It’s all about investing in technology!

When you ask the critics of crypto currencies on their opinion of these digital monies – the most famous being bitcoin – you’ll find that they are still mired on the issues of their safety and lack of intrinsic value as a secure system of payment and as an investment instrument.

In all likelihood, these critics – which include professors of economics and economic analysts – will invoke the famous greater fool theory, which asserts that the price of an object is determined not by its intrinsic value, but rather by irrational beliefs and expectations of market participants.

Simply put, they think a rational buyer can justify the price of these cryptos under the belief that another party is willing to pay an even higher price.

These had been my experience when discussing about bitcoin with academics and economists, with the die-hard gold enthusiasts among them insisting that there will be injustices in any system of currency that is not backed by gold.

But gold in itself has no intrinsic value. It’s just a piece of shiny metal. Its value is derived from everyone just agreeing it has value, and therefore it becomes valuable.

Be that as it may, gold has certain characteristics that make it a better ‘store of value’ though its role as a medium of exchange had long gone after what President Nixon had done to the Bretton Woods financial order in 1972 – cutting off the convertibility of the dollar with gold.

Turns out, the characteristics that have made gold a better store of value and medium of exchange – scarcity, malleability, stability, doesn’t degrade, easy to recognize and very importantly, hard to counterfeit – are also applicable to bitcoins.

While gold is limited by geography, bitcoin is limited by an algorithm to 21 millions. It can be made into smaller units without losing unit value (1 bitcoin = 100,000,000 satoshis – the smallest unit into which a bitcoin can be broken down, which is also why one can buy less than one bitcoin at a time). The underlying technology behind its creation – distributed blockchain ledger also known as the Bitcoin Protocol – is very stable with no hacking, counterfeiting and manipulation to date.

To top it all, unlike gold, you can move bitcoins to any place on earth within minutes, no matter how big or small the amount and that’s why many people say that bitcoin is not just digital gold, but a better version of gold.

And technology has already empowered a crypto currency, ether, with scalability – the ability for you to move it to any part of the world within seconds instead of minutes via its ethereum blockchain technology (so ethereal!).

A 2015 report by the UK Government Chief Scientific Adviser on Distributed Ledger Technology: beyond block chain has asserted that “algorithms that enable the creation of distributed ledgers are powerful, disruptive innovations that could transform the delivery of public and private services and enhance productivity through a wide range of applications.

“In distributed ledger technology (DLT), we may be witnessing one of those potential explosions of creative potential that catalyse exceptional levels of innovation. The technology could prove to have the capacity to deliver a new kind of trust to a wide range of services.

“As we have seen open data revolutionise the citizen’s relationship with the state, so may the visibility in these technologies reform our financial markets, supply chains, consumer and business-to-business services, and publicly-held register,” adds the report.

Where lie the injustices?

Now, let us address the gold purists’ argument that there will be injustices in any system of currency that is not backed by gold.

In 2013, bitcoin made headlines as it went from USD13 to USD1,157 (an 8,800% gain). Its meteoric rise was fueled by the economic crisis in Cyprus where its banking system had been battered by bad loans.

In order to save the banks, the government confiscated as much as 47% of people’s wealth via so-called “bail-ins.” As a result, people scurried to move their money outside traditional currencies and bitcoin soared.

In 2016, when Indian Prime Minister Narendra Modi banned 86% of all Indian paper money overnight, Indians turned to bitcoin.

Meanwhile, as the bolívar crumbled in 2016 as a result of the Venezuelan government deflating its currency and removed half of all paper money from circulation, Venezuelans turned to bitcoin.

When China tightened its stranglehold on capital outflows in the latter half of 2016, it caused a surge of bitcoin buying. It helped send bitcoin soaring as much as 91% at the end of the year.

All the above events, which can be summed up as Currency Crises and the War on Cash, obviously have resulted in some injustices. And crypto currency like bitcoin had mitigated some of these injustices.

So let’s ask the gold purists again: “Where lie the injustices of a currency, albeit a crypto currency, that is not backed by gold which in turn does not have an intrinsic value like gold?” They have been surely fed with the myth of the intrinsic value of gold.

When it comes to the crunch, as the above disparate events in history had shown, people no longer seek safe haven in gold but bitcoin.

The article below will demystify the accelerated increase in the prices of some crypto currencies by arguing that it is technology that has made these cryptos valuable despite lacking intrinsic value.

This is better than gold, which is not backed by technology but by a derived value of people just agreeing that it is valuable, and presto it becomes valuable.

Distributed Ledger Technology (DLT)

One technology that is now like the new kid on the “blockchain”, DLT (Distributed Ledger Technology) will become mainstream within the next few years, as predicted by many experts.

According to a 2016 report by the World Economic Forum on The future of financial infrastructure: An ambitious look at how blockchain can reshape financial services:

  • More than 24 countries are currently investing in blockchain
  • More than 2,500 patents filed over the last 3 years
  • More than 90 corporations have joined blockchain consortia
  • 80% of banks predicted to initiate DLT projects by 2017
  • Venture capital has invested over 4 billion in blockchain technology over the past 3 years
  • More than 90 central banks have engaged in DLT discussions worldwide

Singapore’s central
bank and financial regulatory authority (MAS) is embarking on a project to evaluate the implications of a tokenized Singapore dollar (SGD) on an ethereum-based blockchain distributed ledger with potential benefits to its financial ecosystem.

The objective is to develop a peer-to-peer payment system prototype using DLT in which
bank users can exchange currency with one another without lengthy processing times, expensive processing fees, or intermediaries.

If completed successfully and later implemented, Project Ubin, as it is known, will signify the republic would be the first major financial centre in Asia to fully explore the benefits of DLT across a broad set of transformative applications.

Since Malaysia is the only country in the world espousing the establishment of a free digital trade zone – the brainchild of premier Najib Razak – a synergy in cooperation and collaboration with Singapore on the creation of a global peer-to-peer payment system that would eliminate a trusted third party would be a novel thing to do.

With a trusted third party gone, you would also eliminate all the past and present scandals and crooks in the financial system masquerading or embedding themselves, as part of the trusted third party!



It’s all about investing in technology!

By Jamari Mohtar

Across the Straits

Focus Malaysia | Sept 2, 2017


While one would expect the custodians of fiat money, that is, banks and central banks in particular, to oppose the existence of crypto currencies – the most famous being bitcoins – the irony is they are actually seeing opportunities in these cryptos especially in the underlying distributed blockchain ledger technology behind their creation.

The Monetary Authority of Singapore (MAS), the republic’s central
bank and financial regulatory authority, is embarking on a project to evaluate the implications of a tokenized Singapore dollar (SGD) on an ethereum-based blockchain distributed ledger with potential benefits to its financial ecosystem.

The objective is to develop a peer-to-peer payment system prototype using distributed ledger technology (DLT) in which
bank users can exchange currency with one another without lengthy processing times, expensive processing fees, or intermediaries.

Three innovations that had begun with the creation of bitcoin have paved the way for DLT to emerge:

  • Peer-to-peer networks: In this model, every peer in the network is a server and client, both supplying and consuming resources. This may facilitate, for example, the creation of a currency without a privileged trusted third party, amongst other types of decentralised financial interactions.
  • Public key cryptography: This is a method for verifying digital identity with a high degree of confidence, enabled by the use of private and public keys. Cryptography enables the individual identification and exchange of bitcoin among users.
  • Consensus algorithms: This ensures agreement between parties on a network can help validate the data’s authenticity as well as transactions and control when it can be written into the system. This prevents double spending by ensuring chronological recording of data.

In June, MAS issued a report, The Future is Here, in which it announced Project Ubin: SGD on Distributed Ledger that was started on Nov 26. Its goal is to 
reduce risk and costs for cross-border settlements of payments and securities. Cross-border operations require international cooperation on standards, the ability to identify payers and payees, and systems of adequate scale.

Project Ubin is implemented in phases, starting with a DLT for domestic payments in phase 1. Subsequent phases will explore cross-border payments in a single currency, settling different currencies and culminate with risk free cross currency securities settlements.


This concept of an SGD-on-ledger is to distinguish it from existing forms of digital central bank money such as the deposits that banks hold at the MAS, which are used to make payments via MEPS+.

MEPS+ or MAS Electronic Payment System is a Real-Time Gross Settlement (RTGS) system that supports large-value local currency interbank funds transfers and the settlement of script less Singapore Government Securities (SGS) between MEPS+ participants, subject to the availability of funds and securities.

In essence, the SGD-on-ledger can be seen as a specific use coupon that is issued on a one-to-one basis in exchange for money. The coupons have a specific usage domain – the settlement of interbank debts – but no value outside of this. One is able to cash out by exchanging the coupons back into money later.

One may think of these as the coupon booklets at fun fairs: visitors can purchase them to be spent on games and food within the fairgrounds only.

SGD-on-ledger has three useful properties:

  • Unlike money in bank accounts, there is no interest on the on-ledger holdings because of the speed of the transaction. The absence of interest calculations reduces the complexity of managing the payment system.
  • To ensure full-redeem ability of the SGD-on-ledger for money, each token is fully backed by an equivalent amount of SGD held in custody. This means that the overall money supply is unaffected by the issuance of the on-ledger equivalents since there is no net increase in dollar claims on the central bank.
  • SGD-on-ledger is limited use instruments and can be designed with additional features to support the use case – such as security features against misuse.

While Phase 1, which includes developing proof-of-concept
to conduct inter-bank payments through DLT had been completed with flying colour, the other phases are still on going.

Moving forward

If completed successfully and later implemented, it will signify the republic would be the first major financial centre in Asia to fully explore the benefits of DLT across a broad set of transformative applications.

So what does all this mean when you see the frenzied transactions in crypto currency trading?

It means you are buying into future technology with varied applications. The ethereum blockchain, somewhat similar to the Bitcoin Protocol is the technology used to create the crypto currency, ether.

And because it has scalability – the speed to process transaction in seconds instead of minutes – the price of ether has risen faster than bitcoin, prompting experts to describe it as the new bitcoin.

But critics of crypto currency, including professors in economics in their rigid thinking, have no other words to describe this rapid increase in price other than painting a doomsday scenario of a bubble in the making, despite the many bubbles that bitcoin has undergone since 2013. They should instead embark on a rethinking of the phenomenon of bubbles in economics, just like the practitioners of economics – the MAS bankers – have exhibited in their rethinking of crypto currencies.

It will do them a lot of good to pay heed to a 2015 report by the UK Government chief scientific adviser on DLT: beyond block chain which asserts that “algorithms that enable the creation of distributed ledgers are powerful, disruptive innovations that could transform the delivery of public and private services and enhance productivity through a wide range of applications … The technology could prove to have the capacity to deliver a new kind of trust to a wide range of services.”

In essence, this would mean doing away with the present arrangement of a trusted third-party intermediary to cut meaningful cost and enhance speed in a trustless peer-to-peer system that can be trusted. If this is confusing, it just means you can have a transaction with anyone in the world, even someone you don’t trust, but you can be assured of the trusted nature of the transaction.

Since Malaysia is setting up a free digital trade zone, – a synergy in cooperation and collaboration with Singapore on the creation of a global peer-to-peer payment system that would eliminate a trusted third party would be a novel thing to do.

With a trusted third party gone, you would also eliminate all the past and present scandals and crooks in the financial system masquerading or embedding themselves, as part of the trusted third party!

