AP a.k.a Approved Permit

** Ini adalah tulisan kenalan aku iaitu Penyair Purba. Bak kata beliau, sebab blog aku ni gersang dan tandus takde update entri baru, dia pun bagi kebenaran utk publish penulisan beliau.  Atas saranan Penyair Purba, dan kebetulan dengan isu harga kereta nasional ni, aku pilih penulisan bertajuk AP a.k.a Approved Permit

Sila baca dengan hati terbuka dan menilai dengan akan yg waras.

                                                                                                

Approved Permit (popularly known as AP) is a license for import based on Customs Act 1967. It is not issued solely for import of cars but this article will only focus on the AP for automotive industry. It is basically a license to import and bring vehicles into Malaysia for the purpose of trade and usage in the country. All imported vehicles are subject to AP which is currently being managed and issued by the Ministry of International Trade and Industry (MITI). Thus, we cannot buy or bring imported cars in Malaysia without AP.

AP was first introduced in 1970 with the purpose of assisting Malays in the automotive industry. It is part of the New Economic Policy (NEP) initiatives. Starting from that time onwards, the sale of imported vehicles was restricted by the national automotive policy and AP which was fully allocated to Malays companies. The allocation was later liberalised when several businessmen and companies owned by Chinese, notably Tan Sri Vincent Tan and Berjaya Group were also given AP to import vehicles.

The Malay businessmen involved in the automotive industry then set up an association known as PEKEMA. Notable companies under this association include NAZA, Weststar, MOFAZ, Pantai Bharu Holdings, Mutiara Motor and Kumpulan Niaga Mahmud Taib (son of the Chief Minister of Sarawak). The most infamous company is NAZA Group which was founded by the late Tan Sri Nasimuddin.

When the list of AP receivers was released in 2005, four people were then dubbed as AP Kings. They are Nasimuddin, Syed Azman, Hanif Aziz (former officer of MITI, also first cousin to Khairy Jamaluddin) and Azzuddin Ahmad (secretary of FAM and father in law to Singer Deja Moss). It was reported that Azzuddin has since left Weststar.

The list also includes the niece of Rafidah Aziz (former Minister of MITI) and Mokhzani (son of Tun Mahathir). Another beneficiary is Fadhil Ahmad, Managing Director of Competitive Supreme Sdn Bhd which is the sole importer for Ssang Yong (popular product is Rexton). Fadhil also wears another hat as CEO of Brooklands Motor, importer of Citroen cars. Another colourful AP beneficiary is Ilyas Mohamed, CEO of Cartrade, importer of Audi and Volkswagen. His son, Fahmi Ilyas is a racer who needless to say, relies on Ilyas to pump in the cash. Another daddy to a racer, Fauzy Hamid is the boss of MOFAZ, another giant in the automotive industry. His son is none other than Fairuz Fauzy, the new darling of Malaysian racer after Alex Yoong. Wang Selamat Sdn Bhd (money secured in their hands, LOL) is the most famous company under MOFAZ. The imported cars in its stable include Toyota, Lexus, Honda and Nissan. Not to be left out, a royal member of Kedah was also in the list of AP beneficiary. Tunku Zainol Tengku Izham of TAHB Auto is the importer of Chevrolet.

The list will not be complete without the involvement of Tun Mahathir’s son, Mokhzani who has the sole right to import Porsche. In furtherance of his interest in automotive industry, he is also the Chairman of Sepang International Circuit (another brainchild of his daddy). It was reported last year that he sold his company to Sime Darby and only retain minor shares in the new venture. He was reportedly said that he wants to move away from AP, not surprising because the oil industry is waiting for him through his Kencana Petroleum.

Discussion on beneficiaries of AP will not be complete without the other two colourful businessmen. Ahmad Kemin is AJK for UMNO JB and he is the founder of Mutiara Motors, giant car dealer in Johor. His son got married to Juliana Banos in a luxury wedding where the dowry (hantaran) was reportedly RM77,888.77. Their stable of cars includes Ferrari and Lamborghini. In a local daily report early this year, Mokhtar (the son) admitted to having twelve marquees which he shares with Ahmad. Another young gun is Shahrin Zahari (former husband of Natasha Hudson). His business partner is Malaysian Car Racer, Nik Iruwan Nik Izani who aspires to be an F1 driver.

