Opinion: Curious Case of Unemployment
There’s been a rising debate on unemployment recently sparked by Brunei Times in their article entitled “Chasing after Brunei’s runaway scholars“. Now it deals with the scholarship programme, one which I am indirectly associated with.
But really what has been touched upon really deals on job prospects. Many of whom says that the main reason it happened is because of the lack of career opportunity and lower salary offered compared to other countries. Hey the average working salary in Shell Brunei is lower than in Singapore or in Malaysia, and with the same qualification a student can apply for a working expat visa, fly off, work there without much hassle. So is that not an opportunity worth taking?
But most importantly: Who wants to work in an environment that do not provide the ‘right’ environment and ‘right’ salary for them to ‘grow’?
But since the scholarship award has strings attached to it students who are reluctant to be ‘bonded’ are poised to stand their ground. Those 20 students that did so stayed abroad in a passive aggressive manner. Thus the government is calling them, coaxing them, and even legally threatening them to come home and work.
Those on the board of education are not really happy with those running away from their ‘bonds’, and they have every right too do so: no one likes an ingrate. What is particularly infuriating for them is to read these honest comment section that would easily embarrass those in charge; alas they get honest feedback. And alas the power of the internet in front of our very sights.
Anyway a commenter sarcastically told how the government is to be blamed because of the current high unemployment rate; he then asked this question “Did JPKE actually keep track of the number of workers employed after every job fair?” Alas the comment got very popular.
But really what really piqued my interest is the fact that ‘many of the scholars who went home are still unemployed(I translated his sentence from Malay)’. I bet it is not only those scholar students but those studying in the local institutions as well namely UBD, ITB etc.
The question now is why is that? Why the high rate of unemployment in the nation?
It reminds me of J.Paul Getty‘s memoir “As I see It“ how he scorn young Americans who would be all mad and aghast of not having the ‘opportunity to work’ when the local newspaper themselves have not ever stopped advertising employers for positions of work! Looking back at Brunei Times or Borneo Bulletin, have you ever seen a day without any jobs advertised?
It makes me sad too knowing how our young men and women are crying to get a hand-out from the government as if they are our parents. As if we have an entitlement over them. Grow and be self-reliant for God sakes!
When I was in Maktab Duli, in a time when my family have money problems do I go out to the government agency and ask for a job?
Meh not even once.
I became a waiter in Gadong to support myself to buy my own food. I went out around the neighbourhood to sell used DVDs and CDs, and make errands for my customers. I even sold foods during school charity events.
After the holiday I set up my businesses where I refurbished and rented my granddad’s house. Cemented his road with my ‘uncle-uncles’ so my tenants would have good parking space. Set up a spaghetti booth to sell in Yayasan, and became a freelance real estate agent(though I didn’t succeed in this one).
My family supported me in this and the money that was acquired through hard work and dedication taught me that there is no such thing as easy money. I had to work for it.
So coming back to those whose whining of not being able to get a job even though you are bonded that is actually a freaking good opportunity! To strike your own path and build your own businesses! I-centre and BEDB is giving you guys the support to launch your enterprise, so why not?
Or perhaps work or intern for a private company. A friend whose taking a real estate related course commented how he learned more in a private company more than his friend who worked in the government’s Ministry of Development.
Mind you if those labour expats now living and working in Brunei are doing their job dutifully for BND$300-BND$600/month then who are to complain about getting a job? They went outside the country and lived for pennies for a long day work man! Without those Indonesians, Indians, and Filipinos can Brunei’s service and labour sector work for itself?
Anyway, the idea of writing this article is just take upon the unemployables the initiative to take jobs and not depend to much on government’s help. They do have their own weaknesses but they have provided the opportunity for man and a woman to work for a days’ worth of pay to begin to work in whatever field they may choose; all within a secure environment.
To close this article let me bring to you a quote which I found in J.Paul Getty’s Memoir, a quote from Abraham Lincon:
“You cannot bring about prosperity by discouraging thrift. You cannot help the wage earner by pulling down the wage-payer. You cannot further the Brotherhood of Man by encouraging class hatred. You cannot help the poor by destroying the rich. You cannot keep out of trouble by spending more than you earn. You cannot build character and courage by taking away a man’s initiative. You cannot help men permanently by doing for them what they could and should do for themselves.”
