EP1 #KenaSoal | Petronas, DOGE, Tenaga Nuklear, Prestasi MYR, Pendanaan Politik, Satelit Malaysia

0:10 Peace be upon you. Welcome to the "Kena Soal" episode. with me, Shahril Hamdan. And me, KJ. KJ, this is our first attempt... ...to have a special episode... ...for the audience... ...who submit questions either via voice notes... ...or by answering Instagram stories... ...from KS or the KS account... ...and any other channels... ...we may introduce. This is our first attempt. We usually do this Q&A inconsistently... at the end of certain episodes... ...we want to make a change in 2025... ...among other things, to introduce segments...

0:56 ...or special episodes that we'll try to do once a month, to start. You can see that the studio setting is also slightly different. Yes. So, let's go for it, KJ. Maybe I'll start first. Sure. So, there are a few questions. And for everyone's information, we chose these questions... ...based on selections from the KS team... ...and KJ and I also looked at the questions we chose... ...we looked at how many we could answer... ...and we tried to group certain questions that seemed popular. And one of the popular ones, KJ, that I want to start with first... 'SYFQAR' asks, "How is Petronas' rightsizing affecting the nation's economy?" 'paktam_nizama' asks, "If there is no more Petronas in another 10 years, what will happen to Malaysia?"

1:43 He said this because Tengku Taufik (TT) himself said... ...if we don't do this rightsizing, don't reduce these workers... ...Petronas could be gone in 10 years. That's what TT said. All of that is related to Petronas-Petros... and I have no doubt it came about because of the announcement we mentioned earlier... ...by Tengku Taufik regarding Petronas' plans for this year, to reduce its employees. I'll start the review to answer questions regarding Petronas. First, remember that Petronas, in the past 10 years... ...went through a retrenchment process of... about 1000 people. 1000 people out of 51,000 total employees at that time, in 2016. At that time, I was also in the oil and gas industry, and there were a lot of...

2:32 That was the era of low oil prices, right? Very low. As a result, from what I read the other day, 6 to 7 thousand people who work in the oil and gas industry have already lost their jobs. And that is true across the industry. So that was a time of low oil prices. The question now is, what is the amount this time? And what is driving this to happen? Because there is no low oil price situation today. And what motivates, as stated by Tengku Taufik, he was quite clear that it had nothing to do with the Petros issue. when we hear statements like this, it is also about a broader question around automation and artificial intelligence.

3:22 Because Tengku Taufik also said that the ones who will lose their jobs are what are called "enablers." This is also corporate speak. "Enablers" are probably admin staff. These admin staff are easily replaced by automation and artificial intelligence. So maybe those are the parameters, KJ. Any thoughts, and then I have other things to say on this as well. Yes, the announcement from Tan Sri Tengku Taufik was very surprising. But in reality, maybe it's been a long time since such a bold decision was made. And this will have an impact, a political impact. Because Petronas, in English, is

4:09 the crown jewel of Malaysia. In terms of the custodian or entity that looks after our hydrocarbon assets, our natural hydrocarbon resources. And also the crown jewel in terms of contributions to the government, which amount to tens of billions every year. But this announcement needs to be made because Petronas is not the only oil and gas company in the world facing pressure. Even big, major oil companies like Shell and Exxon Mobil are also facing problems trying to reduce headcount and reduce

4:57 their operating costs. I understand from the research we have done and also discussions with friends in the oil and gas sector that the profit margin, for the oil and gas sector, is decreasing due to higher technical risks, exploration which is more... more complicated nowadays, and also possibly increasing geopolitical risks with the increasingly tense world situation. And this will also put pressure in the form of terms in the PSC, or production sharing contract, that Petronas usually signs with international companies,

5:47 and perhaps the margins there will also become smaller. The second is, of course, energy transition. And this matter, although Petronas is also involved in carbon capture and so on, we have to admit that there is a trend... although I see that the trend has slowed down a bit, there is a trend to transition from hydrocarbons to renewables and although I think that renewables for now, later there will be questions regarding nuclear, for now, renewables will not completely take over fossil fuels, but the trend of the next few decades or so is in that direction,

6:37 and that will indeed put pressure on traditional oil and gas companies, including NOCs, national oil companies like Petronas. I think what KJ emphasized was, to remind us that other oil companies are also going through the same process, even though oil prices are not falling. For example, KJ mentioned Exxon. I also read about BP. BP, this year, January 2025, announced plans to cut 7,700 positions, and the company attributed this reduction to increasing efficiency through digitalization and AI. And another interesting piece of data: between 2019 and 2024, the amount of oil production in the United States increased.

7:24 But the number of jobs in the oil and gas sector in the United States is falling. So again, because of automation and AI. So this is indeed a long-term trend where Petronas wants to be ahead of the curve in that context. And I guess automation is a topic that we should return to many times because it's not just the oil and gas sector; other sectors will also be affected, and we should talk about it over time. Sorry, yes. A similar question. It's not a similar question, but it's somewhat related. This is from 'not Dev Patel'. Will the government look to implement a DOGE-like entity to streamline operations? Department of Government Efficiency.

8:10 So, for listeners, information for KS listeners and viewers. In the United States, there is one entity. It is not a Government Department. It is an ad-hoc entity established by President Donald Trump called the Department of Government Efficiency, or DOGE. And he took its name from the coin meme. Dogecoin. Dogecoin. Yes. Bitcoin. Dogecoin. Crypto. And the task of leading DOGE was given to the richest man in the world, Elon Musk. And DOGE has already begun their work, including abolishing several government agencies.

8:59 So, for example, USAID is a United States government agency that already exists to provide assistance to other countries for the purpose of international development. It was not abolished but incorporated into the State Department. It is difficult for DOGE to abolish it because many of these agencies were established by acts of Congress. Or this agency is a statutory agency. The one who has the key to legal power. But they have started sending letters to government officials to stop. To take an offer so that they quit their jobs.

