat flour in the country is not affected – even after India banned the export of the commodity. So, either the government lied two months ago that the supply of wheat was not affected, or it is lying now to say the country needs to source for wheat from Turkey.
Even if Sabri’s administration tries to cover-up a shortage of wheat, why must it buy from Turkey when Malaysia could easily increase the wheat import from Australia, whose wheat has been boycotted by China? Does Turkey provide steep discounts for its wheat export to Malaysia, the same way Russia gave a 30% discount for its oil exports to China and India?
The best part of the Turkey trip is a session to discuss issues concerning the Ukraine between Sabri and Erdogan. While the Malaysian-Turkish discussion will produce nothing but empty talks, Indonesia President Joko “Jokowi” Widodo had taken the initiative to play a mediating role in the Ukraine War, meeting Ukrainian President Zelensky and Russian President Putin.
Jokowi’s courage to go to war-torn Ukraine and approach Putin to ease the sea blockade of Ukraine has won praise. Even though no country expects Jokowi’s diplomacy could offer a breakthrough largely because the geopolitical conflict between Russia and Ukraine is too complicated to be fixed within such a short period of time, the Indonesian leader did not return empty-handed.
The Russian strongman considers Jokowi as an “understanding friend”, who had earlier met Zelensky to deliver his message to Putin. After meeting Jokowi, Putin told reporters that he is ready to fulfil Indonesia’s request for fertilisers. Jokowi said Putin has agreed to open a sea route for Ukrainian wheat exports amid escalating concerns over the global food crisis.
During his recent trip to the US, Jokowi met and won the heart of Elon Musk to build a Tesla battery and EV (electrical vehicle) plant in Indonesia. And in his latest trip to Russia, he managed to extract an assurance from Putin to allow much-needed shipments of food and fertilizer. Jokowi is the only Asian leader, and among very few world leaders who have met the leaders of both Ukraine and Russia during the current war.
Clueless and incompetent Ismail Sabri, on the other hand, has been wasting taxpayers’ money on unnecessary and unproductive overseas trips. His current visit to Turkey includes a huge delegation of ministers – Saifuddin Abdullah, Azmin Ali, Adham Baba, Abdul Latiff Ahmad – and other senior officials. It is actually another free holiday for a bunch of useless ministers. – Finance Twitter