Discussion on AP will not suffice without a brief outlook at the price of vehicles and taxes imposed by the Government. The excise duties on cars are based on capacity. Cars below 1800 cc will be taxed at 75% whilst those in 2000 to 2499 cc will be taxed at 90%. For cars above 2500 cc, the excise duties will be 105%. Bear in mind that excise duties are not the only tax imposed on cars. There is also sales tax which is about 10%. The tax on imported cars contributes to the exorbitant prices which many attributes to the Government policy of assisting Proton and Perodua. In fact, there is no imported car (brand new) with the price below RM40,000.00 (exception to small cars such as Suzuki Alto and Hyudai i10). In fact, Malaysia is one of the highest prices of cars in the world. Thus, it is not a surprise that Malaysian household debt is at its highest ever level. To put it figuratively, for a car worth RM40k, the tax to Govt. alone is RM16k.

The picture on the automotive industry will also have to include the public transport system in Klang Valley. Notwithstanding the exorbitant prices, Malaysians are among the highest owners of cars in the world. It is estimated that for every 1000, there are 997 cars. It was arguably reported that the initiative to improve the public transport was hindered by the lobby from the automotive industry. Public money amounted to Billions of Ringgit has gone down the drain in the name of public transport. Companies in charge of LRT and Monorails have to be bailed out and now managed by Syarikat Prasarana.

There were proposals to abolish AP. At first, it was scheduled in 2010 but later postponed to 2015. However, interested parties such as PEKEMA have voiced out their objections to the abolishment proposal. PEKEMA argued that its members spent close to RM2 billions and employ about five thousand workers, hence the need for protection by AP. Based on National Auto Policy (NAP), the AP will be phased out latest by 2020.

Even Tun Mahathir had his complaint about AP. In 2005, he quarrelled publicly with the then Minister of MITI, Rafidah Aziz. He said the influx of AP has affected the sale of Proton and unjustly enriched few cronies. In fact, due to this quarrel only that Malaysian finally get access to list of AP beneficiaries.

Further, it is public knowledge that those cronies with AP, majority of them have not even have a decent car showroom. With the exception of NAZA (credit to them because they do business, not Ali-Baba style), most companies under PEKEMA do not have any showroom. It is also a well known fact that Honda Malaysia has to buy AP from some cronies. That means, Honda (Chinese businessmen) do the business of selling cars and cronies with AP just take their due from that printing money machines (Ali-Baba style).

The purpose of the article is not to attack any individual or company. Instead, it is written with the sole aim of providing information for Malaysian public to chart the future of this country. Are we ready for change, not only in the business area but also all encompassing areas of life? The world has become smaller. We can reach US or China in just under the five hours time. The world is now at the fingertips.

NEP was created to assist Malays. Undeniably many Malays prosper under the system, such as proven by AP where many businessmen are now in the super rich league. It is a fact that about few hundred thousand workers depends on those businessmen and their companies. A collapse of the company will mean loss of jobs for thousand.

So whose benefits must we protect? The tycoons and select few. Or their workers. Or the public in general who suffers due to the system. Those with income below two thousand ringgit will have to fork out at least RM500 per month to own a Proton. Also those who have to ride a bike because of the non affordability to purchase a car.

It is a tough choice. It is extremely difficult for public to choose. The system and the way business was done are inextricably intertwined with the corruption and cronyism. How to avoid corruption when only a select few can enter the arena of money making in the name of NEP? The chosen ones were also largely not based on any merit. Connection and link is the main glue. It is now what you know and what is your expertise. Instead, it is who you know.

So, Malaysians, where are we heading? Am I tired of this country? It is a resounding YES. But I will give Malaysia another chance.