9:48 There are efforts from the White House to avoid having to spend money on certain departments. So, he didn't break the law. The law says this department must exist. But he has a choice to -- they call it "idle." To idle this agency. So, it has happened with previous presidents where if he doesn't like the agency, the agency will still exist, but he will idle the agency. He will cut off allocations; he will not give work to that agency. So, right now Elon Musk is doing it, and he has brought in a team of 20-somethings who are trying to get data from all the

10:39 government agencies in the United States to understand whether the agency should exist or not. More or less like that. And I heard that they are trying to get data from the CIA to see if they can shut down parts of the CIA and so on. And of course, this led to a big pushback from government officials and civil servants in the United States who tried to justify their existence. So, it's typical. When someone comes to try to chop, some come and say that we really need to exist because we contribute to the government and also to the country. This question is whether DOGE should be created in Malaysia. To be brief, Shahril, I once said in our podcast,

11:26 one of the things that, if I had the opportunity to do this, would be to restructure our government. But, this is the political caveat: we can't fire anyone. But we need to start, like Petronas did with Tengku Taufik, to... not right-size, because I will not sack even one civil servant, and that has to be said. But the process to deploy them, to assign them to the tasks that I think are needed for the next five to ten years, and to complete the tasks that can be taken over by automation and even artificial intelligence, must start now.

12:11 That's what I've always said. So, yes, I think if I were there today, in the PM's office, I would say, yes, I'd have a department of government efficiency, probably run by somebody from the private sector. Get somebody bright from the private sector, but not somebody with... Elon Musk's level of mental stability -- someone who is more stable. And ask that a roadmap towards restructuring civil servants be implemented, which will take 5, 10 to 15 years, but with the guarantee that no one will be dismissed, but with the condition that it will require a deployment and also a reassignment of duties.

13:05 And the government needs to train; they need to be trained so that they can do tasks that are different from what they do, and that will take time. You can't immediately retrain a group of bureaucrats to do something else. So, I think what KJ is answering is to try to do something that is practical, that is politically tenable, that is acceptable, right? But why don't we do this, KJ? Maybe what is needed is a clear target from the government: What is the right size? To use Tengku Taufik's term, what is the right size of civil service? To have that target, and put that target somewhere in the future, say, in 10 years time, this should be the ratio, and the ratio is not just a ratio from the top,

13:51 but it's also bottom-up thinking of how many doctors would you need, how many certain roles would you need to fill, and therefore in 10-X years, that is the ratio, and therefore, we work towards that. So, I think the government needs to be brave to say this is our ratio. And this speaks to, I suppose, the problem here, KJ, is that there are not many political players, either in the government or politicians, who want to commit to something that will reduce the number of jobs. And I feel that that's a broader question, not just in terms of the size of the civil service, KJ, but in terms of legislation, regulation, regulations and so on, where we need to update our regulations to allow and facilitate automation, not to see it as a political concern. I agree with Shahril, but I think in the Malaysian context,

14:39 if I were to say that ratio, it might put a political price that is too high for any politician to try it. So, I would rather be quiet about the ratio. There's no need to mention the ratio, but when we know internally, for example, this department, in 5 years, we don't need 100 people, we only need 20 people. So, in recruitment and in retirement, we have sunsetted certain tasks. So, when someone has retired, we don't need to replace them. And for new recruits, we assign them to tasks or places where they are needed, for example, the Ministry of Health or the Ministry of Education.

15:25 And the PSD starts adjusting. Okay, for example, department X -- there's no need to mention the departments -- that we really know are obsolete or are getting obsolete, and in 5 years they will become increasingly obsolete. From 100, 20 is enough, and 80 positions, we move to another place. That can happen, but very carefully and quietly because I'm worried, yes, as usual, CEUPACS, the PTD association, and so on will come forward and say, "Oh, this is a politician who wants to kill the careers of Malay civil servants." But I want to do this, and I think I can push this through. Right, I just feel like no matter how we skin it, spin it,

16:15 it is really a reduction in jobs. And there needs to be a political plan. I don't know yet, but I'm sure, I mean, it means that, right? Automation does mean reduction in many, many roles. We don't have enough doctors; we don't have enough nurses. So I'm not sure about the net... to properly distribute on certain jobs, it's not enough, but there are a lot of roles that clearly need to be downsized if we really want to embrace automation and also artificial intelligence. But I think the main thing is, Shahril, there's not a lot of discussion and also thinking on this. There is; I don't want to say there isn't -- not true. But in terms of a concerted effort, like what was done in the United States,

17:02 whether it's good or not is secondary. But there are indeed efforts towards restructuring the government there. Yes. I think our motivation in Malaysia might be slightly different. We want to increase productivity. It's not necessarily that we think the government is bloated everywhere. Not necessarily. It's the productivity question. Yes. And productivity for a country like Malaysia must include a wholesale embrace of automation and AI. One hundred percent. Maybe one more question from me before we take a short break. Because I've talked about automation, there is a group of questions regarding education. Someone asked about vernacular schools. Someone asked about DLP. Maybe we can take that another day. Because I'm sure this question will always be asked.

17:48 And for viewers and listeners, if we don't answer your question this time, God willing, we will try in future episodes. Let's save the question. We will save it. There are two questions from this education group that I'm interested in briefly discussing. One is from 'Rish Arm'. Should people pursue studies at a higher level with the current difficulties in getting jobs afterwards? Another question is from 'Bintu Talib'. Can you share one thing you learned from your university days that is beneficial for our local university students? Maybe because both KJ and I studied at universities abroad, But I want to briefly discuss those two questions. One, perhaps I can start by saying that,

18:33 honestly, as I get older, I'm more aware that times are changing so quickly, I hesitate to give too specific advice to the younger generation regarding education and preparation for the world of work. Because the jobs we used to pursue, KJ, apart from wanting to be politicians, were during the time of Gen X, KJ, and Gen Y, me. I think there was still a feeling that if you wanted a corporate job, it's the GLC job, it's the consulting job, it's investment banking. If in that group, within that group, some people aren't even interested. Some join NGOs, that's normal, good. But what I mean is, in the context of mainstream jobs, people who go to university, get scholarships to go to the UK, that's the kind of job you usually want to go back to.