Brunei’s Brain Drain
The debate on Brunei’s brain drain has again hit a feverish pitch since Hardware Zone published a post entitled “Very severe brain drain as Brunei falls into decline, talented Bruneians leaving the country“. Citizens like myself are only too indifferent to the negativity surrounding the subject but it kind of begs the question: Why do many of the talented and skilled Bruneians leave the country?
So I made a social experiment in facebook asking the local audience between choosing to renounce their Bruniean citizenship for an American one with $10,000 ‘start-up’ living capital or maintaining their citizenship status as it is under the Sharia objectives that the country’s heading toward. What I’ve got was a fairly decent and balanced reply. Most would maintain their citizenship on the basis of familial ties, comfort, and security. Another argued that there’s beauty in Shria law, to that of Islam it is a perfect law given to humanity by Providence.
And……….some equated my monetary statement as heartless. Like you can’t replace your family with that $10,000 or along the lines of “you are a traitor for even thinking that!”. Anyhow, this is expected.
The point of the question is to gauge and challenge the basic beliefs of locals that renouncing one’s citizenship is not bad at all. Instead of looking that process in a negative light, or to call it the pathway for ‘traitors’, we should treat it as a key to our survival and growth. Because we are living in a modernized world everyone is going ‘international’ and we should not ignore the fact that those who work abroad will attain the right position and skill sets to bring about real change. The fundamental idea of going international was cemented by Aussia Billionaire Lindsay Fox after he advised Bruneians, in a UBD talk, to leave the country for five years to learn the ‘ropes of the new trade’ before coming back and building it up for the better. Though five years might be extended into decades, will the locals come back to help once oil and gas is gone? You bet most of them would.
The second point is to respect others decision in achieving a better living standard elsewhere. If the local institutions cannot accommodate their needs then it is up to them to renounce their citizenship – this is a globalized world after all. No one is ever morally indebted to anyone, let alone the government. Do realize that how much money has been ‘lost’ over those doctors, it is up to their choice to lead their lives for the better(so long as they pay their monetary debts!). Preaching for nationalism and philosophy is over for these citizens. As a Abraham Maslow put it: Humans main motivation is in self-actualization. Without the framework for personal growth then other countries will snatch and utilized their skills in reward for greater pay. promotion and lifestyle. This decision should be respected.
Thirdly, there’s little study made over the motivation to renounce their citizenship. Without adequate knowledge and understanding, the calls for them to come back is only hot air for them. It is thus quite right to speculate that Brunei does not offer better opportunity for self-growth, the right political framework to give representation for the middle class, the right markets to scale their business or provide the right educational facilities for their children. To compare Brunei’s general economy to that of USA or Indonesia….well you can’t. The latter countries win and it is this mindset which will be taken not only by Bruneian entrepreneurs alike but by the institutional investors and businesses out there.
Why is the writer writing this article? Well, to share an oft-forgotten insight that ex-citizens are not traitors, back-stabbers or ingrates. To have this mindset is to let rule the mind of decision makers to confine the people within their comfort zones and not letting them meet the challenges posed by global competition.
This inevitably goes to my next point: Future Scholarship students SHOULD NOT bore the brunt for those seniors who did not return back home. I don’t accept the MMI interview process. I don’t accept the point on how it will qualify who will be “loyal” or “best fit to serve” the country. What this does is to reduce the number of Bruneian scholars. And I find is repulsive to see given the need for development. On the contrary, we should do best in utilizing those oil and gas to send more and more each year. Yes, there may be problems once in awhile but it does not help reducing and squeezing the potential simply because of citizenship renunciation.
If the writer is given authority, he’d devise a policy whereby scholarship students who opted to staying and working outside the country to be given a 10 year payback period on the scholarship-turned-loan. It will not be that hard for them to pay it back considering the bigger opportunity they will gain through working abroad i.e. greater salary, benefits.
Why should decision makers tolerate Brain Drain now? Thus the whole article is dedicated on answering this question.
