Taken from http://daimzainuddin.com/TunDaimProfile.htm
In 1997 when the Asian crisis swept through Asia leaving behind
devastated economics in its wake, Daim Zainuddin was recalled to public
service.
Born April 29,1938 in Alor Setar, the capital of Kedah, Daim bin
Zainuddin is the youngest of thirteen siblings.
His father was a clerk in the Kedah State Service and his mother a
homemaker. Daim received his early
education at the Malay Primary School in Seberang Perak, Alor Setar and then
advanced to the Special Malay Class at the Sultan Abdul Hamid School, which was
an English–medium school.
Being a youth of the 40’s, during a period when the British
Colonial Policy encouraged Malays to attend Malay schools, when Malay parents
worried about the possible influence of an English education on their
children’s religious faith and cultural identity, Daim and his parents
were able to transcend these limitations.
In fact, his broad-minded parents enrolled all their children at
English–medium schools as they did not want their children to become
“better farmers and fishermen”.
However, Daim was very much an absentee student. He had worked out a strategic studying method
whereby he would only need to focus on subjects that he would need to pass to
advance to the next class and that required little effort - English and Malay
languages and Mathematics. He devoted
his free time to pursuing his main interest which was sports and more
sports.
Career-wise, Daim would have
ended up as a teacher except that due to some miscommunication he had been
totally unaware that his name was on the list of successful candidates for
Brinsford College, England, a teacher training college.
Throughout his youth, he was very much encouraged by a mother who wanted
him to further his studies and a father who wanted him to become a lawyer. His
mother sold some land to raise money for him to study law in England. Realizing
that “time is money”, the former absentee student became a diligent
and disciplined scholar in law who after eighteen months at Lincoln’s Inn
London and at the youthful age of 21, was called to the English Bar in
1959. It was also during his student
days in London that he developed his voracious appetite for reading which till
today is his favourite pastime.
Upon his return to Malaysia, he started reading in the chambers of
Pillai & Co. and later, the chambers of Shearn Delamore which was then the
largest law firm in Kuala Lumpur. In 1961, he decided to move and work in Kota
Baru, Kelantan under the tutelage of Encik Wan Mustaffa who was legal adviser
to the Pan Malaysian Islamic Party (PMIP) which later became known as Parti Se
Islam Malaysia (PAS). After his stint in
Kota Baru, he joined the Malaysian Civil Service as a Magistrate, then became
the President of the Sessions Court in Johor and subsequently became Deputy
Public Prosecutor in Ipoh, Perak. He
resigned from the service in 1965, returned to Kuala Lumpur and joined the law
firm of Allen & Gledhill for the next three years till his resignation in
1968 to start his own law practice of Daim & Gamany. In 1969, however, he
decided to venture into business.
His first business venture was in salt production, partly because it
seemed easy and partly because his partner’s feng shui indicated that he
should work with water. They went to Thailand, Taiwan and Japan to study salt
production, weather forecast, soil condition and location. During the start-up
they proceeded to clear 600 acres of the coastal land of Kuala Selangor, but
because the rain came unseasonably early just when the salt had began to
crystallize, they were almost bankrupted by it.
His next venture was in plastics production. After he obtained a license however, another
two licenses were issued and this instigated early and keen competition to
Daim’s fledgling company.
Furthermore, the workers were incited to strike and eventually the
venture proved to be another bankrupting business. Fortunately, his other downstream ventures
which included the plastic packaging company, Daibochi and the snack food
factory, Sedap Food flourished and were later listed on the Kuala Lumpur Stock
Exchange. He also invested in the
Ports’ downstream business with stevedoring, forwarding and low-loader
licenses and had set up a manufacturing plant making steel and iron products
like manhole covers and telephone posts. The success of these ventures helped
towards offsetting loans and borrowings of the failed venture.
Daim’s great break was in 1971, when he decided to venture into
land and property development. Together
with two other partners, he formed a company, Syarikat Maluri Sdn Bhd of which
he held a 60% majority control. The Company bought and developed Taman Maluri,
Cheras and Daim became the first full-fledged Malay property developer in Kuala
Lumpur. Having ventured into a
predominantly Chinese sector, he might have expected to encounter
insurmountable problems, but he did not. Why? Firstly, he did his calculations
meticulously, paying great attention to details and had an even keener eye on
the bottom line and secondly, he paid his contractors in a timely manner like
any other good paymaster, and furthermore he was hands-on. Thus, he was able to overcome earlier
skepticism especially from the non-Malay buyers about Malays being able to run
property development companies successfully.
After gaining a foothold in the property business, he began to look for
other challenges to pursue and to prove that a Malaysian of Malay ethnicity
could succeed in other fields. At the same time, other corporate and political
stars were rising and Daim wanted to be “the Malay to do it” and
so, he forged ahead and bought a 30% equity interest in United Estates Project
(UEP) now known as Sime Darby–UEP (developer of the popular ‘Subang
Jaya’ township) and went on picking up stakes in the share market, mostly
strategic rather than controlling stakes.