19:20 I think it's very different now if we use that example. Not many people really want to go into banking, not many people... I think still, but... My nephew, he just graduated from London, and I asked him in terms of his profession, not only him, but among his peers, the top choice... Still... Still in finance? Still finance. The returns, money? Money, money, money. Okay. But I think even KJ can agree that it's a bit more... there's more diversity. More diversity. And perhaps more importantly, what courses, what majors, what jobs they can lead to are more complicated than before.

20:07 That is one, which becomes an awareness. Secondly, although I don't dare to give too many specifics to answer this question, I think there are a few general things I can suggest for us to discuss. One is my hypothesis that the older I get, the more necessary it is for young people to be prepared for the possibility of having multiple careers in a lifetime. So, a multi-career life. Not just multi-employer, but multi-career. If possible, start with one job, then move on to another industry, then another industry. And I think that will become more common. The second suggestion is to

20:55 make sure you are very familiar with AI tools and AI agents. Are you making fun of me? No, I'm not making fun of you. Can you tell the listeners? In preparation for this episode, in preparation for this episode, I accidentally taught KJ a little bit about how to use the potential, using ChatGPT to prepare for our episode. But my point is, I think familiarity with AI tools, as they keep changing, is very important. If you were a teenager or in your 20s, I would invest so much time in that. Even today, we are investing time in being familiar with that because I think it's not just your job that might be affected,

21:40 but how you become most productive will also depend on how you master these widely-used artificial intelligence skills. And then the other part is other soft skills. The soft skills that I think are necessary are in terms of flexibility, adaptability. Okay, this has always been important, but because I mentioned multi-tasking and multi-career, and the threat from artificial intelligence, it's important to be flexible and agile in your education and your upbringing. On the last piece, on actual hard skills. So, what are the hard skills if I want to give a suggestion? And this is where I'm least confident of all my answers I gave. I thought about this here, on the way here, KJ. One, prompt engineering. So, how do we learn how to prompt AI agents and tools?

22:28 I think that's a hard skill, if you want to call it that. That's worth investing in if you're in university. In terms of courses, I'm very careful to say that I feel maybe if there were something more important or promising for the future economic returns, maybe quantum computing, something around climate tech Apparently, the World Economic Forum came out with a report saying that climate tech is an area where there will probably be good jobs in the next decades or so, robotics. KJ, any thoughts on hard skills, soft skills? What courses would you...? Not really about majors. As for the major, I think, yes, Shahril may have chosen or identified several technical majors. But I think there is still a place for those who take more general majors such as social sciences, like us.

23:18 I want to mention it because there was a question earlier that asked, "What did you learn, right?" What did you learn? What did you learn in your university days? Apart from theory, you know, what causes unemployment, inflation, all that stuff. Public speaking? No, no. This is a serious point because many people rarely mention this. It's a skill that you have. It's a skill that I have, I think. Which is, we have—well, I mean, we think we have. I think you do. The ability to take in a lot of information, synthesize, prioritize, and understand.

24:04 We are not specialists in any field, but we understand the "why" of each thing and have the ability to process it and to use that information to make decisions or conclusions and views. Those skills helped me a lot when I became a minister, for example. I went to the ministry, I'm not a doctor, right? This is something I always say, but I was able to take a lot of information, synthesize it, prioritize it, understand it, and cut to the chase, basically, and go to the crux of the matter. AI can't do that for you. Because no matter how you prompt, it will spit out various information.

24:53 You still need to understand how to use that. Even if AI exists, even if AI one day can do that, the reasoning model becomes super strong such that it can do that, but there's still a human element because there's a subjective... This is a subjective skill, right? To know how... like KJ has an example. And take from this experience, from that reading, from this study and join the dots. Even the most sophisticated AGI, Artificial General Intelligence, is difficult to create. It might be able to do that, but it's based on its own training, whereas we as humans also have our own training. Our experience, our age, wisdom, and so on are what lead to that skill. So, your point is synthesis capability, how to get it. Other human stuff, I think empathy, active listening,

25:40 these are things that are not just positive values, but I think they're important in a workplace in that kind of environment. Okay. Can we take a break? Welcome back to, what is this thing called? "Kena Soal"? "Kena Soal," sorry. "Kena Soal" isn't very catchy, unlike "Keluar Sekejap." But okay, "Kena Soal." For "Kena Soal", let's continue with a question from 'Rahman'. 'Rahman', okay. 'Rahman' sent a voice note. Let's hear you, 'Rahman'. Assalamualaikum, KS. I have a question for KS Q&A. We've been talking a lot about data center development lately. In which,

26:26 they will require a lot of electricity in the future. In your opinion, KS, should Malaysia focus on nuclear energy to meet this electricity demand in the future? For me, I think there are many Malaysian professionals who are currently serving or have served with the IAEA. That is an international organization that regulates nuclear energy. However, their expertise has not yet been utilized for Malaysia to this day. So, I hope KS can touch a little bit about this. Thank you. Okay, this is a question regarding nuclear, nuclear energy. And I also have another question. 'Ali Mada 97' also deals with the same issue.

27:12 What is your opinion on a new source of clean energy such as a nuclear power plant? Shahril, I once served as the minister responsible for nuclear energy in our country. As the Minister of Science, Technology, and Innovation. And we do have, as I mentioned, one nuclear reactor in Malaysia, in Bangi, under the Malaysian Nuclear Agency, since 1982. But this reactor, which has a power of only one megawatt, is a reactor used for research, education, and training purposes. But, I mean, I went to the reactor itself. You can see the effect where you can see the blue water, proper nuclear stuff.

28:02 And there is a borehole for us to store all the radioactive waste. In 2014-15, one of the EPPs, Entry Point Projects, these Entry Point Projects were several projects coordinated by PEMANDU at that time under Dato' Sri Idris Jala. So, under the ETP, the Economic Transformation Program created by Dato' Sri Najib, he identified several EPPs, Entry Point Projects, which could catalyze a new sector or a sector that would provide a large return in terms of national income or Gross National Income.

