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Aliran: The Nanyang Takeover Crisis
By Dr Francis Loh

15/7/2001 1:12 am Sun

Highlights from Aliran Monthly

The Nanyang Takeover Crisis:
Representing or Opposing Community Interests?

by Dr Francis Loh

Now that its EGM is over, MCA's takeover of Nanyang Press Holdings Bhd is a fait accompli. MCA will probably follow the Prime Minister's advice and shed part of its Nanyang shares to some 'strategic partners'. The financial burden of assuming 72% of Nanyang shares alone should persuade MCA's Huaren Holdings Sdn Bhd to do this, and sooner rather than later.

Only 53 per cent of those who voted at the 24 June EGM favoured the takeover. Even so the 'Gang of Eight' led by Lim Ah Lek and Chua Jui Meng have declared that they will accept the EGM's decision. Their road-shows will stop. The party will close ranks. But for how long?

Even if there's no mud-slinging within MCA, there is still a storm of protest in the Chinese community against the Nanyang takeover. The protest will not die so quickly but will probably haunt MCA. Indeed Ling Liong Sik's slim victory suggests MCA is so split that it will only be a matter of time before another round of intra-party feuding occurs with even higher stakes. Then the Nanyang takeover which has united Ling's rivals as never before will gift them with a critical issue at the MCA party elections due next year.

Perennial Succession Feuds

MCA has had a very fractious past, not always because of substantive differences, but because of fierce contests for top positions (see accompanying box).

Consider the party feud that has festered in recent years between MCA president Dr Ling Liong Sik and his deputy, Lim Ah Lek. Ling's allies include two vice presidents, Ong Ka Ting and Dr Fong Chan Onn, secretary-general Dr Ting Chew Peh, Wanita chief, Dr Ng Yen Yen, and Penang MCA leader, Dr Sak Cheng Lam. Closely linked to Lim are his protégé, vice-president Chan Kong Choy, and Fu Ah Kiow and others from Pahang.

What is the basis of this dispute? Essentially it involves succession to the party leadership, an issue that goes back to Ling's call to older MCA leaders at the 1998 Annual General Assembly (AGA) to vacate their ministerial appointments and party posts to make way for younger figures. When Lim declined to contest the 1999 general election, it seemed that the two top leaders had reached a 'gentlemen's agreement', which included Chan Kong Choy's replacing Lim as a federal minister.

Two other ministerial positions were then occupied by Ting Chew Peh and vice-president Chua Jui Meng. Ting contested the 1999 general election but was persuaded to step down as minister. Being younger than Ting, Chua didn't think he was due for retirement. Indeed, some said that Chua had cast his eyes on the party presidency.

But when Dr Mahathir reshuffled the cabinet after the November 1999 general election, Ling and Chua were re-appointed as ministers while Ong and Fong replaced Ting and Lim.

Ong's promotion was predictable: he is Ling's former political secretary, his protégé as well as his unannounced successor. Ong has a reputation for being a capable administrator and maintains good rapport with the party rank-and-file, Chinese associations, and the community at large, as well as with UMNO leaders. However, Lim didn't expect Fong to be MCA's fourth minister.

At MCA's 47th AGA, in June 2000, Ling claimed that his 'hands were tied': there were four vice-presidents but only two vacant ministerial posts. So he considered seniority and popular support in deciding who to promote.

A year earlier, five candidates had vied for the four vice-president's posts. Fong had the highest number of votes, followed by Chua, Ong and Chan. Yap Pian Hon, vice-president since 1990, came last. So, Ling kept Chua and promoted Fong and Ong, evidently in accordance with the general assembly's preference.

But this decision apparently didn't honour the 'gentlemen's agreement' reached between Ling and Lim. Lim had stepped down. However, someone from Ling's team, and not Lim's protégé, had benefited.

Undemocratic Criteria

Had Ling applied the correct criteria? Was Lim resorting to cronyism?

In fact Lim had followed party tradition. MCA had not, at least not recently, allocated its ministerial posts, or top party posts for that matter, according to the 'more democratic' principles which Ling was apparently upholding.