He was willing to take risks but also saw opportunities before
others. When President Mitterrand of
France came into power and decided to nationalize all French banks, Daim saw an
opportunity whilst others were grumbling about the new socialist policies. He knew that Malaysian banking regulations
did not allow for government-owned banks to operate in Malaysia and therefore
knew that Bank Indo-Suez will either have to close its operations in Malaysia
or be sold-off. He wrote a
‘cold-call’ letter to the Chairman/President of the Bank
registering his interest in the event that they would want to sell. Of course rather than closing down the Bank
they decided to sell to Daim and in 1981 he became the owner of Indo-Suez later
re-named the Malaysian-French Bank.
Later when United Malayan Banking Corporation (then the 2nd largest bank
in Malaysia) became available, he exchanged his majority stake in
Malaysian-French Bank for a smaller stake in this larger bank.
However he had to dispose of his stake in 1984 when he was appointed
Minister of Finance. He never lost his
love for the banking industry and after he retired he started investing in
small banks overseas in Europe and Africa.
As the business expanded, the banks needed to be organized under a
bigger parent bank and he therefore acquired Hock Hua Bank (which he renamed
International Bank of Malaysia Berhad) which was one of the smallest banks in
Malaysia. Again he had to dispose of his
stake when he was reappointed Minister of Finance in 1998. After his second retirement he is now again
actively involved in the banking industry.
Today his business interests
spread far and wide both in terms of the diverse range as well as their
geographical locations. The ICB Banking Group began with the issuance of a
license to operate a bank in Prague, the capital of the Czech Republic in 1993,
to its presence now in IC Bank Rt.(Hungary), International Commercial Bank Sh.A
(Albania), International Commercial Bank Limited (Ghana), International Commercial
Bank S.A (Guinea), ICB-Banco Internacional de Comercio SARL (Tanzania),
International Bank of Malaysia (T) Limited (Mozambique) and International
Commercial Bank (Sierra Leone) Limited – Sierra Leone.
ICB also acquired a 20% stake in Bank Internasional Indonesia through
Sorak Financial Holdings Ltd and a 58% direct stake in Bank Bumiputera
Indonesia. The Group has plans to acquire banks in other countries as well.
Apart from business, politics have always interested Daim. His earliest
exposure was as a student in London whereby though not actively involved in
politics, he shared his fellow students interests in the political issues of
the day particularly independence and post-independence implications on the
socio–economic and religious mosaic of pluralistic Malaysia.
His first encounter with real politics albeit covertly was when in 1966,
as a lawyer with Allen & Gledhill, the firm was appointed by the Federal
Government of Malaysia to act for the Governor of Sarawak in a case against the
Chief Minister of that State. Back in
Kuala Lumpur, Daim was asked to attend a Cabinet meeting whereat he briefed the
Cabinet members of the political situation in Sarawak and impressed upon the
Cabinet the need for emergency to be declared to avert a worsening of the
situation caused by the demonstrations against the Chief Minister’s
minority government. Emergency was declared.
However, the security risk persisted and the Governor as advised by the
central government suspended the Standing Orders of the House and called for a
meeting of the Assembly using emergency powers. Daim assisted in drafting the
statement of the Governor that the Assembly was to debate; the Assembly met,
the Chief Minister’s government was voted out of office. Impressed by his
legal skills and political knowledge, the Prime Minister offered Daim a seat in
Sungai Petani in the 1974 general elections but Daim declined, choosing instead
to establish his credentials in business.
Come 1977, Daim decided that he was financially comfortable enough to
retire. His retirement plan then was to go back to school and so he enrolled at
University of California Berkeley to pursue a course in Urban Planning. At
around the same time, he enjoyed a close rapport with the then Deputy Prime
Minister Datuk Seri Mahathir Mohammed.
In 1978, Daim met Mahathir in Los Angeles and San Francisco, when
Mahathir urged Daim to return to Malaysia and contest in the general election
that year. At the same time, Daim was also offered the Chairmanship of the
Urban Development Authority (UDA) by the Public Enterprises Minister. Daim was
not interested in taking up the Chairmanship of UDA which he deemed too big and
widespread, too bureaucratic and doing too many things at the same time.
Instead he suggested that UDA should form a holding company and transfer all
its commercial property and commercial assets to it; only then would be agree
to manage it. Hence, Peremba was established and Daim became its
Non–Executive Chairman with a team of young and bright hand–picked
officers assisting him. While not many could take his punishing rigours and
demands of work and discipline, those who did went on to become successful
entrepreneurs and notable amongst these were Tan Sri Wan Azmi Bin Wan Hamzah,
Tan Sri Abdul Halim Bin Saad, and Tan Sri Samsuddin Bin Abu Hassan. In 1980,
Daim was informed that the Prime Minister Hussein Onn had appointed him as
Senator in the Upper House of Parliment.