To conclude, I believe that the negative mindset towards Bruneians leaving the country and renouncing their citizenship for the better should change, that they are reasonable and logical adults who will not be impressed by tradition, nationalism, or existing philosophy other than meeting their need for self-actualization. Locals and especially decision makers should learn to understand the motive. If they realize the ‘whys’ and ‘hows’ they’d too may do the same too – as I hope you do too. Furthermore, I find it repulsive to see the damaging trend that is being done to the upcoming scholars. This should change. I believe that by internationalizing Bruneians is the best step towards achieving long-term progress and survival. The sooner we realize this, the sooner we can build Brunei effectively.
Being Bruneian, afterall, is more than just paperwork.
Related articles
- Brunei’s Brain Drain Revised (and other trivial matters) (amotimes.com)
A Tale of Two Oil Kingdoms: Brunei’s Curse and Cure in a Kingdom Far Far Away
By Mr. Burgundy
One is a country making up a tiny proportion of the hot and humid dense tropical jungle island of Borneo whilst the other takes up a huge swathe of the cold and harsh western portion of the Scandinavian Peninsula. One quick glance and it’s hard to see the similarity between the two. But the Sultanate of Brunei and the Kingdom of Norway have a few things in common making it worthy of comparison. From this comparison, in this humble writer’s opinion, we can learn a thing or two from them that will substantially improve Brunei’s situation that of which is inflicted by the curse of the black gold. Indeed, ASEAN and Asia as a whole can also take lessons from Scandinavia, despite the immense differences in temperature.
The Nordic countries are the world’s best governed according to The Economist hence since it’s a given that we should implement best practices, we should try and emulate their way of governance as best we can. And like a kidney transplant, not just any will do. We need to find one that best suits the receiver, Brunei. Among the Nordic countries, Norway fits the bill. Why? A few things come to mind.
First of all they are primarily an oil-exporting country just like us, and suffers from the same problems associated with our economy. That includes the concern that much of Norway’s human capital investment has been concentrated in petroleum-related industries and an economic structure that is highly dependent on natural resources. This makes economic growth highly vulnerable to fluctuations in the demand and pricing for these natural resources. Because of the oil boom since the 1970’s, there has been little extensive government incentive to help develop and encourage new industries in the private sector. Sounds familiar?
The Norwegians have also created a sovereign wealth fund (SWF) called the Government Pension Fund of Norway which is part of several efforts to hedge against dependence on petroleum revenue. It is a fund into which the surplus wealth produced by Norwegian petroleum income is deposited. That’s the second thing Brunei already has in common with Norway. Brunei’s equivalent would be the Brunei Investment Agency, also a sovereign wealth fund into which the surplus wealth produced by our petroleum based economy is deposited and reinvested. The resemblance is uncanny.
Thirdly, Norway and Scandinavia as a whole are renowned for their big governments and expansive social welfare policies. Here too in Brunei, we have a bloated public sector and is world renowned for its welfare policies so much so that we allowed ourselves to be called the “Shellfare State”. But this is where the similarities end. Now the real comparison begins. What Norway has done differently to Brunei has made all the difference in making Norway a better place to live in than Brunei at least in terms of wealth and economic policy and its sustainability. Like us they got the Dutch disease but they then dressed it up as a Halloween costume and went trick or treating for candies whereas we sank ourselves under a blanket of bureaucracy hoping it’ll one day go away.
As this writer is a proponent of a small and dynamic government, arguing for a Nordic model of government seems hypocritical. But moving Brunei towards such a government will involve huge social and political upheaval and unlikely to happen in the near future hence his argument for the next best thing available without the pandemonium, or rather to a lesser extent of it.
The big issue of this essay is the argument for the retraction of fuel subsidies and the adoption of Norwegian policies in this area. There are many arguments against fuel subsidies and one economist even goes as far as saying it is the world’s dumbest transportation policy ever. Why? In the developed world, countries do not tax enough on fuel to counter the negative externalities produced such as pollution and loss of economic activity due to congestion. What’s worse is when a developing country actually subsidises people to drive. Let’s use Egypt as an example, a perilous state with an equally perilous government finances on the brink of collapse, spending 30% of its expenditure (USD$17.4 Billion) on fuel subsidy alone even though that amount could have been used for other more beneficial use for society such as education, healthcare, nutrition, economic development or even tax cuts for the poor. Is that wise?
