Sunday 19 June 2011

Reversing the brain drain requires a paradigm shift - By Tricia Yeoh

When the World Bank launched its Malaysian Economic Monitor “Brain Drain” issue, I received a hurried call from a friend. His contact, the chief author of the report, was concerned that the matter would be kept under wraps by the Malaysian government, and hoped that it could be disseminated far and wide, and discussed openly. The concern was that it painted Malaysia in a bad light, and this indictment on the country would be a slap in the government’s face, perhaps. The report made no apologies for the situation at hand: that Malaysia has suffered significantly over the last decade, having lost its best talents to other more developed nations abroad.

More specifically, that there are an estimated 1 million Malaysians living outside the country, one third of whom belong in the “brain drain” category. Out of this, almost 60 percent lives in Singapore, out of whom more than 90 percent are of Chinese ethnicity. Although career prospects was the primary reason cited, the next few included social justice, governance issues, and lack of meritocracy. It has oft been repeated that non-Malays in particular have felt the pinch of unfair treatment, and not wanting to feel as “second-class citizens”, leave for fairer ground elsewhere.

Much ink has already been spilt over the New Economic Policy, Bumiputera rights, ethnic-based affirmative action. The point has been made. There is dispute over whether or not to end these policies, between those who have and stand to continue benefiting from it – and those who have experienced direct discrimination as a result thereof.

No Need for Colour in Policies 

And it is this crux of the matter that Pakatan Rakyat is attempting to address. For all its song and dance (and there are a lot of such antics – after all, this is politics), Pakatan Rakyat has never abandoned its clarion call for abolishing race-based policies in favour of policies that benefit those who are truly in need. The argument goes, if there is anyone poor and requiring aid, should the person not receive it regardless of his or her colour? There is no dispute here amongst the three coalition parties.

So this is precisely the banner taken on by the Pakatan Rakyat states. The theme of welfare based on the needs of society has been the practice of Penang, Selangor, Kedah and Kelantan – and was championed in the recently concluded Sarawak state elections by the opposition parties (the latter of whom gained significant ground by increasing its representation from 7 to 16 out of the 71 state seats in total). This is evident in its array of policies and programmes implemented, examples of which are aid packages for the elderly, disabled, young children, and training programmes for young entrepreneurs, where ethnicity plays no determinant role.
The Federal Government has recently formed the Talent Corporation in response to this, but all the tax incentives in the world will not detract from the core problem of ethnic favouritism built into the national economic fabric. This affects not only employability, promotions, the worth of one’s income – but more importantly the morale of those who ultimately feel devalued as a result.

Ingredients for Talent Retention

The Pakatan Rakyat coalition is attempting to address the very thing deterring our young Malaysian talent from returning home – promoting social justice and equal treatment amongst all alike. However, is this really enough? For urban centres such as Penang and Selangor to propel themselves into the ‘new economy’ ahead, it goes without saying that talented, intelligent individuals will be required to contribute to the workforce.

The same World Bank report noted that Malaysia, without the appropriate skills and talents, has been unable to upgrade to higher levels of specialisation. However, it did state that Penang has been more successful than Selangor and Johor Bahru in this area, citing examples of testing and design of integrated circuits as opposed to mere assembly. These are the sorts of innovative means the state governments must look toward – promoting industries of the future such as services, high-end manufacturing, and technology-related.

A good example lies in the layer of young entrepreneurs, whose efforts should really be recognised and made mention of. I had the privilege of meeting the young country head of Groupon Malaysia, an online site that allows consumers to obtain discounted deals and services by ‘group’. Growing internationally, Groupon’s employee profile is the mobile, talented, intelligent young person with business acumen: the type of persons the Malaysian economy needs. But to attract this group to stay home, the right conditions are required that their ideas can flourish and take flight.

We live in the reality that there is a global competition for talent, and individuals are extremely self-selective and mobile. The laundry list of reasons Malaysia is losing out includes factors such as less attractive salary, lack of career prospects, social injustice, quality of life factors, access to high-quality education, and the presence of a diaspora network.

Based on the report, the variables affecting FDI (foreign direct investment) flow, which are similar reasons for the out-flow of talent and that can be controllable by policy-makers: i) quality of FDI-related regulations and institutions; ii) skills and innovation; iii) wages, and iv) infrastructure. Under the first category of quality of regulations and institutions are: the rule of law, regulatory quality, government effectiveness, control of corruption and political stability.

State Governments can play a role too

Where most of these fall under the jurisdiction of the Federal Government, this does not necessarily mean state governments should not take up the role to influence these factors. For example, states can promote skills and innovation on its own accord through its private and government-linked and other (educational) institutions. States also can contribute by ensuring sufficient infrastructure. Penang is pushing for the entire state to go wireless; Selangor has plans in this regard as well although numerous cafes and centres already have wireless networks.

In an earlier column I wrote that it is really a competition of cities instead of countries. A talented professional abroad will think in realistic and not abstract terms. Which industries in Penang, Selangor, Johor, would require my services and pay me well for it, recognising my talent? State and Federal Government will have to work together closely in the future to ensure the factors so articulately laid out in the brain drain report are adequately addressed. Despite being at either end of the political divide, both parties agree on one thing: that Malaysia will remain in its economic rut if the outflow of talent continues.

Finally, the report interestingly noted that almost half of the Malaysians abroad feel a strong sense of attachment to the country. Despite many of them also feeling settled in their new countries of abode, they still have some patriotic feelings towards home. Coupled with the fact that 65% of those surveyed say they are unsure about whether to return to Malaysia or not, this means there is certainly room for persuasion. We are at a critical point: the manner in which Pakatan Rakyat states handle the very problems they left Malaysia for will be strong determinants for their future destinations of choice.

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