28:48 One of the agencies that was set up was actually a nuclear power agency. And they have conducted a study on whether nuclear power is feasible or not in Malaysia. And internally, there is already a desire to explore nuclear power in Malaysia. Or nuclear power in Malaysia. I mean, this is a long and technical subject. But I want to conclude by saying that I personally am in favor of nuclear power. But there are a few things to think about regarding nuclear power. The first is definitely a matter of safety. Although nuclear power is safe, the fallout from a nuclear accident

29:39 gives a bad image and also causes great trauma to the public. Especially those who still remember what happened in Chernobyl, in Fukushima, in Japan, and so on. So, if there is a problem or technical disruption at a typical plant, although it can be a major catastrophe, it is not like what we associate with nuclear, where the effects last for years and the contaminated area has to be vacated and cannot be inhabited anymore. But in terms of whether it's clean, whether it's efficient.

30:30 So, we have to consider safety and efficiency. The second is cost. The cost of nuclear power, the initial cost, is coming down. But we cannot shy away from experiences where costs are high, overruns, delays. So, this is one of the problems that plagues the nuclear power industry. High costs, which are still high, but are decreasing. And also problems in terms of delays in plant construction, commissioning, and so on, which will take time. Normal conventional nuclear power plants can take up to 10 years before they start commissioning.

31:18 But these problems need to be compared with new technologies. So now there are Small Modular Reactors, what are known as Small Modular Reactors. So it is not a large plant, but a smaller plant which can be built offsite and brought to a specific place. And the power used by the SMR plant is only 300 megawatts per unit, compared to about 1000 megawatts for the traditional nuclear power plant that takes about 10-15 years to commission. The small SMRs can be done much quicker. But it is still unproven, SMR. So, SMR is all the rage right now. Even Sir Keir Starmer, the current British Prime Minister,

32:05 is working to get Britain to look back at nuclear power by using SMRs, or Small Modular Reactors. And thirdly, Shahril, it concerns the issue of waste, where to put it. And also, the actual plant. Where do you want to put the plant? Because we have a NIMBY problem, Not In My Backyard. So, where do we put this plant, whether it's a conventional plant or a small plant, SMR, it takes time to engage with the local population. Why put it in Rembau, not in Bagan Dato, for example? So, that's also going to be an issue.

32:53 So, and if you want to use it for data centers, then, you know, obviously, whether it's something that's accepted by data center users, nuclear power plants. Is it green in their eyes? Or is it considered green in their eyes? Because this data center, as Shahril knows, has requirements that the energy used by this data center must come from green sources. But whether nuclear is something that they are willing to accept. So, those are some thoughts. Yes, I don't have much to add. Except to say that we have to look at it too, other countries in the Asian region have also talked a lot about the SMR that KJ explained. So, we wouldn't be the first.

33:39 I share all the concerns that KJ mentioned. And I guess, we just have to see if we can overcome those. Then finally, it's about the energy needs of this country. So, back to the blueprints that already exist. What exactly are the energy needs? And therefore, if we see it is clearly difficult to meet that need through existing renewable energy, which is mostly solar, then, it almost, by process of elimination, means you have to entertain this. China has 37 new nuclear power reactors within the last few years. So, China is among the countries that are fastest in developing their nuclear technology. So, I mean, the last thing, the last thing I want to touch on about nuclear is, I'm not saying that other technologies don't have

34:27 high benchmarks. But, once you have nuclear power and you need nuclear scientists to run this nuclear power, these jobs, you're really talking about cutting-edge jobs. And I'm sure there are many nuclear scientists that we train who now don't have opportunities because our nuclear ambition was curtailed. Okay, shall we move on? So, the next question I want to comment on is about currency. There are several questions regarding this topic. 'HRMN_RSD' What should the government do to make the ringgit perform the same as it did during the BN era? Quite a loaded question. Second, 'Vaticn',

35:12 V-A-T-I-C-N, What national policies can help the Malaysian ringgit strengthen against the US dollar in the near future? Third question, 'Mini Sunnard', Is there a plan to reduce Malaysia's dependency on the US dollar in international trade? So, regarding currency, regarding the ringgit situation. I guess, just briefly, what is the exchange rate? This exchange rate is the price of our currency compared to one other currency. When people demand a lot of our currency, there is a pull for the currency to rise. When we sell our ringgit to get another currency, there is pressure on that currency, the price of that currency, the exchange rate falls.

35:57 So, that's sort of the basic definition, right? But, what is implied in all these questions, what is in the questions I read is an assumption that when the ringgit is strong, then the economy is better. Which I think we need to problematize that assumption a little, because if you look at data, nominal exchange rate, in 1970, it was $1 to 3 Ringgit. Was the economy of 1970 better and more advanced than today? Of course not. So, those who were in the BN era will say, "Oh, BN was a better era." But in fact, since 1970, we have been in decline. Our currency, the ringgit, has been decreasing, decreasing, decreasing. And I think, what does this mean?

36:45 First, we ask, does it matter? Does it really matter? Our currency, this exchange rate, is important to whom, and who benefits, who loses? I think first, that era was probably the 70s, 80s. I don't know if you agree with this, KJ, but I think at that time, the idea was that we wanted to industrialize quickly. Maybe we needed a lot, there was a lot of import driven industrialization in that sense. So, a strong currency in that way was good. But when we have entered a different economic phase, like now and recently, where exports are very important in... the way we calculate GDP and the amount of our economic growth.

37:31 So, a more depreciated currency, a lower currency, has advantages in terms of exports. So that's one. The second point is to think about what actually led to what I mentioned earlier. Who is demanding our currency and who is selling our currency? One is about trade, like we described. But there are many other factors beyond our control that do not reflect whether the economic position is strong or not. For example, monetary policy. We are aware that if a central bank increases interest rates compared to interest rates of other currencies, then there is a flow there in terms of currency. Second is the issue of the United States' position as a reserve currency.