Jamari Mohtar is a veteran journalist who used to live and work in Singapore. Comments:


Staying ahead via “unmanned” sector

According to a Hadith of Prophet Muhammad (peace be upon him), “wisdom (knowledge) is the lost property of the believer; so let him claim it wherever he finds it.” (Tarmizi).

This injunction of the Prophet (pbuh) had energized the early Muslims in their quest for knowledge to travel to all corners of the world, acquiring wisdom and learning from others in all humility, and assimilating them into their own body of knowledge through the process reflection, deflection and digestion (what we would now call value-add) and soon thereafter, became the masters of knowledge and wisdom in a thriving and successful civilization.

Now fast-forward to the modern time and you’ll see the majority of Muslim countries have ignored this injunction at their own peril, and thus many remain backward and under-developed.

On the other hand, it is the non-Muslim countries that are generally acting like a believer by claiming wisdom and knowledge as their lost property wherever they find it.

One such country:  small and secular Singapore, which has no natural resources and whose spectacular success can be encapsulated in the following words:

Singapore is not and will never be ashamed to learn from anyone – be it the developed West, developing countries, backward Africa and even neighbouring Malaysia and Indonesia.

However, come implementation time, the city-state will never implement 100% what it has learnt from them. It will creatively adjust and modify what it has learnt to the Singapore context, and soon this borrowed idea which has been adjusted and modified to suit the local context becomes a uniquely Singaporean invention, which others are bound to imitate.

The unmanned cafe in Singapore – the subject of this article – is one such example, which I supposed was borrowed from the Japanese but without the robots!

Read on…


Screen Shot 2017-09-02 at 3.19.49 AM

Staying ahead via “unmanned” sector

 By Jamari Mohtar

Across the Straits

Focus Malaysia | August 19, 2017


ON my recent trip to Singapore, everyone I met with spoke of a café where you can partake delicious food without any chef or waiter to tend to your culinary needs.

My curiosity “bud”, just like my taste buds, went on overdrive, wondering what in heaven’s name were these Singaporeans talking about.

Much later did I realise that this talk-of-the-town stuff is not so much about eating but rather a big bread-and-butter issue that will have a long-term repercussion on the Singapore economy.

It is about the city-state coming out with a brilliant solution to an economic challenge that could impede the sustainability of its long-term growth. That solution involves creating an “unmanned” sector in its economy as a new engine of growth.

You won’t find this novel concept of unmanned sector in any standard textbook on economics. Nor would you find it in any country’s official economic report including Singapore’s. But the concept was often mentioned in recent speeches of its leaders such as during this year’s May Day Rally.

This concept of an unmanned sector in the economy arises out of the need to manage the twin challenge of a shrinking population growth and the import of foreign workers and talents.

The same challenge of a shrinking population growth is also faced by Japan, but the Japanese solves this problem with robots.

Everything in Japan now is about robot – from a hotel entirely manned by robots to a robotic domestic worker to assist in household chores, right to ahem, a robot that you can be “married” to because it can act and function like a spouse!

There is a good reason why Singapore is using robots sparingly though it is going big on robotics. This has to do with the secret recipe of the city-state’s success since the time of its founding prime minister Lee Kuan Yew.

And this success can be encapsulated in the following words:

Singapore is not and will never be ashamed to learn from anyone – be it the developed West, developing countries, backward Africa and even neighbouring Malaysia and Indonesia.

However, come implementation time, the city-state will never implement 100% what it has learnt from them. It will creatively adjust and modify what it has learnt to the Singapore context, and this new thing soon becomes a uniquely Singaporean invention, which others are bound to imitate.

The unmanned cafe in Singapore is one such example, which I supposed was borrowed from the Japanese but without the robots!

Dubbed as VendCafe, it is a pilot project launched by the republic’s Deputy Prime Minister Tharman Shanmugaratnam in August last year. A food and beverage (F&B) company, JR Vending is the operator of the unmanned café, with government agencies Spring Singapore and the Housing Development Board (HDB) jointly facilitating the project.

Located at the void deck of a HDB block in Sengkang, the VendCafe serves a variety of hot meals, snacks and beverages in bento-style containers from an array of six vending machines. These meals cost between S$3.50 and S$5.

Tharman, who is also the Coordinating Minister for Economic and Social Policies, alluded to the manpower shortage in the F&B sector as the driving force behind the project.

“The F&B sector takes up almost 5% of our total workforce, and it’s still growing as a sector, but we can’t keep growing manpower, in particular foreign manpower. So we have to find ways of using technology without compromising consumers’ desire for taste, health, nutrition and convenience,” he was reported as saying.

The so-called Chef-In-Box machines dispense hot meals in under three minutes, offering Western and local dishes by using a technology that freezes the pre-cooked food and begins to heat it up when cash or cashless payment starts to roll in. The food has no preservatives or additives. There are a lot of behind the scene stages before the food is brought into the machine to ensure that tasty, healthy and nutritious food are served.

A second Chef-in-Box VendCafe was opened on June 13 at the Ang Mo Kio MRT Station – a first at an MRT station, which represents a new emphasis on crowded places and away from places that lack amenities like the first café in Sengkang. On June 22, a second VendCafe at an MRT station was opened at Lakeside – double the size of the first at Ang Mo Kio.

In a May Day Rally this year, Prime Minister Lee Hsien Loong mentioned other elements of an unmanned sector. These are:

  • Automated storage and caddy pick system at the new distribution centre of Singapore’s premier supermarket, NTUC FairPrice, where robots carry the pallets and deliver them to the bay. The pallets are then wrapped up automatically before going out of the warehouse.
  • Automated guided vehicles (AGVs) are being tested at the port terminals at Pasir Panjang. These AGVs move around in the container yard by themselves with no driver’s cabin and driver to collect containers. The crane picks up the container from the ship, lowers it carefully onto the AGV and off it goes. By the time the mega port in Tuas is built in 2021 where everything is consolidated there, the turnaround time will be even faster and more efficient with better versions of AGVs.
  • Unmanned checkout systems where nearly half of the outlets operated by the three major local supermarket chains have already introduced. These allow shoppers to complete the checkout procedure on their own, from scanning items to paying by credit card.

And on July 19, Defence Minister Ng Eng Hen has offered the Philippines the use of unmanned aerial vehicles (UAVs), otherwise known as drones “to enhance the intelligence, surveillance and reconnaissance capabilities” of the Philippine troops to dislodge Muslim militants still holding up in the southern city of Marawi after nearly three months of fighting.

But drone is not limited to the defence sector. Last October, a SingPost drone was used to deliver mail to Pulau Ubin. Meanwhile local dining establishment Timbre announced plans to deploy waiter drone at its restaurants.

All these efforts have contributed to a productivity growth of 1% last year compared to almost zero in the previous three years. This means the government’s strategy of growing the economy sustainably through better productivity growth rather than manpower growth is on track to succeed.


Jamari Mohtar is a veteran journalist who used to live and work in Singapore. Comments:


New dawn: The rise of PAS with a strategic mission

By Jamari Mohtar

May 19, 2017

IS former premier Tun Mahathir Mohamed who’s also the archrival of Prime Minister Datuk Seri Najib Razak, admitting defeat? If so, then this will be a strong signal that General Election 14 (GE 14) is so imminent because it would mean the already bright and rosy situation for Najib now is going to be brighter and rosier still, which could tilt the result of GE 14 in his favour in a big way.

In a recent news report based on what he has written on his blog, Mahathir said: “Whether or not PAS would work with Umno in GE 14, the Islamist party’s participation in the polls would reduce support for Pakatan Harapan (PH) and PAS itself. PH and PAS will lose and Barisan Nasional (BN) will win. This is PAS’ true struggle. It’s not for race and religion; it’s aimed at weakening the Malays.”

However, when I showed this news report to a group of friends who have openly espoused to me their support for the Islamist Pan-Malaysia Party (PAS) – though I cannot vouch whether they are card-carrying members – they were not as sanguine as my tentative conclusion was.

“The grand old man of Malaysian politics is so wily and cunning after breathing, sleeping, dreaming and scheming with Power for 22 years that you must take what he said with a pinch of salt; no, not a pinch but many pinches of salt.

“That seems to be his strategy: trying to indoctrinate the Malays that PAS is the troublemaker for splitting the Malays when he was the one who had split the Malays while still in power, and continues to split the Malays even when it is time for him to prepare for the meeting with his Maker,” said the most vocal among this group of friends.

The others started to chime in immediately before I could even make my point that the comment was indeed very harsh on someone who has done a lot for the country.

Among other things, they were asking me what Malays are Mahathir referring to because if it is the United Malays National Organization (Umno) Malays, the Democratic Action Party (DAP) Malays, the People’s Justice Party (PKR) Malays, the National Trust Islamic Party (PAN) Malays or the Malaysian United Indigenous Party (PPBM) Malays – all but Umno being the component parties of opposition coalition PH – then PAS is not interested in these Malays.

These devoted supporters of PAS are focused on PAS’ strategy to attract Malays who sincerely believe in the relevance of Islam in providing solutions to the multi-faceted problems of modern living, and also Malaysians of all races and religions who would want to listen and understand the universal message of Islam without prejudice.

There seems to be some forceful logic in this argument of PAS supporters simply because PAS is an Islamist party with Islam being seen as sacrosanct and a foundation for its existence and survival, while Mahathir being the chairman of a Malay party sounds like a sore loser who could already see defeat before even the battle (i.e. GE 14) had begun.

From the perspective of PAS followers and supporters, the inherent contradiction in Mahathir’s argument can be clearly seen in the context of his refusal to lend support to PAS in its pet Islamic project of amending the Syariah Courts (Criminal Jurisdiction) Act 1965 or RUU 355, and yet at the same time yearning for PAS to be a bedfellow in PH.

Shouldn’t that decision of being a fellow member of PH be up to PAS that should be respected by all, they asked? If in the unthinkable event that PAS chooses Umno/BN to be its bedfellow, there is nothing earth-shattering about this, for PAS had already done the unthinkable before by being a bedfellow of DAP in the past, much in the same manner that Mahathir is also doing the unthinkable by being a bedfellow of DAP now.

After all, Umno has helped PAS in making it possible for its president, Datuk Sri Abdul Hadi Awang to table the RUU 355 in Parliament. Moreover, Umno has also proven its worth when it comes to doing something for Islam as opposed to a brand new party that has nothing to offer yet at the moment, like PPBM in which Mahathir is the chairman.

Herein lies the talk about an emerging new PAS that is very refreshing, and takes very seriously the question of tactics and strategies instead of focusing merely on ideal or ideology in a rhetorical manner much like delivering a kuliah subuh (religious talk held after the fajr prayer in a mosque), as in the past.

That also seems to be the unspoken message of PAS when its influential Syura Council came out with a decision to officially sever ties with fellow oppositionist PKR on May 11.

Some observers see this as a first salvo aimed primarily at the PH coalition, and to some extent at the ruling coalition BN to take serious notice of an emerging PAS with a strategic mission and outlook.

Many thought that during the recent Muktamar or party congress beginning in late April, the motion to sever ties with PKR which was unanimously passed by the delegates was a mere rhetorical platitude, simply because the powerful and influential Syura Council did not discuss it at the congress then.