When Mahathir became Prime Minister in 1981, he sent Daim on a number of
missions. The first was to the United States of America (USA) to deal with the
problem posed by the USA’s General Services Administration (GSA) tin
stockpile releases which caused the price of tin to tumble, thus adversely affecting
the Malaysian tin industry, it being a major producer of tin. Knowing that the
tin miners’ hardship would not move the Americans but that the communist
threat would, Daim decided to take on this hard line in his negotiations with
them. It worked and the GSA agreed to limit their stockpile releases to 3,000
tonnes a year for three years.
In 1981, the Government of
Malaysia announced the adoption of the ‘Buy British last’ policy
which actually was a culmination of a series of problems with the United
Kingdom (UK). Prevalent was a new spirit of Malaysian nationalism which was
manifested in the acquisition of Guthrie Estate by Permodalan Nasional Berhad,
the Government–owned national equity corporation; the return of Seri
Carcosa (premises which had been given to the British by Tunku Abdul Rahman
Putra Al–Haj, Malaysia’s first Prime Minister;) and the steep hike
in fees of British Universities. To this day, very few Malaysians are aware
that Daim was instrumental in working behind the scenes to resolve these issues
and restore good relations with the British.
However, the event that truly launched Daim’s political career was
the day before nominations for the 1982 General Elections, when Mahathir rang
Daim to say that he was to contest the Kuala Muda Parliamentary seat. Within
the short span of the next two years, his rise in politics was meteoric as he
was appointed the Minister of Finance in 1984. At that same time the burgeoning
economy kept up its momentum despite the high rate of borrowing and spending to
keep the economy healthy. The full impact of the world recession on Malaysia
was only felt in 1985. Internally too, there were many abuses involving the
financial institutions brought about by lack of proper supervision and control.
By the time he took over, Daim could not avert the scandals, crisis and
failures. However, Daim set about implementing a strict code of monetary and
financial management to prevent the disease from becoming terminal for the
whole economy.
He stopped the practice of borrowing to beef up funds for spending, he
curtailed expenditure to suit income, he slashed the allocation for the public
sector – upsetting many quarters. In the years 1987, 1988 and 1989,
Malaysia paid off about RM6.8 billion of her foreign debts which was earlier than
scheduled, a record repayment for developing nations. Interestingly, the Far
Eastern Economic Review which had made dire predictions about Malaysia’s
economy in 1986, admitted in its issue of September 1, 1988 that Daim’s
effective management style had contributed positively and tremendously to
Malaysia’s economic recovery.
Daim resigned as Finance Minister in March 1991, and the news caused a
stir both in Malaysia and abroad because it was not in the Malaysian culture to
resign from a high office. Therefore,
when it happened there was a great deal of speculation as to why, and of course
the most prominent was that which cited the irreconcilable differences with the
Prime Minister, Mahathir Mohammed. For Daim, the reason was that he had
accomplished his tasks – reorganized and improved the country’s
financial position. Further, the Prime
Minister reiterated by saying that “Daim had agreed to take the post on
condition that he stay only to help reorganize and improve the country’s
financial position. He said he had
fulfilled this task and it was time I let him go.” In accepting his resignation, the Prime
Minister also welcomed his readiness to contribute his ideas to the nation. To
crown it all, the Prime Minister recommended Daim for the “Tun”
title – the highest honour of the land. And so on June 5, 1991, the Yang
Dipertuan Agong Sultan Azlan Shah conferred on Daim the Seri Setia Mahkota
award, which carries the title ‘Tun”.
Prior to his resignation, in 1991, Daim’s contribution was
succinctly summed up as thus: “Despite having much of his tenure clouded
in controversy, the outgoing Finance Minister has nonetheless earned the
reputation as one of the country’s ablest economic architects, having
steered Malaysia through recession into four straight years of high
growth.” In another article, “Daim exits office having earned the
distinction of being a hard–driving technocrat, who resisted pressure by
rival ministers who wanted to alter fiscal policy for political expediency
….”
It was also recognized that during his tenure as the Finance Minister,
Daim had implemented four broad strategic structural reforms during the 1986 to
1991 period namely the mobilization of the private sector, active external
policies, the supportive role of the private sector and the rehabilitation of
the public enterprises. To this day, the
tenets of his economic policies are held in high esteem and are continually
pursued to either jump start or sustain the Malaysian economy.
Perhaps the greatest accolade was that by the late Tan Sri Zain Azraai,
the Secretary–General of the Finance Ministry, who said: “He is an
extraordinary man, a firm man, who came quietly to take over the Finance
Ministry, did a splendid job, then left quietly.”
Although technically out of the Government, Daim was still perceived as
a man to be reckoned with – an entity greater than the sum of his overt
responsibilities when he was appointed Economic Advisor to the Government,
Chairman of the Northern Growth Triangle, the Labuan Development Authority and
the Langkawi development Authority and also the Treasurer of the United Malays
National Organization (UMNO), the leading party in Malaysia’s ruling
coalition, Barisan Nasional (National Front). He was also Malaysia’s representative to the East
Asean Growth Area (EAGA).
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