38:19 When the economic situation is not very good, not very strong, then many will flee to the USD to buy USD financial assets. Again, not to reflect Malaysia's economic position in any way. Thirdly, apart from monetary policy, apart from US reserve currency status, you also have to think about the tariffs imposed by certain countries, including now Donald Trump. When he imposes tariffs, the USD will rise. Again, it is not a reflection of our economic position, whether it is good or bad. So I guess, we have to understand what is driving our exchange rate and realize that if we really focus, it's not really fair to say a strong ringgit means a strong prime minister

39:05 or a strong ringgit means a strong economy. It's a bit more complicated than that, which we can chat about. I agree. However, the ringgit needs to be at a level that... if we use the central bank's term, it's fair value. If it is very weak, there will be problems. So, it's more about what we feel is a fair value for our ringgit. A fair value is not necessarily an overly strong ringgit, as Shahril said earlier. We are a trade-dependent nation. We have a trade-to-GDP ratio of probably 120%, 130%. This means that our dependence on trade is high,

39:52 and when we trade, we must trade in foreign currencies. And, as Shahril mentioned earlier, we are a country that always has a trade surplus. Every month, we have a trade surplus of RM12-15 billion. This means that we sell and export more than we import. So, if our ringgit is too strong, it will affect the competitiveness of our exports because our exports will become more expensive. But if the ringgit is too weak, Shahril, it will have an impact on exports as well because many of the things we import are what are known as intermediate goods. I hear, because of data centers now,

40:39 a lot of intermediate goods or imports are coming in. So, our current account surplus is already a little small. Correct. So, what I mean, just to clarify, is that these intermediate goods are the materials that we need to build, to make something for us to export. We buy, we import. So, if our ringgit is too weak, intermediate goods will be more expensive and ultimately our exports will be more expensive. So, it's related. So, just coming back to what you can, okay, yes, one. But what can you do? What should you do, and what can you do? What can you do? What should you do? Of course, one of the ways in which the value of the ringgit becomes stronger is when there is higher demand for the Malaysian ringgit.

41:27 And the higher demand in this international financial world is when more capital from abroad tries to come in to buy Malaysian assets. What assets? That's not trade, it's an asset. Assets. What kind of assets? Assets like shares, assets like existing physical assets, foreign direct investment, all of these can further strengthen the ringgit. But, they will only come here if they see that the returns in Malaysia are greater than the returns in other countries. This is basic. So, that's why if interest rates in the US were higher, much higher, they wouldn't come here. If the interest rate here is only 3%, and there it's 4-5%, of course, they will go there, easily.

42:15 But are we going to... just because we want a strong ringgit, we want to raise interest rates? When we raise interest rates, it is difficult for our people, for our businessmen, for our entrepreneurs because the cost of capital is increasing. So, there's no easy answer to this. However, what I suggest is what we do now. Positioning Malaysia as an attractive investment destination. Not necessarily in terms of the cost of the interest rate which is too high but a good place to do business. A place where we feel there is a natural hedge against the trade war between China and the US. Stuff that earns foreign currency like tourism.

43:01 If tourism is expanded further, our tourism market will strengthen the ringgit because people who come here will buy Malaysian ringgit. So, these are sensible things that in the long run will strengthen the ringgit. Okay, good. Okay, move on to... this is a question from our friend, 'Azif90'. Azif was with us at the center. He sends a lot of questions, but there is one interesting question. Can we discuss the merits of a political financing bill and what it would look like in Malaysia? On this KS, I can say that the ratio of language use in our podcasts is 80-20, 80% BM, the national language, 20% in English, but...

43:50 All questions in English? Everyone is speaking, right? Wow, our listeners, viewers. Maybe the language advocates aren't yet confident that we will answer their questions. So we hope that the next episode will be able to ask questions in the national language. So, okay Azif, interesting question. Indeed, in Malaysia, there is no law that regulates the funding of political parties. Or maybe it's a political funding campaign, political funding. In 2015, under Najib, at that time, the drafting of a political funding act was proposed to increase transparency in political funding in Malaysia.

44:39 And in August of that year, if I am not mistaken, a task force was established and had representatives from the government, academics, think tanks, and others. There are 32 recommendations, reports from the national consultative committee, regarding political financing. You can google it; I don't want to mention them one by one. But it does take best practices from foreign countries in terms of the amount allowed. When there is more than the specified threshold value, it has to be reported to a registrar for this political financing, what entity, and all political funding must be declared.

45:31 or must be declared. In the United States, Shahril, for example, must declare who gave him money, and for each candidate, there is a limit on the amount that can be taken from any individual or any entity. It's just that it has a loophole, what is known as a super PAC. So, this super PAC has no limits. So, he will set up a super PAC, a super PAC to support Shahril Hamdan or a super PAC to support DOGE, or a super PAC like Elon Musk's super PAC, that's unlimited. So, he also has a problem because even though he has a limit, each person can only give so much to a candidate, but that candidate can form a super PAC with his cronies.