For example, Yap Pian Hon had polled the highest vote of all the vice-presidents in 1996 and had been a vice-president since 1990. Yet Ling had not recommended Yap for a ministerial appointment - as a delegate to the 47th AGA pointed out.

The intra-party differences developed in a peculiar manner in May 2000 (see AM, 20, 4). Ling suddenly announced his resignation as a minister, ostensibly to allow Chan to replace him: 'He (Chan) was the only vice president without a ministerial position.' In the event, Ling withdrew his resignation after two weeks' 'reflection'.

The feud reared its head again in early 2001. Lim apparently pressured Ling to set a date for the latter's retirement as minister. Simultaneously it was proposed that Chan should be appointed acting deputy president if Lim were to vacate his party position. There was a precedent for this proposal: in 1996 MCA's presidential council had arranged for Lim to succeed Lee Kim Sai as deputy president without contest, while Ting was promised the position of secretary general.

These decisions were subsequently endorsed by the MCA central committee and touted as evidence of MCA's 'culture of smooth succession'.

Maybe Lim meant to invoke this 'culture' but it looked as if the proposals only provoked demonstrations and counter-demonstrations. Ongoing Ling-Lim talks were suspended in February 2001 'to avert instability'. At any rate, the Ling-Lim dispute over party succession hardly excited other MCA factions, let alone the wider Chinese community.

Anti-Ling Factions Unite

The Nanyang takeover is a wholly different episode. The controversial takeover has galvanised Lim's faction and other anti-Ling groups into a formidable force.

The 'Gang of Eight' now included Youth leader, Ong Tee Kiat, who was previously political secretary to Lee Kim Sai, Ling's old foe; Yap Pian Hon, the former three-term vice-president whose popularity brought him no ministerial post; deputy Wanita leader, Dr Tan Yee Kew; perennial Ling critic Wong Mook Leong, and others. To everyone's surprise Health Minister Chua Jui Meng, a former Ling associate, joined the 'Gang of Eight'.

The Nanyang takeover had given the anti-Ling group a significant issue to legitimise its challenge. During their road-show, Lim repeatedly declared, 'It is the duty of all party-loving members to ensure that the party leadership listens to the sentiments and voices of members and the Chinese community.' Should the leadership fail to do so, he argued, MCA would be set on 'a collision course with the Chinese community which might have an adverse effect on the BN'.

Chua Jui Meng argued that politics and business shouldn't mix, that MCA shouldn't become 'MCA Sdn Bhd'. Instead MCA should focus on the political management of the affairs of the nation.

Never mind that MCA is already involved in business, and, through Huaren Holdings, owns 66.34 million shares of Star Publications. Chua was particularly concerned that MCA had 'mortgaged' away its Star Publications shares, and would be saddled with a RM230 million debt to pay for its Nanyang acquisition. Never mind that Chua himself is a trustee of Huaren Management Sdn Bhd. He was worried that such 'a huge debt' would distract the MCA from serving the Chinese community. Never mind Chua's political ambitions.

But all this was heady stuff - no longer a petty fight by gentlemen over an unfulfilled leadership succession agreement. At one of the road-shows, Ling was reminded of the promise he made in 1986 - upon becoming president after the Tan Koon Swan debacle and deposit-taking co-operative scandals - that he would divorce MCA from business.

From Honeymoon to Disillusionment

In the background is the political ferment within the Chinese Malaysian community. The mid-1990s saw the Chinese community rallying behind Barisan Nasional and Dr Mahathir Mohamad when BN polled 53.2 per cent of the Chinese popular vote in 1995 compared to 41.5 per cent in 1990

These past couple of years, however, rumblings of dissatisfaction have re-emerged.

It's widely believed that the Chinese gave overwhelming support to MCA and Gerakan in the 1999 general election, allowing MCA to win 12 seats and Gerakan 3 out of the 24 Chinese-majority constituencies, and thus helping BN retain its two-thirds parliamentary majority.