Now you may say “oh, but Brunei isn’t in that state”. But in 2007 alone, Brunei’s fuel subsidies could have funded 2,880 low-cost houses, 20 health centres, 12 schools, 100,000 new computers for schools, 1,400 scholarships for university students and 170 kilometres of new roads according to a subsidy awareness campaign pamphlet that year. Imagine that. The government could’ve upgraded our bumpy Brunei-Tutong highway and extend it from Muara right up to KB, add another lane on each side and make it the Autobahn of Asia.
Let’s compare it now with Norway. In Brunei it is BND$0.53 per litre whereas in Norway it is BND$2.12 per litre. To put it into perspective it will take you BND$21.20 to fill up a 40 litre car tank in Brunei and the same amount in Norway would cost you BND$84.80. Norway is ranked second in the world for purchase of gas. So why would anyone in Brunei accept paying BND$84.80 as the norm? They simply wouldn’t. But why then would the Norwegians accept this? Norway is unusual in that it’s the only major oil producer with expensive gas (this is the road less travelled). Instead of subsidizing fuel, they use oil profits for services provided by their welfare state government, such as free education and savings for infrastructure improvements and so on. In Brunei’s case, since education is already free, these fuel subsidies could be diverted to investments in infrastructure particularly the transport sector, which despite various initiatives (recently, the introduction of colourfully-coded buses) have failed to garner the public’s interests. If that previous campaign pamphlet was right, we could’ve built a high speed rail link to and from KB reducing congestion and fatigue for those poor daily commuters and hence increasing efficiency and economic activity. That’s one very good reason why fuel subsidies in Brunei, and indeed in ASEAN and Asia should be scrapped.
Of course it won’t go well with the public who have long since enjoyed the benefits of such a policy and it would cause an uproar as it has in several ASEAN and Asian countries where subsidies have been merely slightly reduced. It won’t be a popular government policy but the government will have to compensate them through a give and take basis. As subsidies are reduced, wages should rise to compensate the loss of utility for the benefactors of such subsidy. Brunei is in a better position than other countries to make this move. If it can make the move from a parallel legal system to Syariah law (which the writer’s moral conscience fully supports) in the face of widespread public condemnation from the West and some closer to home, then it can totally do this one tiny thing in the face of domestic public opposition, especially since it is counterbalanced by a raise in wages to counter the rise in fuel costs along with the benefits that arise for the population when those subsidies are spent elsewhere.
But that is not the end of it because this writer also proposes the implementation of taxes on fuel in order to make them more expensive as is being done in Norway to fully counteract the negative externalities produced by oil. This will add to Brunei’s coffers for other use such as developing an alternative source of energy for example. Again, initially the rise in fuel costs to the public can be negated by a rise in wages, funded perhaps partly by the income freed from subsidy and gained from taxation. Or perhaps, there is another entity that can offer its assistance, the Brunei Investment Agency.
As was mentioned earlier, the Brunei Investment Agency was created as a sovereign wealth fund (SWF) into which the surplus wealth produced by our petroleum based economy is deposited and reinvested domestically or abroad in trust for the people of Brunei. Norway has its equivalent in the form of the Government Pension Fund of Norway. The difference between the two though is striking. The Brunei Investment Agency (BIA) is a remnant of its former glory, estimated to hold USD$100 billion in assets in its heyday. Now it is estimated to hold a mere USD$40 billion and ranks 25th among other behemoth SWF’s in the world. But who knows what the real figure is because BIA is considered to be among the least transparent SWF out there. What is going on with our money? This is in pale comparison to Norway’s SWF which ranks 1st in the world with USD$803.9 billion worth of assets worldwide!!! And every single one of the 5 million strong Norwegians have full transparency over the activities of their fund. That is 8 times the worth of BIA at its zenith and 20 times worth BIA’s estimated assets now. 20 times!!! When calculated at a per capita basis, if everyone in Norway was given a share of their fund’s assets today and Bruneians get a share of BIA’s assets today it would amount to USD$160,780 for each Norwegian and USD$97,089 for each Bruneian though for us it depends if the value estimated by these foreign research institutes are true. It is certainly true for the Norwegians and their transparent SWF. The issue among Norwegians nowadays is how many percent of that oil fund they have should spend every year and how to organise the beast. Currently they can legally use up to 4% of it to fund their yearly budget. This is definitely an enviable position to be in. The key to learn from this in the Bruneian and ASEAN/Asian context is that transparency brings about accountability which brings about progress. From USD$400 billion (3rd rank) in 2009 to over USD$800 billion (1st rank) now that’s progress. Progress that can secure a nations finances for many years to come. . Good governance definitely doesn’t hurt.