And even if the Syura Council were later to discuss the issue, the prevailing conventional wisdom then was that it wouldn’t dare to endorse the motion, as it will spell the end of PAS as a political force in Selangor, come snap election time. PAS is in a comfortable position in Selangor as part of the state government under PKR. But at this late hour when GE 14 could be called at anytime from now until June next year, PAS is very much aware the idea of a snap election in Selangor is just untenable.

And to top it all, the idea of cutting ties with PKR on the basis of the Islamic concept of Ta’awun (which means to help and compete with each other for the public good) is just a bit mind blowing, coming so soon after Abdul Hadi had expounded on the concept of Tahaluf Siyasi (political cooperation) during the Muktamar to explain some permissible aspects of political cooperation with Umno on issues such as the RUU 355 and support for the Rohingyas.

Some were even amazed at the discrepancy between words and actions, and wondered why can’t the cooperation between PAS and PKR in Selangor be continued under Tahaluf Siyasi instead of Ta’awun. Finally, others wondered what is the difference between Tahaluf Siyasi and Ta’awun?

Tactics and strategies

The key in understanding PAS’ latest strategy is to understand the mindset of the ulama (religious scholars), as the Syura council is basically PAS’ Council of Ulama.

In Islam, ulama are seen as the Inheritors of the Prophets (Warisatul Anbiya) and as such, decorum and due respect for them are to be accorded. This does not mean that one can’t disagree with them or passionately debate with them on issues of importance to the ummah or the nation, for there is no such thing as the concept of excommunication in Islam.

Also important, as mentioned earlier, is the foundational basis of Islam being the reason for the existence and survival of PAS which means the implementation of hudud laws, in however a small way, is the very raison d’être for its participation and existence in the political sphere.

The genius of PAS lies in recognizing that contrary to popular belief, the question of implementation of hudud laws per se is not a controversial issue among Muslims. What is controversial are the issues of timing, nature and scope of its implementation. PAS’ stance on the issue seems to be that these differences of opinion can be ironed out once the first small step of having the will to implement hudud is there.

And so it detested both the loud noises (DAP, MCA, MIC, PPBM and PAN) and the less loud (PKR and Umno) of anyone who opposes this first small step of tabling the RUU 355 in Parliament when these people know very well that tabling it doesn’t necessarily mean the Bill will be passed.

PAS expects that in the unique circumstances of Malaysia being a pluralistic and multi-racial society with its own unique social contract as defined by the Constitution which includes Islam being the official religion of the country by virtue of the Muslims being in the majority and the Malays as the indigenous sons of the soil, a legislature that is characterized by a system of Parliamentary democracy with a Constitutional Monarchy at its core, would be matured enough to allow the Bill to be tabled and discussed in Parliament.

PAS wants the RUU 355 to be discussed so that when a vote on it is finally taken, all would be well should the Bill be approved. If it is rejected, however, PAS will accept the rejection and will have to discuss and decide among its members whether to “fight” for another day or to disband the party, which will render it from becoming a political force in the country, since it has failed to meet its own raison d’être for its existence and survival.

Hence, PAS was shocked to see that all manner of obstacles were vehemently put in place to stop it from doing this small step with such vitriol as if the party is Public Enemy Number One in the legislature and country.

Seen from this perspective, PAS has now grown matured when Abdul Hadi and the Syura Council do not treat the terms Tahaluf Siyasi and Ta’awun as just mere words or actions the way the non-ulamas see these terms.

Instead they see both as two different strategies that are interwoven seamlessly on the basis of PAS’ assessment of itself as a political Kingmaker in the coming GE 14 to get back at those who mercilessly want to “kill” their political existence and survival.

Thus, seen in this light Tahaluf Siyasi is the operative principle for PAS to work with any political party that does not treat Islam/hudud as public enemy number one.

The break with PKR

Why then would PAS cut off ties with PKR under Tahaluf Siyasi and then downgrading the ties to Ta’awun, especially in Selangor?

Based on a media statement issued by Abdul Hadi on May 16, it has a lot to do with PKR leader Datuk Seri Anwar Ibrahim’s Kajang Move in 2014. When Hadi warned PKR not to be reckless on the issue of its three Selangor legislators by heeding the lessons from the Kajang Move, the media statement of Hadi tells more by its silence than by what it says.

In that fateful year, PKR and DAP conspired to let one of the latter’s legislators in the State Assembly of Selangor to resign in order that a by-election could be held in which Anwar will contest, and in the event of a victory, lead the Selangor State Government as Menteri Besar, as part and parcel of his ambitious journey to Putrajaya.

Abdul Hadi was not fully apprised of this Kajang Move by Anwar and Lim Kit Siang/Guan Eng at the initial stage. Had Abdul Hadi known the full details that early, he would have opposed it because it transgresses the Islamic concept of Bai’ah (Oath of Allegiance) that Abdul Hadi sees as compulsorily binding (wajib) between a legislator and the constituents that had voted him.

So he found it distasteful and unpalatable that a serving legislator should resign just to make way for another legislator at the Federal level to contest the state by-election in a power grab. More distasteful was the attempt to oust and shame the then PKR’s MB, Tan Sri Khalid Ibrahim who had done very well but refused to resign.

The Kajang Move became the final straw that broke the camel’s back, as it is clearly seen by Hadi as a form of disrespect to an Alim and relegating PAS to a backwater role in the now defunct Pakatan Rakyat (PR).

When it came to payback time, Abdul Hadi made it difficult for Anwar’s wish to see his wife, Datuk Seri Dr Wan Azizah Wan Ismail, who had contested the said by-election and won, from becoming the Menteri Besar. Wan Azizah once again has to adorn the mantle of a reluctant politician since Anwar was embroiled in the second sodomy case, which disqualified him from contesting.

So Ta’awun becomes the operative principle in a transitory relationship between PAS and PKR in order that both can work together in Selangor for the benefit of the people within the context of observing the principle of Bai’ah in which the three PAS legislators in Selangor are compulsorily mandated to serve their position in the State Exco until GE 14 is called.

GE 14: A look ahead

So what is PAS game plan for GE 14? Clearly, the party relishes on its role and strategy as a Kingmaker. This has already drawn fire from a former managing director of PAS newspaper, Harakah who had commented that it is pointless for PAS to participate in a GE if winning the election is not its objective.

But most of PAS rank and file supported this strategy. They know that by joining the PH, they would be marginalized and relegated by the other partners of PH to a fifth class political party. Even when Anwar was around, they were already being treated as the third among equals.

Moreover, their experiment with being a member of an opposition coalition had never led to the coalition winning the election, with at best only winning the meaningless popular vote, which did not give them the mandate to rule the country.

So they are left with the strategy that could capitalize on their strength – Muslim as opposed to Malay power. Numerical wise, Muslims have a slight majority over Malays because it includes non-Malay Muslim constituents, and this will give a wide berth for it to maneuver in the DAP, MCA and MIC constituencies if they play their cards well.

The reliance on Muslim power does not only include some rapprochements with Umno in certain areas which may include an electoral pact, but also with PAN whom PAS has never considered as an enemy but their lost child, even though members of PAN were the ones who had made the move to unseat the ulama but instead was upstaged by the latter in what could be seen as a testament of Abdul Hadi’s excellent brinkmanship. As for the non-Muslim constituents, PAS would be relying on beefing up their Friends of PAS wing to get the votes for them.

But what remains unsaid is the strong possibility that instead of a kingmaker, PAS may end up as a king itself if providence is on its side. This scenario was not lost on former Law Minister Datuk Zaid Ibrahim who’s now a DAP member, when he warned the opposition to consider seriously the potent combination with or without an electoral pact of the biggest Muslim party (Umno) and the second biggest Muslim party (PAS) ‘uniting’ to become a force to be reckoned with.

Unlike Zaid, the veteran former premier Mahathir who has proven to be a master tactician time and again when it comes to winning election prefers to highlight the Malay power and sidelines the Muslim power in order to show to PAS the folly of its move not to join PH and paint a lose-lose scenario with PAS losing more than PH that could wipe it out of existence, if PAS does not join the PH coalition.

But the chances of PAS heeding Mahathir’s call will be so slim because most PAS rank and file have a long memory of remembering how the former premier had treated a PAS icon, the late Tok Guru Nik Aziz Nik Mat in 1994 with a letter berating the latter mercilessly in a harsh tone without due regard and respect to his position as an alim for wanting to implement hudud in Kelantan.

The letter was in response to the plea of Nik Aziz to Mahathir for his assistance to facilitate the tabling of the hudud bill in the Federal Parliament after the bill was passed by the Kelantan legislature in 1993.

The letter ended with Mahathir’s overt threat that “the Federal Government will take appropriate action against the PAS government in order to maintain the dignity and prestige of Islam and its adherents” should the “State Government of PAS” persisted in its desire to implement hudud.

It is in this context that the PAS supporters whom I spoke to earlier at the beginning of the article were so harsh in their comments on Mahathir, as PAS had to suffer the ignominy of being condemned as a party who had passed the hudud laws but did nothing for more than 10 years to implement it.

“That is the major difference between Mahathir and Najib. You can call Najib by whatever negative epithets you want but at least he has the grace to respect the ulama who are his political opponents by visiting them at the hospital when they are sick and attending to their need in politics,” said the PAS supporter.

“Mahathir’s lieutenants may make fun of this hospital visit in their blogs but they forgot it is an Islamic adab that will earn merits in the sight of Allah to visit any sick person especially if he is your political nemesis, more so if he is an ulama. It is this political capital of respecting the ulama and not shaming them that will be sorely missing among Mahathir and his henchmen in the coming GE,” he added.

Prophecies on Events Very Near to The Last Hour

By Jamari Mohtar

This is an attempt on my part to paint various scenarios of what may transpire during the Last Hour based on the Quran and the Six Sunans or Sahah Sittah (the Six books of authentic Hadith by Bukhari, Muslim, Abu Dawood, Tarmizi, an-Nasai and Ibn Majah or simply known as “The Six Authentic”).

My focus in this instalment is on the two out of the 10 major signs of the Last Hour as foretold by Prophet Muhammad (peace be upon him, s.a.w). These two signs are Gog & Magog, and the Fire of Yemen. Here’s the Hadith on the 10 major signs of the Last Hour:

Allah’s Messenger (s.a.w) came to us all of a sudden as we were talking. He said: “What are you discussing?” We said: “We are talking about the Hour (of Resurrection).” Thereupon, he (s.a.w.) said: “It will not come until you see ten signs before it. He made a mention of the Smoke, the Dajjal (Anti-Christ), the Daabba (the Beast), the Rising of the Sun from the West, the Descent of Jesus Son of Mary (a.s.) (from Heaven), the emergence of Ya’juj and Ma’juj (Gog & MaGog), and Khusuf (Landslides) will occur in three places: one in the East, one in the West and one in Arabian Peninsula. At the end, a Fire would burn forth from Yemen (or from Aden according to Ahmad), which would drive people to the place of their final gathering place.”  (Sahih Muslim, Ahmad).

 A Brief Remark on Gog and Magog

Based on the above Hadith, the majority of Muslim scholars believe that Gog and Magog have not yet entered the world stage. However, based on the work of the great Muslim scholar, Ibn Khatir [b1300CE (701H), d1373CE (774H)] in his Al-Bidayah wa’l-Nihayah (The Beginning and the End), Gog and Magog are two groups of Turks, descended from Yafith (Japheth) the father of the Turks who is also one of the sons of Prophet Noah.

