Bruce Gale, Patrimonialism and Public Enterprises in Malaysia: Towards A Balanced View of their Problems and Prospects

Abstract

The appearance of Bruce Gale's Politics and Public Enterprise in Malaysia* is a major - and the only book-length - addition to the growing academic literature on public enterprises in Malaysia. My purpose here is to provide a critique of Gale's provocative but, in my view, essentially mistaken analysis of the problems and prospects of public enterprises in Malaysia and to present an alternative view of these matters. This alternative analysis is not only more consistent with and makes fuller use of the data contained in Gale's book but is also less deterministic in nature and less pessimistic in its implications than that provided by Gale. In addition, it encourages the identification of the major factors which appear to affect public enterprise performance in Malaysia and which deserve careful attention in the government's overall strategy of public enterprise management. A systematic discussion of these factors is highly policy-relevant as well as timely in the Malaysian context. Public enterprises have been widely used by the Malaysian government for achieving the important goal of restructuring society. Their performance in the lasť decade or so, however, has not been entirely satisfactory and the recent spate of closures and reorganisations of existing public enterprises and their subsidiaries suggests that the government is giving more serious attention to the question of their effective management. A discussion of some important factors affecting public enterprise performance in Malaysia will, I believe, throw some light on some of the key issues and problems in the use of the public enterprise and its management in the particular circumstances prevailing in the country.