In summary, The Nordic countries are renowned for their good governance according to The Economist. Brunei should take example of their model of good governance on a macro scale and on a micro scale such as simply having good governance and transparency in our SWF. Our economic policies should also be aligned to what we want to achieve, the example given here is that of reforming fuel subsidy policies and taxation for a better public transport system. Indeed ASEAN and Asia as a whole can benefit from this, not just Brunei. Norway provides some answers and an alternative as to how Brunei can tackle its black gold curse. They might not have fully escaped the Dutch disease either but they sure are in a better position than us. The shortcomings of this essay’s arguments are probably aplenty but the shortcomings of our beloved nation Brunei are even more chronic in our crawl to the year 2035. Whether these arguments ring a bell in the higher echelons of Bruneian decision makers remains to be seen. Like the time you took reading this, we will eventually get to the end of it and start anew but it might take us beyond 2035. You’ve survived reading this far. Congratulations. But after reading this I’m sure you very well know that there are tons of things Brunei has to fix in order to achieve its goals and aspirations and this is just one lonely view among many.
This is a cautionary tale of two oil kingdoms, one took the road less travelled. And that has made all the difference.
THE ROAD NOT TAKEN
Two roads diverged in a yellow wood,
And sorry I could not travel both
And be one traveller, long I stood
And looked down one as far as I could
To where it bent in the undergrowth;
Then took the other, as just as fair,
And having perhaps the better claim
Because it was grassy and wanted wear,
Though as for that the passing there
Had worn them really about the same,
And both that morning equally lay
In leaves no step had trodden black.
Oh, I kept the first for another day!
Yet knowing how way leads on to way
I doubted if I should ever come back.
I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I,
I took the one less travelled by,
And that has made all the difference.
Robert Frost
Related articles
- Realizing Brunei’s Economic Potential (amotimes.com)
Realizing Brunei’s Economic Potential
Brunei Darussalam, the country situated in the very centre of Southeast Asia has so much to give in the region. Not so much of its petrocurrency as many would think of but in terms of human potential, Islamic finance, and location as a trading hub. These are some of the top three identified industries that could ultimately contribute to our nation’s economic growth and ultimately the nation’s survival.
But is the nation too complacent with oil money than to develop leaders to head on these projects effectively? If so what would be the consequence of our current leaders today?
Let’s look back in history at a time when Spain was at its dynastic height in the 15th Century. Their ascent to power were fueled by the discovery and exploitation of Silver and Gold in South America. Nothing seem to slow their growth down in their ever-extending conquest of nearby land and sea. Every neighbour with similar intent seem to be terrified of their wealth and power.
One of the neighbours was the Dutch. Once a colony to Spain, they rebelled and fought against the invading Spanish kingdom. Under the call for independence, they saw that the only way to beat the Spanish was to focus in economic growth.
From this philosophy came the financial innovation that would one day dominate and shape the world we live in today. It was during these crisis that they invented the Amsterdam Exchange(Stock Market), Dutch East India Company(Joint-stock Holdings company), and Bank of Amsterdam(Central Bank).
With these tools, the Dutch were able to finance their wars effectively and conduct trade across the Asian peninsula profitably. It was a key instrument in sustaining its economy and building the wealth of the nation.
When the war came to an end, the Dutch emerged victorious. Not because the Dutch won the war but because the Spanish lost it.
It began with Spain’s tendency to finance everything with money. In raising up an army and purchasing weapons in their conquests, they utilized gold and silver as their main source of exchange. This method became the anathema for the economy because 1) their expenditure effectively devalued the gold and silver metals 2) it pushed prices of basic necessities up the ceiling 3) this leads to the weakening of the kingdom’s military and political prowess in the process.
The result was devastating. From 1600-1650 the monarch accumulated deficits and produced continous internal strife that ultimately defaulted the country not once, not twice but 16 times and thus dethroned the ruling body of its time.