According to some historians, in addition to being the father (ancestor) of the Turks, Japheth is also the father of the Europeans. Some opine that the Scythians (a minor rival of the Greeks) were Gog and Magog descended from Japheth.

The area inhabited by Gog and Magog is said to be in Central Asia, covering an immense land area of over a million square miles extending from western Hungary/Austria eastward to the Aural Sea, north to the Upper Volga, and its southern region extending all the way to the Caucasus Mountains between the Black and Caspian seas.

When the legendary Dhul-Qarnayn met some of the tribes living in that area in one of his three journeys mentioned in the Quran, they asked for his help against Gog and Magog. He built a huge iron fortress for them to prevent the incursion of Gog and Magog into their area. It wasn’t a prison but rather a demarcation of the southern boundary beyond which Gog and Magog cannot proceed further with their adventures. So this has the effect of limiting their playing and killing fields to the north and hence, Gog and Magog are sometimes referred to as the Kingdom of the North.

The Iron Wall of Dhul-Qarnayn was breached during the lifetime of Prophet Muhammad (s.a.w) based on a Hadith narrated by Zainab bint Jahsh (r.a): “… once the Prophet (pbuh) awoke from such a sleep that his face was red and he said: ‘There is none worthy of worship except Allah. Woe to the Arabs, from the great evil that is approaching them. Today a gap as big as this has opened up in the wall of Yajuj and Majuj …’ and the Prophet (pbuh) indicated the size of the hole by forming a ring with his index finger and thumb.” (Sahih Bukhari)

All the above mean Gog and Magog had already entered the world stage in ancient time and the Iron Wall of Dhul-Qarnayn merely limited their freedom of movement to cause debauchery and mischief to the south, and by the Prophet’s time, they were able to breach even this Iron Wall with the existence of the Khazaria Kingdom at the place where the Iron Wall used to stand.

I have touched on this topic in greater details in my previous posts. It is my contention here that the bulk of people forming the army of the Dajjal (Anti Christ) in the Last Hour are going to be the modern descendants of Gog and Magog.

When Prophet Jesus (Isa a.s.) descends to Earth and killed the Dajjal, the bulk of this surviving Gog and Magog based army of the Dajjal will run helter-skelter to hide and join with their fellow Gog and Magog that have not taken part in the battle against Prophet Isa (a.s.). They bide their time and prepare themselves ruthlessly for the final battle and reappear as a new, formidable breed of Gog and Magog to confront Prophet Isa (a.s.) in what can be dubbed as the “Mother of All Battles”.


Islamic Eschatology – The Last Hour

FROM the viewpoint of Islamic Eschatology, the Last Hour will not come until all the minor signs pertaining to its coming have been detected and manifested. Based on the many authentic Ahadith, there are between 70 to 100 minor signs preceding the Last Hour.

Once all these minor signs are manifested, the 10 major signs foretold by an authentic Hadith of Imam Muslim will appear that will herald the beginning of The Last Hour. Note that this Hadith did not list the 10 major signs according to chronology.

The Two-Stage Phase of The Last Hour

A) The End of History – the First Stage

The first stage is what I called the End of History. It is a nerve-wrecking event that will occur with the manifestation of one of the 10 major signs – the appearance of a new, powerful breed of Gog and Magog created by Allah. Prophet Isa (Jesus a.s.), together with the remnants of his Muslim army that had rallied behind him while he killed the Dajjal (Anti-Christ), is no match for this invincible breed of Gog and Magog.

Hence, Allah will command Prophet Isa (a.s.) to bring to safety the remnants of his army, along with the Muslim population that has survived the reign of terror of the Dajjal, by seeking refuge at the top of a mountain. Gog and Magog would besiege them on all sides at the foot of the mountain. They will then devise new weapons of war to be unleashed toward the top of the mountain, targeting Nabi Isa (a.s.) and the Muslims.

This prophecy is contained in a Hadith in Sahih Muslim when Prophet Muhammad (s.a.w.) said: “It will be under such conditions that Allah will reveal to Jesus these words: I have brought forth among My servants such people (i.e. the new breed of Gog and Magog) against whom none will be able to fight; you take these people (i.e. remnants of Jesus’ army and the Muslims that had survived the reign of terror of the Dajjal) safely to Tur (a mountain), and then Allah will send Gog and Magog and they will swarm down from every slope.”

In another Hadith of Imam Muslim, the location of Tur (mountain) is specified:

“Gog and Magog would walk until they reach the mountain of al-Khamr, and it is a mountain of Bait al-Maqdis (Jerusalem), and they would say: “We have killed those who are on the earth. Let us now kill those who are in the sky. They would shoot their arrows towards the sky and the arrows would return to them smeared with blood.”

For the believers (Jesus, his army and the Muslims), this will be the final, greatest trial – facing an enemy that Allah has assured them they cannot vanquish. Only Allah can annihilate this invincible enemy. The situation is rather akin to the earlier battles of Islam in which the fledgling Muslims under Prophet Muhammad s.a.w. faced an enemy many times superior in term of numbers and weaponries.

The psychological scenario of the Muslims under the leadership of Prophet Jesus (a.s.) at this climactic event during the first stage of The Last Hour is also analogous to the earlier Muslims under the leadership of Prophet Muhammad s.a.w. For instance, the Quran in describing the Battle of the Trench, which occurred in 624 CE (Christian Era), says:

“Behold! They came on you from above you and from below you, and behold, the eyes became dim and the hearts gaped up to the throats, and ye imagined various (vain) thoughts about Allah! In that situation were the Believers tried: they were shaken as by a tremendous shaking.” [Quran al-Ahzab (33): 10-11].

The essence and wisdom behind all trials and tribulations faced by humankind in the past, present and future are explained in the Quran when Allah says:

“Or think you that you will enter Paradise without such (trials) as came to those who passed away before you? They were afflicted with severe poverty and ailments and were so shaken that even the Messenger and those who believed along with him said, ‘When (will come) the Help of Allah?’ Yes! Certainly, the Help of Allah is near!” [Quran al-Baqarah (2): 214]. 

Coming back to the first stage of The Last Hour, after a few days of being besieged and attacked from below by this new, powerful breed of Gog and Magog at Mount Tur, the believers (Jesus and his army along with the surviving Muslim population) are hard pressed and disconsolate and they begin to beseech Allah for His Help. In the words of a Hadith narrated by Imam Muslim:

“Jesus and his companions will then be besieged here (at Tur, and they will be so hard pressed) that the head of the ox will be dearer to them than one hundred dinars. Allah’s Prophet Jesus (a.s.) and his companions will supplicate to Allah, Who will then send to them (i.e. Gog and Magog) insects (which will attack their necks) and in the morning they would perish as one single person. Allah’s Prophet Jesus (a.s.) and his companions will descend from Mount Tur, and they will not find on earth as much space as a single span that is not filled with putrefaction and stench. Allah’s Prophet Jesus (a.s) and his companions will then beseech Allah Who will send birds whose necks would be like those of Bactrian camels and they will carry them (the putrefied and stench remains of Gog and Magog) away and throw them where Allah wills. Then Allah will send rain which no house of mud-bricks or (tent of) camelhair will keep out and it will wash the earth until it resembles the mirror.”

If one finds it incredulous the event surrounding the annihilation of the new, powerful breed of Gog and Magog by mere insects, in our own time, we can already see how vicious and fatal to humans, insects like mosquitoes are in decimating a significant proportion of the human species through their epidemic causing dreaded virus of malaria, dengue and zika.

Furthermore, there is a precedent on this in the Quran when some years before the birth of Prophet Muhammad (s.a.w.), the powerful king of Yemen, Abraha and his army of the Elephant, were annihilated by Allah through pebbles thrown at them by the Ababil birds, when they marched to Mecca with the singular intention of destroying the Kaaba.

With the annihilation of Gog and Magog, Prophet Jesus (a.s.) will then rule the Earth as a just ruler for 40 years, heralding the period of everlasting peace and goodwill among mankind on Earth. This is stated in the following Ahadith:

“By Him in Whose Hands my soul is, son of Maryam (a.s.), (i.e. ‘Isa), will shortly descend amongst you people (Muslims) as a just ruler.” (Sahih Bukhari)

“The Hour will not be established until the son of Maryam (a.s.) (i.e. ‘Isa) descends amongst you as a just ruler.” (Sahih Bukhari)

At the time of his death, ‘Isa (a.s.) will have reappeared on this earth for forty years.” (Abu Dawood)

Why is this stage called End of History?

From the viewpoint of Islamic Eschatology, history is nothing more than a continuous struggle between Truth (Haq) and Falsehood (Bathil). Truth is represented by the way of life on Earth that is based on Divine Revelation, while Falsehood is way of life on Earth that is in contradistinction to the Divine Guidance.

This historical battle first began when Adam (a.s.) and his wife, Siti Hawwa (Eve) along with their adversary, Iblis (the Devil) were all dislodged from the Garden of Eden to Earth which became their and their descendants’ temporary abode until the End of Time.

At some points of the historical process Truth held sway over Falsehood, while at some other points, Falsehood held sway. But when in victory, none is able to completely vanquish the other side permanently. This victory is in the nature of the adage that it is all right to lose a battle or some battles, but you must win the war to seal the final victory.

The final victory will take place with the onset of the epic historical Mother of All Battles when Truth is able to vanquish Falsehood completely and permanently during the Last Hour when Prophet Isa (a.s.) i.e. Jesus becomes triumphant with the help of Allah in annihilating Gog and Magog.

This will usher in an era of peace and goodwill on Earth for 40 years with his just rule, thus signifying the start of the first phase of the Last Hour, the End of History. Henceforth, there will no longer be history in the sense that the war between Truth and Falsehood ends.

That period of the End of History will come to an end with the demise of Prophet Jesus (a.s.) where he will die a natural death and will be buried in Medina beside Prophet Muhammad (s.a.w.). His demise will set the second stage of the Last Hour known as The End of Time or simply The End Time.

“After his descension on earth, Prophet Isa (a.s.) will marry. He will have children, and he will remain on earth 19 years after marriage. He will pass away and Muslims will perform his Salaat Janaza (funeral prayer) and bury him next to Rasulullah (s.a.w).” (Tirmidhi)

B) The End of Time – the Second Stage

Before this second stage occurs, there are some events during the lifetime of Nabi Isa (a.s.) that will pave the way for this.

For the first seven years of his just rule on Earth, there will be no rancour between any two persons. After that, Allah will send a cold wind from the direction of Syria and this will slowly envelope and cause the good and pious people to die.

By the time of Nabi Isa’s death, this process of good and pious people dying through the cold wind speeds up and gains momentum so that there will come a time some years after the demise of Jesus when the Earth is populated by bad and evil people.