46:18 a committee, and he can have as many as he wants. So in Malaysia, this doesn't exist at all. Absolutely not. So we don't need to declare. So I'm sure when Shahril was contesting the election, there were people who donated to Shahril, but no one knew, and Shahril didn't tell anyone. And in Malaysia, we think that it's high time that we had a campaign finance or political financing bill. Because we want to make sure that, first, there is transparency. Yes, there is transparency. And with this transparency, we feel, we are confident that it is transparent, yes. We can show you, this is a list of people who have helped me. And if later, later on, if that person wins and becomes a minister, and there is already a record that this person

47:06 or this company has given something to them, yes, so you can look out to see if there is any retaliation from the politician. But in Malaysia, there is none. And in Malaysia, maybe I was made aware of it a while ago, when Najib proposed this. There were several opposition parties, at that time they were the opposition, now they are the government party, that rejected, that rejected this act. Because they were the opposition at that time. They don't want to reveal who gave them the money. But maybe it's different now. He has no problem telling who gave him the money. Because maybe he felt at that time that he didn't want to inconvenience his funder. Because he also has a funder... I'm sure you know, Shahril. In Malaysia, people who give money to politicians

47:53 for political funding sometimes play both sides. This one he also gave, this one he also gave. So, they don't want to reveal that he gave to this person. To this person. There is one area, two candidates are competing against each other; he divides it in two. So, if we have transparency, then it's easy for us to know that this person is indeed hedging their bets, both sides. So, maybe start with some first principles, KJ. Part of it, KJ has explained, is about transparency and part of it, but first, the first principle that is important is to ensure that, as much as possible, financial resources do not become too big a factor in the victory, defeat, and outcome of a

48:40 political competition, whether in terms of individuals or parties or whatever. And I think in terms of principles and ideals, Malaysia's reality is very far from that ideal. Perhaps for those who are less knowledgeable about the reality of politics, here is an opportunity for me to spend a minute or two trying to spell out what I mean. If you are a politician at a not-so-big level, whether it's a leader of a division or branch in your area, you will be expected to resolve several matters related to not only your supporters but also the people. For example, if there's a leaky roof, if you're a young politician with high ambitions,

49:31 not even a representative of the people, but just somebody there... at the branch or at the division. You need to have cash to help. If you are an ambitious person, you have followers... not many, five, ten people, but you will have expectations to help in terms of the welfare of your followers. Because your followers, usually in local politics, are not those who are very wealthy. And there are also those who do not have a permanent job. That's the reality. So you need money. So that's the reality that I wish there was a central funding system that helps young politicians who are not yet influenced or 'small c' corrupted. By 'small c' corrupted, I don't mean

50:18 corruption that leads to crime, but when there are people, when we need to find money, then our integrity, we will be exposed to some extent, or there is a risk of being exposed. So that's the reality. Back to the question with the reality Shahril mentioned earlier. Because 'Azif' asked what it would look like in Malaysia. So what Shahril meant earlier is that this is not just a political financing bill for elections. If that person is not a representative of the people but a politician, a member of a political party, a youth branch leader, for example, or a branch AMK leader, whatever. What do you call it? 'Ranting'? 'Ranting' is a branch. 'Ranting'? Twig.

51:03 Oh wow. I see. I see. No meaning behind my knowledge. Just my general knowledge. The PKR elections are coming up soon. He already knows that it's a branch, not a division. So, for example. So, let's say he's the AMK branch leader or the division youth leader. He accepted donations. So, he has to register. So, that's what you're saying? Correct. Either that or a central budget that comes from his party. That's a potential idea. But the party has to register. The party has to be registered. UMNO has to say, "Okay, we have 20 million in donations from friends, from members, from corporations, and so on." Which in reality happens too. Because if you are a division leader, a division youth leader,

51:49 where do you get the most, where do you look for allocations? The President of your party. That's right. Or your state liaison chairman. So, it's happening now. But there's no transparency there either. I mean, like KJ said, not just election candidates but throughout the political season. That's one. Two, I also think, like KJ gave the example of the United States Super PAC, I also agree that a better principle is like in the United Kingdom, where there is no permission for Super PACs, right? So, everyone has a limit. There must be a limit. Otherwise, even if you are transparent in telling who gave, if there is one person or one company who gives a very, very outsized amount compared to others, if you win and have influence in the government one day, there will be expectations. Whether mentioned or not.

52:35 If it is said, then it is corruption. Not to mention, there is a risk of 'small c' corruption. So, what it would look like in Malaysia is setting a low ceiling, the amount that can be taken. So, for example, what would that be? Shahril has contested elections twice, what would that be? A parliamentary candidate in Malaysia, what would that be? So, before I answer that question, I also think the RM200,000 cap should be increased? No, I think, no. Now, for the information of listeners and viewers, the limit that can be spent is RM200,000, which is quite unrealistic, quite unrealistic. But Shahril, if we set the amount of donations allowed for parliamentary candidates,

53:23 then there is no need for a limit. Then you just spend whatever you want. Correct. So, let's say a parliamentary candidate, Shahril becomes a parliamentary candidate, the limit for each parliamentary candidate to receive donations is RM1,000,000. Then it's up to you, do you want to spend RM1,000,000 or not? Oh right, but the original question is, that person cannot give RM1,000,000. Your RM1,000,000 cannot come from one person. Oh no, okay. Let's say a person can only give RM20,000, but you are so popular that you get up to RM20,000, you get a large amount, RM1,000,000. And, if there are many supporters who give RM10, RM50, and there is a transparent process, I think that is a positive reform. And the last point is. But just on that, Shahril, I just want to add. I also like it if the person who donates

54:11 knows how much the candidate has spent. Okay, so not just inflow, outflow too? This is outflow transparency, because we know that many in politics, they get X, they spend Y. X is bigger than Y. They keep the delta. That's why everyone wants to be a candidate, it doesn't matter if they win or lose. Yes, there is transparency in terms of outflow. In terms of practicality, I guess what can you hide. Not hide to hide anything but in terms of strategy, right? Without being too specific, there are also ways to justify not keeping it. I am not taking this money for my own personal expenses. I think that's the point, that's what we want to happen. And that thing has been declared. That means, I received RM100,000, I declared RM100,000.

54:58 I didn't receive RM100,000, I declared RM10,000. The remaining RM90,000. The last point is in terms of culture. Which is, there cannot be a culture of revenge. This means that if it is clear that someone gave to an opposition candidate, for example, the government cannot punish that person. But there should be an expectation, there should be a legal framework. How legal? I mean, you know. There should be a... For example, because Azril asked for a real scenario. Shahril versus Bobby, okay. KJ gave it to Shahril. Bobby won. Bobby won. Bobby became a minister. KJ entered the tender in Bobby's ministry. Bobby takes revenge on KJ.