On another hand, the Dutch continued to thrive and built themselves into a super-economic entity that rivalled that of Great Britian during its imperial height. Through the mercantilism exchange, the Dutch became wealthy and powerful. It is in this state that also gave birth toliberalism.
The illustration only serves as a case study on how damaging it is for nations spend its way out of trouble. This philosophy is still with some of our senior leaders today, unfortunately.
So how can we, Bruneians move from here?
One thing for sure everyone needs to learn the importance of innovation in this global age; not simply utilizing oil and gas as an all-out solution. We need to remember these resources are just tools for the end goal.
What is the end goal then? To make Brunei Darussalam into a country which can promote commercial value in niche industries such as Islamic finance, commerce and trade, and human potential. (More will be expanded in these subjects in later writings)
Equally important question: what is not the end goal? Relying too much in petrocurrencies in solving our problems instead of utilizing our people’s innovative capacity to build new lines and methods to serve a greater lot to the public through enterprising and creative projects.
Bruneians set to gain from TPPA(Trans Pacific Partnership Agreement)
The trans-pacific partnership free-trade agreement(TPPA), which Brunei Darussalam signed to in 2005, has sparked new questions among a relatively small circle of Bruneians. The thought came as a general discussion on economic issues within the social media sphere.
The agreement piqued the group’s interest when it was found out that it is packaged in total secrecy, and was surrounded by a storm of anti-globalization protests across the internet. It caught on a feverous pitch following the ‘document’s leakage’ via wikileaks.com.
The ‘document’ purportedly calls for an aggressive stance in market liberalization and IPR protection on member states, including Brunei, that if enacted would ‘give private entities the legal power bring a nation into compliance’.
Some jokingly suggested it to be the “one percent’s wish list” because of heavy Multi-National Company’s involvement. Companies ‘include’ the likes of Tesco, Piftzer, and Halliburton( US weapons supplier in the Iraqi War).
So with the public out of the dark, and members of global private entities having access to matters, is it any wonder the prevailing controversy?
But with Brunei Darussalam already in the pact, we Bruneians, from this writer’s humble opinion, can only adopt the military motto of “To be foretold is to be forearmed”. Because really, the TPPA agreement is nothing more than the ‘next step’ for economic growth. One which represents massive opportunity for Jobs, Trade, and Investment for Bruneians.
With greater market liberalization, the strategic goal of the agreement, Bruneians could encounter massive job openings in the international field. Giving access to rich learning opportunities and experience. These could then be cross-transferred towards nation building.
Imagine our youths working in world class institutions such as Goldman Sachs, Emaar PJSE, USA’s Federal Reserve, MTV, and Harvard Business School, and having their expertise utilized in building the nation’s financial, real estate, monetary, media and educational sectors.
The booming of international demand via this agreement could boost trading opportunities and competition, which may force nations to innovate their way out of bureaucratic red tapes and inefficiencies. The entrepreneurs and consumers could, respectively, get more revenues and choice of better services or products.
Brunei’s success in meeting the aforementioned challenges posed lie on the nations’ goals placed on developing Pulau Muara Besar. The country, afterall, has an ancient deep-rooted history as an influential regional trading hub. This was during the reign of Sultan Bolkiah the 5th. As the passages of time passes, the geographical positioning still exist. And with the call for increased global trade, why don’t Brunei make a ‘dent’ in the Southeast Asian region, which alone accounts for 600 million people?
Apart from jobs and trade, one sector that could be of extreme possibilities: Investments. The opening up of the ‘bottom billion’ market could call for a boom in regional infrastructure, educational facilities, production facilities, and coupled with the ‘greater connectivity in worldwide stock exchanges’, this could make many locals, if they are prudent, gain access to higher than average returns of their original investments.
A weird thought played through the writer’s mind as he wrote this sentence: Would it be a good idea if more Bruneians band together into forming an ‘investment trust’, akin to that of BIA, and invest in properties abroad, merge or acquire public listed companies, secure or sell different asset classes, or even gain access to contracts within the international communities?
To conclude, the TPPA has its own flaws; secrecy from public and the “One Percent’s” heavy involvement, just to mention a few. In the light of this agreement, a great potential for Bruneians to secure massive opportunity in jobs, trade, and investments of businesses across the international market.
Globalization is at bay, and the Bruneians, mentioned beforehand, is preparing for the opportunity.
Are you?