Yet, the situation was more complex. In the 6 seats (in the peninsula) having more than 80% Chinese voters, BN only polled 45 per cent of the average popular vote and won just 1 seat while DAP captured 53 per cent of the vote and 5 seats. In fact BN/MCA's share of the Chinese vote in the 24 Chinese majority seats declined slightly between 1995 and 1999.

Political Ferment

Besides, several new groups and coalitions emerged before the 1999 election. The best known of them was the group of 11 organisations which sponsored the '17-Point Election Appeal', or simply Suqiu.

Suqiu included typical 'Chinese demands' such as fair and equitable economic policies and multiculturalism as the bases for national unity, the development of Chinese schools and the improvement of Chinese new villages.

But Suqiu also wanted to restore constitutional democracy, maintain professionalism in the police force, protect human rights and justice, advance the rights of women, workers and the indigenous peoples, and to provide housing for all. Moreover, Suqiu wanted the government to curb corruption, review privatisation policies, protect the environment, repeal the ISA and safeguard press freedom.

Such demands were made in the spirit of reformasi.

Thus Suqiu created a stir among the Chinese community. Subsequently 2095 (out of an estimated total of 4000) Chinese organisations endorsed the '17-Point Appeal'.

But it was also evident that the community was split between pro-BN organisations like FECAM and ACCIM (the Federation of Chinese Associations in Malaysia and the Associated Chinese Chambers of Commerce and Industry in Malaysia) and organisations such as Dong Zong and Jiao Zong who thought it opportune to support a 'two-coalition system' without specifically endorsing Barisan Alternatif.

There was a smaller group of Chinese organisations that supported BA. And although they endorsed the '17-Point Appeal' they separately launched 'The People are the Bosses' declaration.

The implications of these political developments, not widely noticed because of the more dramatic reformasi, were serious enough to compel MCA, Gerakan and SUPP to support Suqiu. Indeed, in September 1999, Ling Liong Sik proudly announced that the Cabinet had considered the '17-Point Appeal' and appointed him to head a special team of Chinese ministers to meet the organisations. He added that 'none of the issues had caused any controversy or were rejected by the Cabinet outright' (The Star 23 Sept 1999).

Controversies and Disappointments

Since November 1999 the political ferment has taken on other dimensions.

First, UMNO Youth leaders had alleged in August 2000 that an ACCIM leader, and then Suqiu, had questioned Malay special rights. On Merdeka Day, Dr Mahathir even likened Suqiu to 'extremists', 'communists of the past', and even the alleged Al-Ma'unah militants. He claimed the Chinese media had 'sowed misconceptions among moderate Chinese'.

In September 2000, Ling lamely attempted to alleviate Chinese anxieties by claiming that the prime minister had not referred to Suqiu.

But the Chinese community was incensed that MCA and BN's other 'Chinese parties' which had supported Suqiu barely a year ago now sang a different tune. Many regarded Ling's advice - 'Listen to the PM', 'Don't be extreme in your demands', 'The PM's advice is pertinent, mature and borne out of his vast experience in governing the country' (see AM, 20, 7) - to be patronising.

The disillusionment grew when the government insisted on implementing the 'Vision Schools'. Despite BN's repeated assurances that the objective of Vision Schools is to promote interaction and unity among children of different ethnic backgrounds, the vast majority of the Chinese majority were unconvinced that the manner of implementation of the 'Vision Schools' would not change the character of Chinese schools.

Many community leaders criticised the inadequate consultation between the government and the Chinese schools. Some Jiao Zong leaders were adamant that the government's assurances would end up like past unfulfilled promises to Chinese schools. They demanded that written clarifications of the Vision School concept be made available for prior and comprehensive discussion. The government refused. At which point the Chinese educationists proposed that the 'Greater Interaction Programme to Promote Unity', agreed by all BN parties in the mid-1980s, but shelved due to the recession then, be implemented instead .

As it turned out, a by-election in Lunas, Kedah, became a testing ground for Chinese voters' discontent over Suqiu's treatment and the Vision Schools. That discontent joined with Malay voters' continuing dissent over the Anwar Ibrahim affair, the government's withdrawal of Trengganu's oil royalty, and the 'character of our leader, Dr Mahathir' (according to a Johor UMNO leader). The result was BN's stunning defeat in November 2000, which critically lost BN its two-thirds majority in the Kedah State Assembly.