55:47 So, Bobby said, no, you don't have the technical capabilities. Of course, I understand. I guess, the revenge I mean shouldn't be more than that. Even that is wrong. Even that is wrong, KJ. Even that is wrong. And if there was a mechanism for a third-party arbitrator, to complain about this and basically say, "I know, I know this is difficult, but this is the ideal." It's the ideal. You need to have that. You need to have an ideal where there is no punishment and no reward. Okay, great. Maybe last one from you, last one from me. There is another audio question that was sent. Regarding the subsidy issue, if I'm not mistaken.

56:34 Maybe we can listen to the audio note. Greetings, KJ and Shahril. Zahira from Pahang. I'd like to know, could KJ and Shahril share their views on identifying the targets? and implementation methods for subsidy targeting, for example, petrol, if both of you were in a position to implement such a policy? That's my question, but I would like to share my point of view. I understand that PADU tried to get a head start on this, but may I say it fell a bit short. Why not utilize data from the Inland Revenue Board (LHDN) for status verification? There's already a tax bracket classification. Why not use the same methodology?

57:22 Provide a subsidy rebate bracket equivalent to that tax bracket. At least that would cover data for the majority of taxpayers, namely the M40 and T20 groups. And for the B40, maybe we could use data from STR. Then, using the rule of elimination, at least the ones that are left can be identified, like the ultra T20, foreigners, students, senior citizens, or pensioners. And then we can further use other criteria to identify them. And then, when there is this sort of subsidy rebate bracket based on this identification, people like us, the M40, are at least incentivized to declare ourselves.

58:13 And then for the execution, maybe once they identify the M40, T20, and others, they can assign subsidy rebates according to their status. It could be a percentage subsidy or a quota given to each person per week or per month. Just have one price at all petrol stations. When fueling up, maybe the rebate can be returned to an e-wallet, and once the quota is finished for that given duration, they'll have to pay the full amount until the next reset. That's my opinion. Okay, thank you. Question from 'Ira Nurizan'. Basically, in implementing targeted subsidies, such as for RON95, why not use LHDN data as opposed to... why do you have to create PADU data and so on? In short, my understanding, KJ, of why PADU is even something we talk about

59:02 is that, it is correct, in terms of logic, in terms of instinct, LHDN already has data, DOSM already has data. But I think the simple fact is there's so much noise in this data. This noise in the data, for example at LHDN, okay, PMX and everyone now says T15. This means that 15% will not get the subsidy, and 85% will. We are still waiting to see what the definition of that 85% is. What is the definition of that 15%? But I realize that if 'Ira' gives a suggestion, "Why not use the IRB?" I guess the first thing to say is the IRB itself, if the IRB wants to think about income tax, only 14-15%, if I'm not mistaken, of Malaysian workers pay income tax. Others, theoretically, have salaries that are not enough to pay income tax.

59:52 If you use that basic logic, it means that 15% pay. If you pay income tax, it means you don't get it; you don't get any subsidies. But that in itself feels wrong because the salary to pay taxes now, is more than RM3,000 a month; you have to pay the IRB, you have to pay the PCB. It's not like if we earn more than RM3,000 a month and don't get the RON95 petrol subsidy, I don't think the government even considers that as super rich or as T15. So you already see the noise in the data and the incompleteness, inconsistency in the data. DOSM has set the upper threshold for M40 at RM12,000 per month, per household. So you are T20 if your household income is more than RM12,000 per month.

1:00:37 So you compare RM12,000 for T20 and LHDN, RM3,000 a month, you have already paid (income tax). So you see the incongruence of the data. Perhaps that is where the need for a centralized data system, a data repository that can be obtained from various sources, comes in. So I think in that context, we support efforts like PADU. Basically, you get the data from different places, use the process of elimination through the Rahmah Cash Donation (STR). If you get STR, it's confirmed that you get a subsidy. The delta is where you need to get from different places, right? So I guess we are supportive. The basis of 'Ira''s question is probably, this is where we want to give suggestions or constructive criticism to PADU.

1:01:25 The problem is it's not clear what the formula is. It's not clear when we say that we want to use disposable income, what is disposable income? It's not clear if you are going to use different geographies, different locations, what the location's boundaries are. And time is running out for the government because they said they wanted to implement this in the middle of the year, say June, July. We are almost halfway through February. Then fasting, Eid. The process of explaining this will take a long time, Shahril. Why this? Why that? Why take data related to geography? Why collect data related to existing dependents? Why just have 3 dependents like this? What if 4 dependents get subsidies, but 3 don't get them for this kind of income?

1:02:16 And is it fair that because you have more or fewer dependents then you are in and out, right? Right, right. So... So that's why, again, comms and clarity because you have to come out. Clarity; clarity of the conditions is the most important. So clarity of thought, meaning they have a clear government thought, why this and why that. Of course, the threshold value will be arbitrary; why 3, not 4, you know, for instance. But they have to explain why we think that. So 'Ira''s original question is what we would do if we were in charge. So what's wrong with KISS? Keep it short and simple, which is just LHDN income.

1:03:04 But like we said, LHDN income is problematic. Okay, combine that, combine that with something from DOSM. But that's it, that's it. Nothing more than that. No geography, no urban, no car size, no family size, all that. I guess, yeah, I'm not against that. Keep it simple. Make it simple to start with. Yeah, because nobody is questioning B40. So everybody accepts B40 or B60 now because there are many STR recipients, more than 40%, so you only have to account for the other 20-25%. So that's where you use DOSM, LHDN, and that's it. I suppose if you really want to, use the e-invoice data or whatever, just to double-check and all that.

1:03:50 I like the thinking behind PADU, you know, so it's more granular. But I'm worried we're not ready for it. So when we want to do something big like the RON95 subsidy adjustment, I think KISS: keep it short and simple. To start off, to start off, to start off. Okay. Yeah, okay. The last one from me, from 'PinkCactus99', "What do you think of the government having its own satellite?" "Is MOSTI, MYSA ready? Are we ready?" Before that, the Malaysian Space Agency, MYSA. I was told, I was told somebody went to the Malaysian Space Agency recently.

