Sabah's transport system needs overhaul

Written by arimi sidek

It is something that we probably are not aware of. But there is an economic discipline known as transportation economics. Transport economics is a branch of economics that deals with the allocation of resources within the transport sector and has strong linkages with civil engineering. The core of the discipline is about of the allocation of transportation resources in order to meet the needs of a society.

Note: This is a reproduction of my article that was published in Daily Express newspaper [Sabah], aims to cater wider and more serious audience on the matter.

The development of models to estimate the likely choices between the non-similar goods involved in transport decisions (discrete choice models) led to the development of an important branch of econometrics, and a Nobel Prize for Daniel McFadden.

In a macroeconomic sense, transportation activities form a portion of a nation's total economic product and play a role in building or strengthening a national or regional economy and as an influence in the development of land and other resources.

But, even without knowing about transportation economics, one will be able to notice that public transportation in Sabah is far from being efficient at present.

To be more specific, let's begin with bus as the core of public transport in the State. I rather call them as mini bus and van.

So far, the only available "upgrade" I can see in Kota Kinabalu city so far are the terminals. But even these, there are so many things that we can talk about. For example, enough to say that if Wawasan bus terminals ran by a company, it would have gone bankrupt long ago.

It is located at the far end of the city and both mini bus operators and commuters seems try their best to avoid it. They prefer doing business together i.e. loading and waiting at the two most congested spot in the city. One, at the bus stop in front of Shang-Ri-La hotel not far from Bandaran Berjaya. And the other, at the old Cathay cinema bus stop.

I can accept the fact that those terminals are part of the whole public transportation restructuring process, to our joy as Sabahan.

The only problem is that, we do not live in future – we live at present. If there are such things as transport development planning in phases and in place for the time being, apart from those terminals, what are they?

More on mini bus and van. You probably confuse on why do I put them in separate categories. But mini bus – with around 24 seaters, and van are truly different in term of capability, technology, comforts and also safety. But both are a misery for public commuters. I wonder for how long Sabahan will commute and transport by van. It is too much to traveling discomfort for a ‘city’ dweller. It’s van, not a bus.

It is okay if you travel with your family, but not as a public transportation means. If you think it is deem appropriate, why KL don’t use vans instead of monorail and LRT?

I do see some improvement to be fair with. Bus drivers have uniforms now. But their busses are still in pretty bad shape. Try your journey to Tuaran and have a seat beside the van driver.

You may surprise in some of them, there is nowhere to plug in the safety belt. This is true not only for outside city mini bus area such as Tuaran, but for KK and the surrounding area such as Beverly Hills and Putatan as well.

The worst part of public transportation in the city is because they are highly unpredictable. The time management and schedule is far from efficient, it is highly unpredictable. It is not easy for Government to monitor and to supervise, even though they tried.

Most of bus operators are individuals and small operators under loose governance of Persatuan Pengusaha Pengusaha Bas Mini Bumiputra Sabah - (PPPBMBS).

It is timely for government to introduce the concept of consortium and conglomerate of all bus operators in the city, to start with. For example, bus transport in KL operated by 11 major companies only. Under this concept all bus operators unite themselves under one or several big companies that will benefit all rakyat.

For companies, they will enjoys greater degree of efficiency or “economies of scale” and commuters on the other hand, enjoy a better, convenience and reliable transport service.

Maybe it isn’t fair to compare Sabah transportation with those in Kuala Lumpur at present as the gap terribly huge. Say, compare ours to mini buses that once also available in KL.

The mini bus (1975 - 1998) was responsible for servicing nearly 60 different routes, but this was taken care of by only three major companies while smaller operators were allowed to service certain areas only.

Apart from mini bus, we need to observe on what is going on with Sabah State Railway – SSR. It is a real concern on how do we look at it. Should we look into it from only historical value, or from indirect economic potential and gains out of it such as from tourism, or from truly economic point of view?

SSR director seems proud for the term of "The Land of The Last Vulcans". In fact, SSR (1896) is only 12 years younger than Keretapi Tanah Melayu - KTM (1884). Both have been with us since the colonial era but as it is now SSR is dying and KTM is very much alive.

Recently, the federal government charged KTM to work alongside SSR to undertake short and medium term works on the railway to enhance its safety. This included rehabilitating the track and signalling and also overhaul of the rolling stock in order to ensure continuation of service.

But I doubt that SSR will ever be significant again to the state public transportation. Present day railway begins at Tanjung Aru and ends at Tenom with the to distance of 134 Km. On the other hand, Pan Borneo entire highway system is expected to be about 1047.18 km once completed.

I think the economic solutions; to shut it down forever is always the best option. Unless of course, somebody can convince on its value to tourism.

Source: Daily Express Newspaper, 2nd March 2008. pp.17

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Subsidies are not something wasteful

Written by arimi sidek

Government should consider gradually reducing the subsidies given to the people, in order to prepare them and the country for stiff competition in the future, say Tengku Razaleigh Hamzah (“Govt should consider reducing subsidies gradually: Razaleigh” DE 5.2.08 ).

