In this webinar, Dr Johan Ariffin discusses the MA63 issues, the unfulfilled promises by the signatories of MA63, and federal-state relationship with regards to revenue.
MALAYSIA STUDIES PROGRAMME WEBINAR
Monday, 17 August 2020 – The ISEAS – Yusof Ishak Institute invited Dr Johan Ariffin to deliver a webinar on the 1963 Malaysian Agreement (MA63), and attempts by the Pakatan Harapan and Perikatan Nasional federal governments to resolve unfulfilled obligations towards the East Malaysian states as stipulated in MA63. Dr Johan was formerly the CEO of Institute for Development Studies, a Sabah government think tank. Dr Johan has a PhD in Business Administration from the University of South Australia, and held board positions in Shell Timor and Petronas subsidiaries. He is also a regular columnist to the Daily Express, Kota Kinabalu.
Dr Johan began his presentation with an overview of Pakatan Haparan’s election manifesto for Sabah and Sarawak during the campaign for 2018 General Election (GE2018). East Malaysians have long perceived that the federal government has failed to implement MA63, including an equitable allocation for oil royalty and greater autonomy for Sabah and Sarawak. Pakatan Harapan promised to resolve these outstanding issues if elected, and established a commission to produce a report within six months upon being elected. Dr Johan commented that GE2018 marked a watershed since the grievances of East Malaysians were featured prominently during a General Election for the first time.
Dr Johan commented that upon assuming power, the Pakatan Harapan government tabled a bill to amend Article 1(2) and restore the status of Sabah and Sarawak. However, the bill was defeated since it failed to attain a two-thirds support from the house. Dr Johan argued that Pakatan Harapan was perceived in East Malaysia as being reluctant to implement its promise for an equitable revenue distribution for petroleum extracted in Sabah and Sarawak. In GE2018 manifesto Pakatan Harapan had promised to increase oil royalty for Sabah and Sarawak to 20 per cent, from the existing 5 per cent. Azmin Ali, then Minister for Economic Affairs, commented that the 20 per cent should be calculated based on Petronas gross profit rather than gross production (i.e. extraction) value.
Dr Johan subsequently shared with the collapse of Pakatan Harapan, the newly installed Perikatan Nasional government created a new ministerial position for “Sabah and Sarawak Affairs” under Prime Minister’s Department. The post is presently helmed by Dr Maximus Ongkili from Parti Bersatu Sabah (PBS). Despite the elevated status of Sabah and Sarawak within the cabinet, discussions to resolve outstanding MA63 issues remain ongoing. Dr Johan argues that the oil royalties issue will immensely shape future relations between Putrajaya and the East Malaysian state governments.
The webinar attracted 80 participants from Singapore and around the globe. During the question-and-answer session, participants raised topics concerning succession sentiments in East Malaysia, integration between East Malaysia and Kalimantan, resource curse, and petroleum tax in Sabah, among other topics.