1:04:38 Yeah, you forget that I have eyes and ears. Still, you still have them in government. All government corridors. I admit I went to MYSA for a meeting. For business, not just for 'going out for a moment'. I even have the picture. Oh, do you? Okay, nice, nice. I haven't got the picture. I have the picture. Okay, so for 'PinkCactus'' information, the government has had its own satellite before. Once upon a time, we had a company called ATSB, Astronautic Technologies Sdn Bhd. A company wholly owned by MOF Inc. But operationally, it falls under MOSTI. And this ATSB, which was founded in 1995,

1:05:28 was responsible for launching, Malaysia's first satellites, starting in 2000. Our first satellite was TiungSAT. A microsatellite that was launched from Kazakhstan, if I'm not mistaken. In 2009, ATSB launched RazakSAT. RazakSAT is our second microsatellite. But unfortunately, RazakSAT was built in 2009 and decommissioned in 2010. It didn't work as intended.

1:06:16 Decommissioned. But still, I guess it's just out there somewhere. So unfortunately, this RazakSAT story, launched in 2009, decommissioned in 2010. Because it didn't provide what was needed in terms of imaging capabilities. Since the failure of RazakSAT, the Malaysian Space Agency under MOSTI, we have been dependent on contracts. So we buy from foreign satellite companies for remote sensing or for our data satellites. So all the satellite data we get at MYSA, at Bukit Tunku or at Temerloh.

1:07:03 It all comes from contracts we have with foreign satellite companies. This is a problem. This is a problem. So, when I was at MOSTI, I felt that this was a problem. because we don't have satellite or remote sensing sovereignty. And this is important for things like border security and so on. We depend on the images given by foreign companies. And unfortunately, we don't have the capability to succeed so far. So, I thought about it, and I wanted a mission to have our own capability. But I know from our past experience that perhaps a government entity is not the best entity

1:07:51 to carry out this task. That's why I challenged any private entity, if they could take over and carry out this task. And I was very happy when I saw recently a satellite that had been launched by the company Uzma Berhad. You interviewed the brother. Yes, the other Kamarul. The other Kamarul, the elder brother. Earth Observation Satellite, a very high-resolution Earth Observation Satellite. The first commercial one in Malaysia was launched on January 15th from the United States by the company Uzma.

1:08:43 And this satellite has a very, very high resolution, 50 cm, and this is part of a constellation of satellites. It is part of a chain of over 25 satellites managed by Satellogic. So UzmaSAT-1. So I guess that's your answer, 'PinkCactus', that I think this is the best way. The government should not be involved in things like this, but we support efforts like UzmaSAT-1, which is operated by a private company.

1:09:28 I just wanted to share also the use cases of the satellite. This satellite is not just for border security. That's why we need to understand the application of Earth Observation Satellites. For agriculture, to detect, for example, plant health, to increase agricultural productivity so you can tell which soil is more productive or fertile. In terms of urban planning, infrastructure mapping, natural resource management such as forests and water, forest monitoring, illegal logging and so on, disaster and environmental management, and much more. So the use cases are numerous, and I hope that with the existence of

1:10:17 UzmaSAT, more people, or even Uzma itself and perhaps other private entities, will also be involved in efforts to ensure that we have Earth Observation, Remote Sensing, Satellite, and Geospatial Sovereignty of our own. Yes, I just want to add, firstly, one of the companies that, the investment firm that I am involved with, is a company that can track all the satellites in low Earth orbit. In fact, that was basically the purpose of my visit to MYSA, KJ. And another area of expertise that, if not available in Malaysian government agencies, can, with the cooperation of the private sector, help achieve the goals that KJ mentioned.

1:11:05 And KJ didn't mention earlier, we have a National Space Policy which I think was launched before 2018. And with the National Space Policy, which has five core pillars that I am currently reading, among others, to focus on technology, infrastructure, and space applications for the country, contributing to the economy, and increasing international cooperation and networking. So there is also, we mentioned earlier about the issue of the jobs of the new millennium and the new era, this is one of those other things where it's a different kind of skill set that, God willing, Malaysians can have. So I recommend to those who are interested in this national space policy, there is a National Space Policy you can read, and also the National Space Policy Action Plan.

1:11:54 And there are many startup companies, KJ, some of whose founders I have met, that are in this space area, you know. I've met some 20-something-year-olds who came from local universities who have ideas and also have business ideas that already exist. Some already have revenue in that place within this space. As usual, Shahril, we Malaysians are sometimes ahead of our time. We were at the forefront of a change that happened a long time ago. When we sent Dr. Sheikh Muzaffar to space, to the International Space Station. ISS, International Space Station. Because of that, actually, during the time of the late Tan Sri JJ, he was my predecessor, there are

1:12:41 definitely many things to do. For example, there is a facility built at MYSA Banting. That is, a facility for assembly, integration, and testing. I went when I was a minister. It was this huge facility where you could test satellites as big as one ton, 1000 kg satellites. State-of-the-art. But then, it was built and fully operational in 2014. But when I asked, how many satellites have you assembled or tested there? Not many. Zero, not many.

1:13:27 So, again, sometimes when we had that aspiration, the follow-through was quite poor. But I hope now, with the many investments made by Uzma and the companies I mentioned earlier, this is an exciting area. The richest man in the world has spent a lot of money on this. That's the next frontier. So, most of the satellites are his, right? All these new satellites are Elon Musk's. They belong to him. And one of them, maybe a plug, is for my work at MOSTI. One of the things I did when I was at MOSTI, to leave things to make this industry easier, was to bring in the Malaysian Space Authority bill. I actually passed a bill. Now, it's a law, an act of parliament that ensures that space activities are safe.

1:14:17 And then, of course, the regulations for launches and things like that. We managed to do that. Okay. Alright, are we good for this episode? Please give comments, feedback, is this format okay? Do you want a longer or shorter answer? We will try again for the next session. Thank you.