I can understand that our government strives for mindset change of Malaysians. This includes change from subsidy mentality to self sufficient mindset.

Note: This is a reproduction of my article that was published in Daily Express newspaper [Sabah], aims to cater wider and more serious audience on the matter.

In January, Deputy Prime Minister, Datuk Seri Najib Tun Razak was quoted as saying that if government continues to subsidise fuel it may not be able to build schools, universities, hospitals and the like.

It likely indicates government attitude toward subsidies at present. They suggest that subsidies are the total waste of resources to our economy. I suspect this has something to do with economists as they advice government on the issues.

Perhaps Malaysia’s economists are ready to rewrite the foundation of modern macroeconomics by introducing new economics theory on subsidies. As the existing one, I dare to say here that they are not a waste at all.

I write this from macroeconomics perspective, to share my view with policy makers, economists as well as general public. I believe correct perception on subsidies is necessary rather than to treat them simply as financial burden and of pure waste.

John Maynard Keynes (1883 – 1946) advocated the idea of active government role in economy either in the form of public works of subsidies. Subsidies are among those methods ever tried by President Franklin D. Roosevelt as USA struggled with depression in 1930s. Reluctantly, he then adopted Keynes method in large scale geared US economy toward full recovery in 1944.

1930s depression, Roosevelt, and Keynes are the true sources of modern macroeconomics as far as government active spending activities such as provision to build schools, university, hospitals, etc. which known as "G" in macroeconomics, are concerned.

It was during depression that economics theories rigorously tested and many had been rewritten. Without Keynes, 1930s great depression, and the open mind of US president at the time, we probably never heard of physical policy, monetary and growth policy as we understand now.

Subsidies simulate spending in wherever sectors they go to. In households sector, they increase households spending. If subsidies go to business sector, they boast businesses spending (or investment). Since there are more spending activities, Gross Domestic Products (GDP) increases.

Not only GDP increases, but the amount of increase is much bigger than the initial amount of subsidies. This is because, money changing hands so many times in the economy within a year. The impact known is as "multiplier effect", where multiplier estimates value of any country is called as "k".

More GDP means more production and government gets more income from taxes. Subsequently, government can use the additional tax income to build more schools, universities, military etc., as necessary.

I will not crack your head with statistical antics here, but I found none of official key statistics pointing toward this direction as far as subsidies are concerned.

Lets calculate how far the RM35 billions of government’s fuel subsidies gone to. When government subsidized fuel, it means government pay on behalf of households and business sectors. Hence, Malaysians no longer have to pay RM35 billions worth of fuel. It is as if they have “extra” RM35 billions of money in hand to spend where necessary. If “k” value is 5, multiply RM35 billions by 5 we will get RM173 billions.

Therefore, RM35 billions fuel subsidy boasts additional production worth of RM173 billions in annual Malaysia’s GDPs. Let say government taxes mere 8pc of RM173 billions. That is 173 X 0.08, equal to RM14 billions.

Therefore, RM35 billions worth of subsidies create two major impacts in economy. First, it creates additional RM173 billions of GDP.

Second, government gets additional RM14 billions tax as “rebate” and the net amount of fuel subsidy actually is RM24 billions instead of RM35 billions. Talk about being competitive and subsidies are in fact one of the best government tools to speed it up.

Active spending, "G", does not permit government to have the luxury as much as subsidies in term of “rebate”. No, unless government starts to impose tax on schools, hospitals, military and the like, and this is highly unlikely.

Subsidies are always of better choice for steady economics growth in long run. Hence, it isn’t fair to focus solely on the real amount spent on subsidies. Instead, what the economy benefited from subsidies for example in term of GDP growth had to be taken into account.

In this view, RM24 billion net fuel subsidies are actually better than to let domestic fuel price fully exposed to open market supply and demand, i.e., to increase fuel price. That is definitely “kamikaze” and we actually are going many steps backward. Please bear in mind, it was becauseof shortcomings and failure of classical thought that Keynes emerged as savior. Later, those with this line of thinking are being called as “Keynesian”economists.

For believing that market forces (supply and demand) will magically adjust everything for the sake of competitiveness, what else can be said? True, what goes up will come down. But in the case of fuel price, once it goes up, it drags the whole general price index of the country along. In capitalist market system, the price may fall in future, but general price index will most likely not, due to a very simple reason – profit maximization placement above social obligation is the businesses mean. At the end, we get only overall nominal increases in GDP and personal income.

As far as the comparison between Malaysia with Singapore and Indonesia, I honestly can’t remember that Malaysia's economy is actually being modeled after them.

I believe Malaysian economists and policy makers always maintain UK and US as economics model base so far. What puzzled me is they don't stick with the duo when it comes to subsidies. They started to compare Malaysia with other countries such as Indonesia, Thailand and Singapore instead. That is terribly lame comparison.