Meanwhile, other controversies have emerged. One important controversy had to do with the relocation of SRJK Damansara (C) Primary School which many parents and students opposed. This issue once again highlighted long unresolved Chinese concerns over the construction and expansion of Chinese primary and secondary schools. Another emotional issue surfaced when approximately 500 Chinese 'top scorers' in the government examinations weren't admitted to public universities.

Consequently the prevalent perception in the Chinese community has it that BN has ignored Chinese requests, not adequately consulted the community, and reneged on electoral promises. Along with that is the assessment that MCA had insufficiently championed the rights of the community.

Takeover Time

And then came Nanyang.

Dong Jiao Zong and FECAM criticised MCA. Surprisingly even ACCIM did so. These three principal Chinese organisations joined hundreds of others to establish CAT (The Committee of Chinese Organisations Against the MCA Takeover of Nanyang Press).

CAT refused to accept that the acquisition was a 'purely business deal'. CAT declared that, 'It is the responsibility of every party to ensure the independence of the media from partisan control or intervention.' More than that, CAT insisted that, 'The MCA as a member of the ruling coalition, Barisan Nasional, which has accepted Suqiu in principle, should not directly or indirectly intervene in media operations.'

The Malaysian Chinese Newspaper Editors Association urged MCA to rescind the sale. In protest, some 90 columnists and contributors to the Nanyang Siang Pau, China Press, Sin Chew Jit Poh and Guangming decided to stop writing for the dailies. They condemned the takeover for 'pushing through a scheme that runs counter to democratic principles' and which spelled 'the end of the independence and autonomy of Chinese dailies'.

What was Ling Liong Sik's response? He repeatedly stated that the character and identity of the dailies would not change. He added that MCA would relinquish management of the papers to Star Publications or other 'strategic partners'.

As MCA's EGM split and the continuing protests in the Chinese community show, either the MCA president is naïve or he considers the Chinese community to be naïve. By holding up Star Publications as an example of how MCA would guarantee the acquired newspapers' independence, Ling has in fact confirmed the protesters' worst fears.


The widespread protest against the takeover among the Chinese community can be located within the context of the political ferment that has been occurring. In part, the ferment is related to the economic uncertainties which characterise the current period. But it is also, no doubt, related to the Anwar factor and the growing disillusionment among Malaysians of all ethnic groups with the BN government and Dr Mahathir's leadership.

This ferment probably involves one half of the Chinese community. Of this one half, only a small group openly identifies with the Barisan Alternatif, while a larger proportion is drawn to the prospect of a two-coalition system, without necessarily endorsing the BA. There are at least two reasons for the ambivalence towards the BA.

First, there is a fear of PAS and its agenda of an Islamic state - a fear that is only partly due to the propaganda of the BN parties. Indeed, the contradictory statements and often unnecessarily moralistic policies introduced by Pas-led Kelantan and Terengganu have also created alarm - despite Pas' regular assurances that non-Muslims would not be discriminated against and its sincere efforts to reach out to the Chinese community.

Second is the uncertainty over what Pas, indeed the BA, stands for. There is already much anxiety if not criticism of Pas' overly moralistic stance over what are considered personal matters like dress, gambling, the role of women and other cultural issues. Yet there is little information on its educational, finance, industrialisation and investment policies.

Disillusioned with the BN/MCA, fearful of PAS, and unsure of what the BA stands for, the Chinese community appears to have recoiled inwards to protect its current interests - its schools, its businesses and associations, and of course, its media. It would not be surprising if the Gang of Eight tries to capitalise on the community's uncertainty and disenchantment.


Quick off the Block

With the MCA gobbling up two relatively independent Chinese dailies, independent journalists and contributors have turned to the Internet in search of media freedom. Within weeks, several Chinese news-websites have sprouted and chalked up thousands of hits. Check them out.

Mytianwang - Berita Generasi - Freemedia -