This prophecy is contained in the two ahadith in which the Holy Prophet (s.a.w.) said:

“At that time Allah will send a pleasant wind, which will soothe (people) even under their armpits. He will take the life of every Muslim and only the wicked will survive who will commit adultery like asses and the Last Hour would come to them.” (Sahih Muslim)

“Then people will live for seven years, during which time there will be no rancour between any two persons. After that Allah will send a cold wind from the direction of Syria. None will survive on Earth, having a speck of good in him or faith in him: he will die. Even if some among you were to enter the innermost part of the mountain, this wind would reach that place also and cause your death. I heard Allah’s Apostle (s.a.w.) as saying: Only the wicked people will survive and they will be as careless as birds with the characteristics of beasts. They will never appreciate good nor condemn evil. Then Satan will come to them, in human form, and would say: Don’t you respond? They will say: What do you order us to do? He will command them to worship the idols but, in spite of this, they will have an abundance of sustenance and lead comfortable lives.” (Sahih Muslim)

Notice that there is actually no battle here between Truth (Haq) and Falsehood (Bathil) as the stage of the End of History has long passed with the demise of Prophet Jesus (a.s.). What happens here is that Allah takes away the soul of the good and pious, and hence by default Falsehood prevails to face alone the fury of the End Time.

The Fire of Yemen – Start Time of the End of Time

Then the stage is set for the second stage of the Last Hour i.e. the End Time. This stage will begin with a fire that would burn forth in Yemen – another sign of the 10 major signs foretold by an authentic Hadith of Imam Muslim.

“Allah’s Messenger (s.a.w.) came to us all of a sudden as we were talking. He said: “What are you discussing?” We said: “We are talking about the Hour (of Resurrection).” Thereupon, he (s.a.w.) said: “It will not come until you see ten signs before it. He made a mention of the Smoke, the Dajjal (Anti-Christ), the Daabba, the Rising of the Sun from the West, the Descent of Jesus Son of Mary (a.s.) (from Heaven), the emergence of Ya’juj and Ma’juj (Gog & MaGog), and Khusuf (Landslides) will occur in three places: one in the East, one in the West and one in Arabian Peninsula. At the end, a Fire would burn forth from Yemen (or from Aden according to Ahmad), which would drive people to the place of their final gathering place.”  (Sahih Muslim, Ahmad)

“The people will be gathered in three methods:

  1. The first batch will be of those who wish or have a hope (for paradise) and have a fear (of punishment).
  2. The second batch will comprise those who will come to gather, riding: two on a camel, three on a camel, or ten on a camel.
  3. The third batch will be the rest of the people who will be urged to gather by the Fire which will accompany them at the time of their afternoon nap and stay with them where they will spend the night, and will be with them in the morning wherever they may be then, and will be with them in the afternoon wherever they may be then.”  (Sahih Bukhari)

The Swooning Trumpet

This is then followed by the sound of a Trumpet in which all mankind and every living creation of Allah including those in the heavens will immediately faint (swoon) and die. After a lapse of some time, the second Trumpet will be blown indicating the Day of Resurrection followed by the Day of Judgement.

This is encapsulated in the following Quranic verse and Hadith:

And the Trumpet will be blown, and all who are in the heavens and all who are on the earth will swoon away, except him whom Allah wills. Then it will be blown a second time, and behold they will be standing, looking on (waiting)” [Quran, al-Zumar (39):68].

“Abu Hurairah said: The Messenger of Allah (s.a.w.) said: “Between the two blowings of the Trumpet there will be forty.” The people said, “O Abu Hurairah! Forty days?” I said: “I am not sure.” They said, “Forty years?” I said: “I am not sure.” They said, “Forty months?” I said: “I am not sure. Then Allah will send rain down from the sky and they will grow as herbs grow. There is no part of a man which will not decay except a single bone at the base of the coccyx, from which he will be re-created on the Day of Resurrection.”  (Muttafaq Alaih)

Imam al-Nawawi said: “What is meant by the words of Abu Hurairah, “I am not sure” is that he could not be certain as to whether what was meant was forty days or years or months; all that he was certain of was that it was forty in general terms. 

In Sahih Muslim, it is narrated that ‘Abd-Allah ibn ‘Amr (r.a.) said: “The Messenger of Allah (s.a.w.) said: “… then the Trumpet will be blown and no one will hear it but he will bend his neck to one side and raise it from the other side. The first one who will hear it will be a man who is busy in setting right the cistern meant for supplying water to the camels. He will swoon and the other people will also swoon. Then Allah will send down rain, which will be like dew and there will grow out of it the bodies of people. Then the trumpet will be blown again, and they will stand up and begin to look around.”  

A Third Trumpet?

There is a minority view among the scholars, which says that the Trumpet will be blown thrice – the first Trumpet where people will be terrified, the second, when people will faint (swoon) and die, and the third, when people will be resurrected. But this is based on a weak hadith.

The proponents of a third Trumpet said their view is also based on the difference they noted between the above az-Zumar verse which mentioned about swooning alone, and the an-Naml verse below which talked about being terrified alone, alluding to the existence of a third terrifying Trumpet.

“And (remember) the Day on which the Trumpet will be blown, and all who are in the heavens and all who are on the earth, will be terrified except him whom Allah will (exempt). And all shall come to Him, humbled” [Quran al-Naml (27):87]

But the fact that swooning is mentioned in one verse and terror is mentioned in another does not mean, according to most scholars, that they will not happen at the same time when the Trumpet is blown for the first time. Rather they will happen at the same time, so when the Swooning Trumpet is blown the people will be terrified, and will swoon as a result and die.

Then they will remain in that situation for 40 periods of time (the narrator is not certain whether that time period is in days, months or years) as decreed by Allah. Their bodies will decay within this period until there is nothing left but the bone from the base of the coccyx, which is a round bone at the base of the spine.

Then Allah will send a cloud that will release rain, and when the water reaches this bone, the body will grow from it like a plant grows and they will be recreated from this bone, just as Allah created them the first time, for He is able to do all things.

Then a second Trumpet will be blown to signal the Resurrection, and the souls will return to their bodies and will come forth from their graves and hasten to the place of gathering.

If the one who most feared Allah, said, “How can I be at ease when the one who blows the Trumpet (Angel Israfil), has put it to his mouth, bent his forehead and inclined his ear, waiting to see when he will be ordered to blow it?” – as narrated by al-Tirmidhi and others – then what about us who are weak and fall short?

We ask Allah to make us among those who will not be grieved by the greatest terror when the angels will meet them (with the greeting), “This is your Day which you were promised.” [Quran al-Anbiya (21):103].

Welcome to the Post-Truth World Order!

I had to scratch my head going through the materials while doing research for my article on the rapid development in Pengerang for Focus Malaysia, which was published early this month.

Apart from the confusion between what is Pengerang Integrated Complex (PIC) and Pengerang Integrated Petroleum Complex (PIPC), the question of whether the Saudi’s state-run oil and gas behemoth, Aramco will participate in the Refinery and Petrochemical Integrated Development (Rapid) project at the PIC added a further headache. And now my conclusion is the Rapid project in Pengerang will indeed be a rapid development, with or without the participation of Aramco.

To put the issue in perspective:

  • First, since late last year, we have had the morale boosting news that has further fuelled the sense of optimism in the oil and gas (O&G) sector in Malaysia that Petronas is set to make a final investment decision (FID) to bring in Aramco as its partner for the Rapid project, which is part of the PIC, which in turn is part of the bigger PIPC.
  • Next, in early January this year, came the comment from the Johor Petroleum Development Corporation (JPDC) CEO, Mohd Yazid Ja’afar, in my interview with him that ‘we were advised by Petronas that the Rapid project is progressing according to schedule and as of early January 2017, the progress update for PIC is at around 54% completion’.  I took this to mean there is really no problem for Petronas to complete the remaining 46% on schedule by early 2019, as it is not starting from scratch. And with the improved global oil prices expected this year, Petronas would have the wherewithal to finance the Rapid project on its own in the event that Aramco declines to participate in the planned partnership.
  • Then a week after the interview with Yazid, two seemingly contradictory news entered the fray – one from the Wall Street Journal quoting sources that Aramco has scrapped plan to partner Petronas in the Rapid project, and a Reuters’ report again quoting sources that Aramco has merely shelved the plan for the project.
  • In their response, both Petronas and Aramco said they would not comment on rumour or speculation, with the latter emphasising that it would continually evaluate new businesses.

Despite their response, post-truth phenomenon which one would normally associate with the Brexit vote and the Trump Administration started to pour in, which among other things, asserts without solid proof that Middle Eastern investors were losing confidence in Malaysia or Arab investors were fleeing the country or many other versions to that effect.

This has caught the ire of Second Finance Minister Johari Abdul Ghani who said the project was never led by the Saudis in the first place. He said Petronas had been executing it on its own “since Day One”.

“The funding of this project until its completion has always been based solely on Petronas’ own strength. The possibility of having Aramco as a partner to share the project was only an option. Since Petronas could not agree to some of the terms, the two parties decided to stop the negotiations and move on.”

He said Aramco and Petronas could “always revisit the negotiations” if they could come to an agreement at a later stage.

“Sometimes, in a negotiation or venture, we don’t get the terms that we want, and this is normal,” he said.

“We need to make sure that foreign investors coming into our country will create win-win situations for us and them. Things cannot be one sided.”

Taking into account that King Salman of Saudi Arabia will be visiting Malaysia soon, Johari’s explanation makes more sense. It is normal for a huge project like Rapid that takes the proposed form of an international joint venture (IJV) will have problems in negotiations, and normal too for Head of the respective governments in the IJV to help smoothen the problems.

Rapid momentum at the Pengerang Integrated Petroleum Complex (PIPC)

 Despite the challenging global economic climate and the controversy over attracting foreign direct investments (FDIs) which have caused the big global boys to dither on final investment decisions, the Johor Petroleum Development Corporation (JPDC) tasked with developing the Pengerang Integrated Petroleum Complex is optimistically on the ball to create momentum by wooing small and medium sized enterprises (SMEs) to partake in the development of the Complex.

Normally, the strategy is to get the big players to come first and then the SMEs will follow suit in their supporting and complementing roles. However, different circumstances require different strategies and that is why while understandably waiting for the big boys to arrive at a final decision, the JPDC ingeniously decides to welcome the SMEs first.

These days, the head honcho of the JPDC – a federal agency created under the Prime Minister’s Department, with the main mandate to plan and develop strategies for downstream O&G development in Johor – doesn’t have the luxury to think about other matters.

His mind is singularly focused on coordinating and driving the execution of development projects to make the PIPC situated on the southeastern side of Johor, Malaysia’s premier downstream O&G hub in the region.

A veteran of O&G with 15 years of experience as an engineer in Shell, and now helming the JPDC as its Chief Executive since 2012, Mohd Yazid Ja’afar has his job cut out for him when he and his team have to ensure that PIPC’s refining activity is operationally ready by early 2019. This is the next key milestone after the commencement of storage and trading activities in PIPC in April 2014 that has marked the start of PIPC operations.

Flurry of optimism bodes well for the Oil & Gas sector

After being in the doldrums since global oil prices plummeted from a peak of around US$115 per barrel in mid June 2014 to US$68 six months later, and hit rock bottom at US$26 in February 2016, the O&G sector is now brimming with optimism in Malaysia.

Analysts say the government’s unwavering focus – in the face of a challenging global economic climate – on developing a world-class O&G hub at Pengerang in Johor, which is envisioned to be similar to the Amsterdam -Rotterdam – Antwerp (ARA) model that has areas of refining, storage and blending capacities as well as market access, is responsible for this flurry of optimism.

The idea of developing the Pengerang Integrated Petroleum Complex (PIPC) as a driver of the country’s quest to be a regional O&G hub was conceived way back in 2007 during the heyday of rising oil prices.