The fact is that, until now USA and UK governments maintain subsidies as an integral part of government spending. Take USA for example, around 13pc (USD367 billion) of 2007 federal government budget is for unemployment and welfare alone, and these are subsidies! The amount is bigger if we calculate all types of subsidies in the budget.

Non economics solutions, instead of purely economics are required if it is all about mindset changes or “paradigm shift”, or for competitiveness reasons.

Change the people mindset, they will not ask for subsidies anymore. But so long government exists and collecting taxes, subsidies are there to stay perpetually, mindset change or not, or, whether people ask or not.

I really wish some good economics responses to prove that my economics understanding for more than two decades IS wrong.

Source: Daily Express Newspaper, 17 Feb 2008, pp.15.

caveat fair use notice

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Scrap JPPS!

Written by Arimi Sidek

SABAH need to tells Fed to scrap Jabatan Pembangunan Persekutuan Sabah or JPPS in no time. It is truly a misfit in state administration.




Timely simply isn't a word to describe it.

Not a single study even required doing this. Sabah doesn't need it in the first place. Sabahan don't need it in the past, now nor even in the future.

Fed budget shall be channeled out to state government, and let the state manage them at once. Parallel government is not necessary. At least this is what being practiced in other states.

As I said, no study required. No assessment necessary. I don't think there was a study of any kind ever-conducted prior to it existence back in early 1990s.

JPPS exists merely because Fed wanted to punish Sabahans because they let opposition in control of the state governance. And creating JPPS was easy. Fed simply sent a few government officers, let them find modest premise with some furnitures. Then, this department virtually in control of everything that concern Fed money in the state. Even Chief Minister need to consult JPPS from time to time!

It was punishment; make no mistake about it. This is similar to “wang ehsan” that suddenly emerged out of nowhere in Terengganu whenever Pas came into power.

If Fed thinks JPPS is still necessary, then it shall be expanded to Selangor, Kedah, Pulau Pinang and Perak from now on.

If Sabah state government feels JPPS is necessary, then it is truly a letdown to Sabahans.

JPPS staffs just a tiny drop in the ocean compare to the whole Sabahans. Just absorb them to any available Fed departments. Fed should be responsible for, as they created the whole mess.

JPPS is less than insignificance to Sabah. Being in Sabah, JPPS is equivalent of saying that Sabahans are morons, incapable to manage their own state.

And lastly, this is nothing to do with “anti orang malaya” thing, if there is such sentiment ever exist in Sabah. Far from it. It just about crap down the unwanted hog.

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Mengundi di kampung

Written by arimi sidek

Pilihanraya 08 Mac 2008. Semacam pesta di kampung kami. Restoran sentiasa penuh dengan para pengunjung yang bertali arus.



Orang-orang BN dengan penuh yakin mengatakan calon mereka akan menang. Orang-orang PKR juga serupa. Masing-masing mengata calon lawan. Minum dan makan pula bersebelahan meja, di dalam restoran yang sama.

Tauke restoran pula tersenyum lebar sampai ke telinga. Tidak kira sama ada pembangkang atau penyokong yang bertandang, pendapatan tetap berganda-ganda berbanding dengan hari-hari biasa.

Saya mengundi di kampung sendiri. Memang tidak pernah berubah sejak mula-mula didaftarkan sebagai pengundi. Pada hari berkenaan, saya menunaikan tanggungjawab kepada negara agak lewat, lebih kurang pukul 10 pagi bersama-sama dengan ibu serta kakak saya.

Dari jauh lagi kelihatan saudara mara, ipar duai dan sahabat handai berbondong-bondong ke pusat pengundian. Tidak hairan saya mengenali begitu ramai pengundi yang datang, ini kan kampung saya sendiri.

Satu-satunya pondok parti yang didirikan lebihkurang 30 meter dari pusat mengundi ialah Pondok Barisan Nasional. Cikgu Arif kelihatan ceria. Anak Cikgu Chemat jadi kerani semakan di pondok berkenaan. Begitu juga dengan Cikgu Tiah (guru KEMAS) Kg Pantai.

Untuk tidak menghampakan mereka saya juga menyemak perincian pengundian saya di sana walaupun saya tahu, petugas SPR di kawasan pusat mengundi akan juga berbuat demikian sekali lagi.

Berbaris di pondok parti, kemudian berbaris lagi di hadapan kerani SPR, juga untuk membuat semakan. Si Anu di sebelah saya diberikan kertas maklumat yang mempunyai lambang BN – Oleh kerani SPR (perempuan) sendiri di hadapan saya.

Naik ke tingkat atas tempat pembuangan undi, si Anu bekas classmate saya menjadi pegawai penyemak untuk parti – dengan jeket berlogo Barisan Nasional.

Rasanya peraturan-peraturan pilihanraya bukan sesuatu yang difahami sangat, diperhatikan sangat. Bagaimanapun inilah tempat tumpah darah saya.

Saya sempat merakamkan gelagat para pengundi pada hari berkenaan. Para pembaca bolehlah melihat video berkenaan dengan mengklik link ini.

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