The 20,000 acre PIPC was launched in 2012 amid much fanfare as part of the Economic Transformation Programme, making it the largest integrated greenfield development in a single location, equivalent to 3,500 football fields.

Pengerang was chosen due to its strategic location near shipping lanes, deep-water port facilities, large acreage and close proximity to regional demand centres.

Meanwhile, the Pengerang Integrated Complex (PIC) – part of PIPC covering an area of 6,242 acres – is a US$27-billion mega development that includes the Rapid project and six associated facilities.

It will complement the existing infrastructures, attract foreign companies to invest and invite potential collaborations with global partners in logistics and product distribution.

This is turn will spur the growth of Malaysia’s O&G downstream sector, thus pushing the nation into a new frontier of technology and economic development.

While development at the PIPC is within the purview of JPDC, PIC, on the other hand, is handled by the national oil company Petronas, being one of its key projects that would deliver future growth for itself and at the same time, complements the southern Johor economic corridor.

However, with the plummeting of global oil prices starting in the second half of 2014, many observers opined that countries like Malaysia, which are net exporters of oil and are very dependent on oil revenues to finance the growth of their economy, would be badly hurt.

Doomsayers were fast and furious in saying that with the upstream business of exploration and production (E&P) adversely affected with falling oil prices, the government and Petronas will be in dire strait to cough up the fund needed to develop the PIPC and PIC respectively. Reading their prognosis, it seems as if it is the end of the world for the O&G sector in Malaysia.

To the credit of the government and Petronas, they do not pay heed to this pessimism. On the contrary, they continue to strive and work hard to make the vision of a regional O&G downstream hub in Pengerang a reality by remaining steadfast in pursuing this vision and never once put a halt to the project, even when oil prices hit their bottom at US$26 per barrel in February 2016.

In an interview with FocusM, JPDC’s Chief Executive, Mohd Yazid Jaafar, says falling oil prices will definitely affect the upstream business associated with E&P, but it is actually a boon to the development of the downstream business.

“This is because the cost of developing and running refineries and petrochemical plants is much lower now. Liquefied natural gas (LNG) and the feedstock are cheaper too. Thus, the upside now is in the downstream sector.

“Moreover, projects such as the PIPC are the drivers behind decreasing federal dependencies on commodities, as we won’t be relying on locally produced crude oil. We’ll be importing (which is cheaper), adding value by processing the materials onsite, and basically moving Malaysia up the chain.” he adds.

The global oil market has been riding on a wave of euphoria after the Organisation of Petroleum Exporting Countries (Opec) announced on Nov 30 last year that it would cut production of crude oil by 1.2 million barrels per day (bpd) beginning Jan 2017 for a period of six months. On Dec 10, Opec managed to secure agreements from some non-Opec members including Russia to cut another 600,000 bpd, making a total cut of 1.8 millon bpd.

This cut would help to clear the long-standing glut of production and high inventory levels of crude oil globally and lift prices. But Opec warned that although the production cut would speed-up the re-balancing of the global oil market, it would not result in demand exceeding supply until the second half of this year.

But this is a good enough New Year present for the O&G sector in Malaysia, as it would mean oil prices will stabilize high enough to allow for the resumption of high E&P activity at the upstream level, spurring greater level of confidence and optimism in the industry.


p.s. So why do I give a heading of post-truth world order for this article? Post-truth politics/philosophy is now an emerging subject in political science and philosophy in some universities of the world. Its genesis began in the aftermath of the great recession of 2008 in which the divide between the have and the have-not was at its greatest and global household debt was at its highest due to the easy money policy brought about by quantitative easing (QE) of the US Fed that had driven interest rate to the lowest allowing people to borrow as if there is no tomorrow. All these caused dissatisfaction and deep seated grievances directed, whether rightly or wrongly, at the establishment. With social media rearing its ugly head, the situation is ripe for demagogues to exploit the social media and use it effectively by tapping into these deep-seated grievances. Thus, truth is no longer based on real objective facts but on who has the loudest voice in the social media. No wonder President Trump is the only US President who is very fond on the verge of addiction in using Twitter, Facebook etc in making his official pronouncements.



Johor Petroleum Development Corp wants them to participate first before big boys come a-calling

By Jamari Mohtar

Focus Malaysia | February 4, 2017


DESPITE challenging times facing the oil and gas (O&G) industry, the Johor Petroleum Development Corp (JPDC) tasked to develop the Pengerang Integrated Petroleum Complex (PIPC) is pushing ahead to woo small and medium sized enterprises (SMEs) to develop the mammoth complex.

Normally, the strategy is to get the big players to come aboard first, followed by SMEs in support and complement roles. However, different circumstances require different strategies, and that is why while waiting for the big boys to make their final investment decision, JPDC has rolled out the carpet to welcome the SMEs first.

These days, Mohd Yazid Ja’afar, CEO of JPDC – a federal agency created under the Prime Minister’s Department, with the main mandate to plan and develop strategies for downstream O&G development in Johor – doesn’t have the luxury to think about other matters.

His is focused on coordinating and driving the execution of development projects to make the PIPC situated on the southeastern side of Johor Malaysia’s premier downstream O&G hub in the region.

Helming the JPDC since 2012, Mohd Yazid Ja’afar has his job cut out for him, as he and his team have to ensure PIPC’s refining activity is operationally ready by early 2019. This is the next key milestone after the commencement of storage and trading activities in PIPC in April 2014.

Platform for SMEs

Mohd Yazid tells FocusM about anchoring development on SMEs and the people of Johor.

“We want SMEs to treat PIPC as a platform to provide them with opportunities to realise their own visions. Just discuss with us your plan and we will help you to realise your vision through three industrial parks that our investors are going to set up this year at PIPC,” he says.

Launched in 2012, the 20,000-acre PIPC is part of the Economic Transformation Programme, making it the largest integrated greenfield development in a single location, equivalent to 3,500 soccer fields.

The industrial parks, occupying a total of 2,879 acres would provide space for investors of future downstream and support services to operate. “Our approach is to dedicate certain area of the industrial park for a particular sector SME in the value chain to interact and do business with the providers of core activities of PIPC in an inclusive and integrated way,” adds Mohd Yazid.

They are:

  • Dialog-Sungai Rengit Industrial Estate operated by Dialog Group Bhd. This 333 acres industrial park can accommodate petroleum and chemical storage facilities & warehouses, petrochemical manufacturing industries, bottling and drumming plants, and open yard storages;
  • Spektrum Budi-Pengerang Maritime Industrial Park to be developed on 1,760 acres of reclaimed land for activities like fabrication yard, oil terminal, warehousing and light industries; and
  • JCorp-Pengerang Industrial Park operated by the state-owned enterprise Johor Corporation (JCorp) for the first phase of the development on 786 acres.

Work on phase 1 of the first two industrial parks will start this month and phase 2 in January next year. JCorp started the application process for the development of JCorp-PIP late last year.

JPDC is working with several state-owned enterprises such as Perbadanan Islam Johor Holdings (PIJH) to provide spaces for bumiputera incubators.

It is also collaborating with JCorp to develop an area in PIPC for SMEs and downstream industries in the O&G supply chain, including those in the petrochemicals.

The idea is to create an ecosystem for different industries to complement each other. To bring this idea to life, it is also working with providers of services like communications and information technology to provide the right support.

“The state government-linked companies (GLCs) are the best partners for PIPC at this stage but private players are more than welcome as well. JPDC has engaged with various manufacturing association and groups including the Malaysian Plastics Manufacturers Association (MPMA) and we would like to urge private players to take advantage of the opportunities that such an ambitious project presents.

“For the GLCs, this project is a chance to help them monetise their land. All they need to do is develop the land and provide a space for the industries. For private players, PIPC offers an upside opportunity for them to come in as active participants along the value chain,” says Mohd Yazid.

With dedicated Government forums from both Federal and State to fast track development at the PIPC, the JPDC has been working hand in glove with the Johor state and federal authorities to provide the needed infrastructure for the people and workers at the PIPC.

These currently include the construction of a Taman Bayu Damai Police Station (to be completed in April this year), the new 4-lane dual carriageway ring road (end June 2017) and Health Clinic at Sungai Rengit (end Dec 2017). These are no ordinary public infrastructures but specialised ones to meet and adapt to the kind of dangers, mishaps or investigations that are unique to a mammoth, integrated complex such as PIPC.

The Johor Menteri Besar, Dato’ Mohamed Khaled Nordin recently launched the PBT Pengerang, the Pengerang local authority on Jan 16. This new local authority in Pengerang comprises people with the experience, expertise and track record of developing industrial park in Pasir Gudang that will help further improve the overall effectiveness and efficiency of PIPC’s development and management.

“The Johor State government intends to position the development in Pengerang as the catalyst for growth for the east Johor corridor. It hopes to transform the area into an economic district of global importance. The strategies on SMEs and public infrastructures are part of the transformation effort,” says the Chief Executive.

Global players

So what about the participation of global players in the O&G industry? JPDC’s head honcho admits that SMEs wouldn’t come aboard without big-name global companies participating in the PIPC project.

“Our strategy is to ensure that there is the presence of Fortune 500 companies to anchor the development. Their presence will definitely create confidence not only to fellow Fortune 500 companies but also the local and international SMEs to set up base in PIPC. And we already have two,” says Mohd Yazid.

Petroliam Nasional Berhad has been anchoring the development of the Refinery and Petrochemical Integrated Development (Rapid) project since 2012.

The other big player is Royal Vopak of Netherlands which together with Dialog Group Bhd and Johor State Secretary Incorporated (SSI), had formed a consortium since 2012 to build the Pengerang Deepwater Terminal (PDT), which has been operating since 2014.

Mohd Yazid says JPDC has seen a lot of interest from local and foreign potential invstors.

“However, due to falling global oil prices and a slowdown in China’s economy, some of the potential investors are a wait-and-see stance before making their final decisions.”


Rapid on track despite Aramco blow

THE Johor Petroleum Development Corp (JPDC) is confident the progress of the Refinery and Petroleum Integrated Development (Rapid) project in Pengerang Johor will not be affected, despite reports that Saudi Aramco had scrapped plans to partner Petronas in the project.

Speculation had been rife that Petrolium Nasional Bhd (Petronas) will offer a 50% stake to Saudi Arabia’s state-run oil and gas giant, Aramco in the US$27 bil (RM119.6 bil) Rapid project.

However, foreign news report a fortnight ago indicated the deal is dead in the water. Both quoting sources, The Wall Street Journal said Aramco had scrapped its plan to partner Petronas in the Rapid project, while a Reuters’ report said the Saudi company had merely shelved the plan.

Nevertheless, JPDC officials are optimistic that with improving global oil prices expected this year, Petronas would have the resources to finance the project on its own even if Aramco scraps the planned partnership.

“We were advised by Petronas that the Rapid project is progressing according to schedule and as of early January 2017, the progress update for PIC is at around 54% completion,” JPDC’s CEO Mohd Yazid Ja’afar tells FocusM.

This mirrors the national oil corporation’s statement that the project is going ahead. “Petronas would like to clarify that its Pengerang Integrated Complex project will continue to be the focus of its downstream growth agenda in the coming years,” it said in its statement to Reuters. However, the statement made no reference to Aramco.

Aramco said it would not respond to rumour or speculation on the matter, emphasising that it would continually evaluate new businesses. It’s possible move to suspend plan for the Malaysian venture comes at a time when Petronas is struggling with the depressed oil price. Early last year, Petronas announced it would cut spending by up to RM50 bil over the next four years.

Rapid is part of PIC, and both are within the much larger Pengerang Integrated Petroleum Complex.


The curious case of Donald Trump: Is polling a useless predictor of outcome?

By Jamari Mohtar | Nov 10, 2016

The reliability of political polling to predict the outcome of an election is put into question when despite and in spite of most polls predicting Hillary Clinton as the favourite to win, albeit in a close fight because all polls are within their margin of error, Donald Trump against all odds clinched the trophy of the presidency.

Before we come to the conclusion that polls are a useless predictor of outcome, let’s hear some quotable quotes on statistics:

“There are lies, damned lies and statistics.” Mark Twain

 “It is the mark of a truly intelligent person to be moved by statistics.”  George Bernard Shaw

 “Smoking is one of the leading causes of statistics.”  Fletcher Knebel

I like most the quote by Fletcher Knebel because it hinted at arriving at something with no concrete substance as the aim of statistics, and to wit, we are all indeed “smoked” by the polls that said Hillary Clinton has a 90% chance of winning the presidency on the eve of Election Day.

Ignoring historical precedent at one’s own peril

 There are more than one ways to predict the outcome of presidential election other than polls.

A few hours before the results of some exit polls were announced on Election Day, I told friends through one of my WhatsApp groups that Hillary Clinton might not be elected as President, if we go by historical precedent.

Since term limit was imposed in 1947 – curbing presidential term to no more than two terms (eight years) – there has never been an instance where a Democratic presidential nominee won an election after eight years of incumbency by a Democratic president.

That is why Clinton lost after eight years of a Democrat Obama; Al Gore too (2000 election) after eight years of a Democrat Bill Clinton; and finally Hubert Humphrey (1968) after eight years of Democrats John Kennedy and Lyndon Johnson.

Whereas Donald Trump has a greater chance to win because there is one instance of history in which a Republican nominee won the election after eight years of incumbency of a Republican presidency. Who was he? None other than the one term President HW Bush who won in the 1988 election after eight years of Republican Ronald Reagan.

I am an ardent fan of history (and of ‘isteri’ too) although I’m aware that students pooh-pooh the study of history, one reason being it does not make you fabulously wealthy as compared to the study of law or medicine although I have come across poor lawyers and poor medical doctors. But as the outcome of the recent US presidential election, the Brexit vote and in fact most significant global events – even significant event at the personal level – have shown, one ignores history at one’s own peril.

This peril of ignoring history is famously encapsulated in the adage that history has a tendency to repeat itself. Even the natural phenomena of life have a habit of repeating themselves such as the repetition in the observable change in the days following the nights, of being healthy followed by being sick, of birth and death, and the boom and bust of the economic/business cycles.

Nonetheless, I’m not that naïve to believe that historical precedent is the only thing that matters. My view of history is as follows:

History seldom moves in a linear fashion. And that is why we don’t see new changes or new things everyday. Instead it moves in gradual non-linear twists and turns, giving us glimpses of an approaching historically repeating event in the making, where we feel things on the surface are the same as of yesteryears, yet with some qualitative differences in their essence. Once we get to feel this sensation of the same yet different, there will be many more non-linear twists and turns for years, before the full force of the repetition occurs.

At times history does not repeat itself at all but propels forward with a quantum leap as if in a three dimensional setting that demolishes every known assumptions with the onset of new inventions and discoveries or simply paradigm shift, heralding the emergence of a brave new world instead of the repeated old world. This then becomes a new normal and ultimately a status quo normal when it keeps repeating time and again before another quantum leap occurs.

Statistical disinformation or the fallibility of statistics

Now, let’s come to the crunch. Are political polls really useless as a prediction of outcome? One cannot blame those who say they are when the example of the Brexit vote is still fresh in our mind. Despite the narrowing of margin in polls as voting drew near in June, the majority of the polls were still predicting the Remain in EU would win, albeit with a small margin.

And last year in Askenazi Israel, despite exit polls had forecast a dead heat, Bibi Netanyahu’s right-wing Likud Party still won a surprise victory over its main rival, the centre-left Zionist Union.

But if you understand statistics in the context of the probability theory, you’ll be humbled enough to know that a poll which said that Hillary Clinton has a 90% chance of winning the election does not mean it’s a sure 100% win and that the 10% chance of Clinton losing is something that can take place in the realm of reality. In this sense, there is really no big deal in blaming polls for the different outcome than what was expected, as long as the different outcome is not a regular feature of the US election polls.

The last time the polls were dead wrong was in 1948 when Harry Truman was predicted to have lost the election, with one newspaper having circulated an early edition the day after election, which showed Thomas Dewey to be the winner as its page one lead story. The editors had had a hell of time in withdrawing that early edition.

Hence, the utility of polls as a predictive tool lies not so much in its accurate predictive power of the outcome ALL THE TIME, but rather a prediction that is dead accurate MOST OF THE TIME – giving credence to the notion of the working in the real world of the principle of an exception to the rule.

We can’t even predict with dead accuracy what’s going to happen to us in the next few hours, and yet we don’t want to eat humble pie in accepting that our prediction – the prediction of mere mortals – might go wrong when it comes to election polls. That is indeed arrogance of the highest order!

Of course there is nothing wrong in doing a sort of post mortem to get the answer on why and where did the polls go wrong, especially after the humble pie has been eaten. The least that this will result is in the lessons learnt to ensure that there will be a less frequent occurrence of the principle of exception to the rule, which it is meant to be for otherwise we would be living in a world of chaos. And then He who is in Heaven will smile approvingly at our action to learn from past mistakes and to minimize the exceptions!

And that is why I’m deeply moved when an intelligent and scholarly man says, “It is the mark of a truly intelligent person to be moved by statistics.” (Ahem, ahem…)

A ‘new’ normal?

 So what went wrong? I’m in no position to tell what went wrong scientifically though I took statistics at the undergraduate level but didn’t do well in that subject (actually within a certain margin of error, I did well in the exam, hehe). Based on news reports in the US, it is not so much statistical error that is at fault but systematic error.

Statistical error has to do with the methodology the pollsters used which will lead to among others, the questions of the representativeness of the sample (sampling error), the sample size so chosen (size error) and the degree of freedom assumed which will impact the level of confidence in prediction.

Experts have all been unanimous that the statistical errors were all within the threshold of acceptability statistically. Remember that statistics is not a science that is about 100% accuracy all the time and if you perceived it as such and refused to accept the existence of acceptable statistical errors, you (the layman) are exhibiting arrogance of the highest order.

So it is the systematic error that is in question which in layman term can be phrased this way: “Yes, the sampling method was right, the sample size was right but what are the questions that you asked the voters? Is it leading questions such that the result of the poll is what you (the pollster) want to hear rather than asking objective questions that beget objective answers?

The systematic error could also be explained in the way the final consumers of the poll (not the pollsters themselves but the media and Clinton’s campaign staff who commissioned the pollsters) spin the pollsters’ analysis in accordance with their own agenda of supporting Hillary at all cost whether consciously or not.

In this regard, Trump actually made sense when he alleged during campaigning that the election was rigged but he was far off the mark when he said that these people (the pollsters) were interviewing each other rather than random voters.

Perhaps he gave this stupid reason out of desperation because the analysis of his own pollsters had shown him that he had a good chance of winning in the battleground swing states.

But instead of seeing all these in term of polling errors, I’m of the view that the 2016 US election is a watershed election because it sees the emergence of a new normal as exemplified in Trump getting away unscathed for:

  • Not showing his tax returns;
  • Speaking outrageously against women, the Blacks, Latinos, Muslims, China and Mexico, etc;
  • Mimicking the gestures of the handicaps and his opponents; and
  • ‘Brawling’ with his fellow Republicans including Speaker Ryan

Seeing the above as a new normal also implied that perhaps the Muslims and others too should ultimately judge him based on the policies that he will finally implement as a President, rather than based on his speeches during the heat of the moment when campaigning.

The fact is for about three months after winning the election he is not the President of the USA, Obama is. President elect Trump will be just as lame-duck as the real President during these three months until his inauguration in late January, and due to this, it does not make sense to be emotional about him during this period.

So how do we predict the outcome of a Trump presidency under this new normal scenario? Is there any historical precedent? There is, actually.

When Nikita Khrushchev succeeded Josef Stalin as the Soviet leader in 1954, his outrageous behavior at the UN Assembly in 1960 by repeated banging of his shoe in protest at a speech by the Philippine delegate, Lorenzo Sumulong, had made him a Soviet leader with a relatively brief reign as compared to his predecessors who ruled until their deaths.

So in light of a new normal and a historical precedent, the relevant question to ask about Trump in relation to predicting the outcome of his presidency is not so much whether he will be a one term president; rather the question is will he serve the full duration of his first term?

Only time will tell whether the latter outcome will see the light of day! So far since winning the election, Trump’s actions and sayings are presidential.

A global federation of educators to bridge gap between theory & practice of Islamic Finance


I am under the impression that fatwa-shopping refers to the e-fatwa that proliferates on the Internet where one can pick and choose the fatwa (religious edict of a Mufti) that is in alignment with one’s own view or interest.

This cherry picking of fatwa is often done to ‘whack’ the views of others that one differs from in matters of peripheral differences of opinion on some religious issues. Very often too, this pick-and-choose fatwa is used to reinforce one’s view in a controversial religious issue by exclaiming: “I told you so… this fatwa is proof that my position is right.”

But don’t be surprised that this phenomenon of fatwa-shopping may occur at the professional discipline of Islamic Finance.

The issue was first raised in 2009 when Sheikh Muhammad Taqi Usmani of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), a Bahrain-based regulatory institution that sets standards for the global Islamic Finance industry, said that 85% of sukuk, or Islamic bonds, were un-Islamic.

This was later reiterated by financial journalist John Foster, a former editor of Islamic Business & Finance magazine. Here’s his account:

“… this new generation of Islamic bankers had cut their teeth in the City and Wall Street, and were used to creating sophisticated financial products.

“They often bumped heads with the Sharia scholars who authorised their products as Sharia compliant.

“However, these bankers had a way of dealing with this, as one investment banker based in Dubai, working for a major Western financial organisation explains:

“We create the same type of products that we do for the conventional markets. We then phone up a Sharia scholar for a Fatwa [seal of approval, confirming the product is Shari’ah compliant].

 “If he doesn’t give it to us, we phone up another scholar, offer him a sum of money for his services and ask him for a Fatwa. We do this until we get Sharia compliance. Then we are free to distribute the product as Islamic.”

But I don’t think most Syariah scholar sitting on the Syariah Supervisory Board (SSB) of Islamic financial institutions (IFIs) are easily compromised though I’m very much surprised by the magnitude of sukuk that Sheikh Muhammad Taqi Usmani claimed to be un-Islamic (read: non Syariah compliant).

Furthermore, there are genuine differences of opinion among the asatizah on some aspects of Fiqh Muamalat (Commercial and Transaction Laws in Islam).

In this regard, Malaysian small investors of Islamic financial products are fortunate because there is now the Ombudsman Financial Services (OFS), which began operation on Oct 1.

Bank Negara gave its seal of approval for the operationalization of the OFS to provide a fair and efficient avenue for financial consumers to resolve disputes against financial service providers.

This means consumers that have issue with the Syariah compliance of an Islamic financial product or service that they have bought may bring it up to the OFS, which is an independent redress mechanism with minimum formality for financial consumers to resolve disputes with financial service providers.

To those of my asatizah friends who happen to sit on SSB of IFIs, I hope you have the integrity to realise that religious injunctions are not for sale. My doa that you’ll be given the guidance by Allah to act in an honest, just and equitable manner, Aamiin.


A global federation of educators to bridge gap between theory & practice of Islamic Finance

By Jamari Mohtar

Guest Writer

Focus Malaysia | Oct 22, 2016


KL Declaration calls for Centre for Islamic Economics IIUM to play key role as Secretariat to the proposed International Federation of Islamic Economics and Finance Educators (I-FIEFE)

I NODDED in full agreement when the Kuala Lumpur Declaration at the end of the 11th International Conference on Islamic Economics and Finance (ICIEF) held in the capital of Malaysia recently, made a clarion call for the setting up of an International Federation of Islamic Economics and Finance Educators (I-FIEFE) to bridge the gap between the theory and practice of Islamic Economics and Finance, and produce qualified manpower for the industry.

The KL Declaration also calls for the Centre for Islamic Economics, International Islamic University, Malaysia (IIUM) to play a key role as the Secretariat for I-FIEFE. The secretariat is expected to commence work immediately with support from all parties including the government of Malaysia as well as agencies such as the Islamic Research and Training Institute (IRTI) of the Islamic Development Bank (IDB) Group and to have visible and tangible output within one year.

It’s high time that the practitioners of Islamic Finance pay heed to the fundamentals of Islamic Economics as the foundation of their activities in providing Islamic financial services and products so that both theory and practice move in unison and in equilibrium in order that Islamic banking and finance serve the genuine needs of the ummah.

“This requires policy measures that are not only pro-growth but also will ensure the attainment of equity and the socio-economic progress of all segments in society,” says Professor Mohamed Aslam Haneef, chairman of the Conference, who read what become known as the Kuala Lumpur Declaration on Oct 13, at the end of the three-day Conference.

Explaining on the theme of the Conference which is Rethinking Islamic Economics and Finance: Paving the Way Forward for Inclusive and Sustainable Development, Professor Aslam tells FocusM: “The rethinking theme is in response to the much muted unhappiness among academics and the common man who are increasingly critical of the present day practice of Islamic Banking and Finance (IBF).”

Professor Aslam who’s also IIUM’s Director, Centre for Islamic Economics also poses the question: “Do IFIs (Islamic financial institutions) play any developmental role and are helping to solve the major socio-economic problems of the ummah or just a bank for rich Muslims and corporations?

“For too long, IBF has become an ‘industry’ for the shareholders and moved away from it being a ‘movement’ with an ummatic vision. Yes, they are syariah-compliant but not necessarily ethically rich and concerned,” he sighs, reflecting a sense of disappointment at the way Islamic Economics and Finance have evolved since the inception of the first International Conference on Islamic Economics at Mecca 40 years ago which gave birth to the nascent discipline of Islamic Economics in the first instance, and IBF subsequently.

Among the priorities of the proposed I-FIEFE are:

  • Develop a global database of Islamic economics and finance education, which would cover programmes, curriculum and ‘talent’ development and is to be published as an ‘Islamic Economics and Finance Education’ report with the support of IRTI and other partners;
  • Holding international workshops/seminars and continuous education programmes for university lecturers to improve the standards of teaching and research in Islamic economics and finance, especially in the OIC-Member states; and
  • Conducting and coordinating greater research collaboration and academic/student exchange between member institutions.

The 11th Conference was held under the auspices of the IIUM, co organized with IRTI of the IDB Group, the International Association for Islamic Economics (IAIE) as well as the Ministry of Finance, Malaysia as a strategic partner.

Risk sharing to replace existing risk transfer/shifting system

In his keynote address at the Conference, Professor Abbas Mirakhor of the Malaysia-based International Centre for Education in Islamic Finance (INCEIF) which is dubbed by analysts as the Global University of Islamic Finance, lamented at how a risk transfer or a risk shifting in the context of risk sharing in a debt based system often ends up with the taxpayers assuming the risk without their knowledge.

“Although the 2013 Declaration of the 9th Conference at Istanbul stipulated that the essence of Islamic Economics is risk-sharing, nonetheless a risk sharing arrangement that is the result of a risk transfer taking place without the knowledge of the one who now assumes the transferred risk on why the risk is shifted to him or her, is obviously haram.

“The party that is being subject to a risk transfer must be informed at the beginning, not at the end of the transaction that he is subjected to a risk transfer in order to make the transaction Syariah-compliant,” adds Professor Abbas.

Hearing Professor Abbas, my mind was transported back to the time some 30 years ago when I was among the pioneer batch students of Islamic Economics at the IIUM where I often wondered why my lecturers sanctioned the idea of a loss-offsetting reserve for a theoretical Islamic Bank where in good times, the investors/depositors were not given their maximum rate of return but instead that amount which was more or less equivalent to what an investor would earn in an interest based system.

The excess that was being withheld from the investor was placed in a loss-offsetting reserve so that the theoretical Islamic Bank in bad times can still dish out a rate of return which was more or less the equivalent of the interest rate earned by an investor/depositor in a conventional bank via drawing out funds from the loss-offsetting reserve. And the investors/depositors were not told of this mechanism in advance.

The rate of return by definition is a variable amount whose final value is dependent on the risk undertaken for a given period of time by the depositors/investors. Because of this variability in amount, a distinction is made between an ex-ante rate of return and ex-post rate of return in which the former refers to an estimated as opposed to actual average rate of return over the life of an investment, while the latter refers to a calculation of the actual rate of return over the life of an investment. In cases where there was uncertainty as to the rate of return before the investment was made, one calculates the ex-post rate of return after the completion of the investment to determine how closely the investment matched its estimates.

The rate of interest, on the other hand is a fixed amount that an investor/depositor is always entitled to, regardless of the risk undertaken. Making the rate of return riskless is tantamount to transforming it into an interest rate, for in economics, a riskless rate of return is another name for interest rate.

Granted that the first Islamic bank needed to use interest rate as a shadow rate of return for benchmarking purpose, otherwise its viability would be affected at its pioneering stage, it would be mind boggling that this need for a shadow rate of return based on the movement of interest rate is still justified after 30 years of Islamic banking, and with the mushrooming of Islamic banks the world over.

Continuing this practice goes against the grain of economic theory because in conventional economics, it is for the rate of interest to follow the rate of return instead of the other way round. For instance, when the rates of return are high, people will move their funds out of a debt system like banking to the equity system like the stock exchange, and this in turn will drive up the interest rate to stop the exodus of funds to the equity market. Conversely, when rates of return are falling, people will move their funds out of the equity market to the banking system. This exodus of funds into the banking system in turn will drive down the interest rates.

It is on this basis that Muslim economists are unanimous in declaring that interest rate is an institutional reality rather than an economic necessity! The rate of return, on the other hand, is both an economic necessity and an institutional reality.

No risk, no reward

The above discussion has ramification on the providers of Islamic financial services and products in that they have a duty to inform their clients on the risk profile of their products and services based on the maxims of “no risk, no reward” and “high risk, high reward”.

Risk here refers to the total or partial erosion of the initial capital of their clients while reward refers to the prospect of earning more than an average rate of return by their clients. It is impossible for all financial institutions (FIs) including Islamic ones to guarantee at the same time both the preservation of the original capital, along with earning a more than average rate of return.

This is the point that lay investors seldom realise and thus were easily taken in by the promise of such double guarantees by unscrupulous representatives of FIs, which were often the cause of global financial instability if this subtle “trickery” occurs on a massive scale.

That is why the Singapore’s Monetary Authority (MAS) has made it mandatory on FIs to rate their financial services and products based on the risk profile of their clients in order to educate them on the risky nature of all their products and services.

At one end of the spectrum are products that guarantee the preservation of the initial capital with a modest rate of return for risk-averse investors, while at the other end are the products meant for risk-taker investors that offer a more than average rate of return with no guarantee of preservation of the original capital. Hence, risks are known and shared equitably.


Financial ombudsman scheme may mitigate fatwa-shopping in IBF

THE Ombudsman for Financial Services (OFS), which has commenced operations since October 1, as the operator of the financial ombudsman scheme, may put a damper to the phenomenon of fatwa-shopping in the Islamic Banking and Finance landscape in Malaysia, if the phenomenon indeed exists here.

Bank Negara gave its seal of approval for the operationalization of OFS beginning October 1 in a media statement on Sept 28. Its operationalization comes under the Financial Services Act 2013 and Islamic Financial Services Act 2013 to provide a fair and efficient avenue for financial consumers to resolve disputes against financial service providers.

The phenomenon of fatwa shopping arises because Syariah scholars sit on the Syariah Supervisory Board (SSB) of Islamic Financial Institutions (IFIs) where their decision on the syariah compliance of the Islamic financial products is very crucial to the offering of the products or services by the IFIs. Many of these scholars are highly regarded, with their opinions having the potential to move markets.

Hence, some analysts have raised some concerns that since syariah scholars are generally employed directly by the financial institutions, their independence can be compromised, since bank managers use their influence to gain more acceptable opinions. This has been commonly referred to as “fatwa-shopping” or “Shariah advisory à la carte”.

The issue was first raised in 2009 when Sheikh Muhammad Taqi Usmani of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), a Bahrain-based regulatory institution that sets standards for the global industry, said that 85% of Sukuk, or Islamic bonds, were un-Islamic.

With the operationalization of OFS in Malaysia, this phenomenon can be mitigated as consumers that have issue with the Syariah compliance of an Islamic financial product or service that they have bought may bring it up to the OFS. This is because OFS serves as an independent redress mechanism with minimum formality for financial consumers to resolve disputes with financial service providers.

But as pointed out by Associate Professor Dr Syed Musa from the IIUM’s Institute of Islamic Banking and Finance (IIiBF), the OFS is an alternative to, and not a replacement for legal actions taken in a court of law, and disputes filed must not exceed RM 250,000.

“The key is still the focus on effective Syariah/corporate governance mechanisms, transparency and product disclosure towards customer care and intimacy to mitigate the Syariah non-compliance risk, without unduly inhibiting the innovative spirit of the industry to come out quickly with various range of products to suit the customers’ varied needs,” he adds.

“The availability of this dispute resolution mechanism may also lower the cost of Islamic financial products since they are viewed as relatively costly vis-à-vis conventional financial products, albeit a perceived one, as brought up by one of the speakers in the Conference.”

Dr Syed Musa is referring to the 11th International Conference on Islamic Economics and Finance held in Kuala Lumpur from Oct 11 to 13. The relatively lower cost alluded by him could be the result of the harmonization process in which both the Islamic and conventional financial products come under the ambit of the OFS.

The services of the OFS are offered free of charge to financial consumers. It operates in accordance with the principles of independence, fairness and impartiality, accessibility, accountability, transparency and effectiveness. A retired Federal Court Judge, Tan Sri James Foong has been appointed as its Chairman.