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By Jeff Greenwald
Are tax holidays, open immigration for infoworkers, a promise of no Internet censorship and one man's sheer will enough to turn a stretch of Malaysian jungle into a futuristic, fibered, 30-mile-long technopolis?
Kuala Lumpur's skyline bristles with lightning rods. The twin Petronas Towers, rising above the city like conehead cousins of the Chrysler Building, are the highest buildings on earth. Merdeka Square boasts the world's loftiest flagpole (next to the world's biggest open-air television), while Menara Kuala Lumpur - Southeast Asia's tallest communication tower - likewise needles the sky.
Conductive as these spires may be, no eminence in Malaysia sparks more voltage than Prime Minister Dr. Mahathir bin Mohamad. The 71-year-old former physician has been the nation's leader for 16 years, and his record of achievements is astounding. "Dr. M" wanted a first-class campus built in the virgin jungles of the north; 20 months later, Universiti Utara Malaysia was completed. He wanted the world's tallest building in KL, and there it is: not just one, but a pair of 'em. He dreamed up the Proton, a cheap and reliable car that could be built almost entirely in Malaysia; today, Protons jam the highways.
"He's like a cult figure," observes Dinesh Nair, one of the most prominent hackers on Malaysia's infotech scene. "The line you hear is, 'Whatever he sets his mind to, happens.'"
Mahathir is now focused on Vision 2020: a plan to transform Malaysia into a fully developed nation within 23 years. To achieve this, he wants to turn a huge chunk of his country into the planet's most seductive technopark: a lusciously ecofriendly "Multimedia Super Corridor" linking KL with the immense new Kuala Lumpur International Airport (KLIA), 30 miles to the south. Between those poles, on a Singapore-sized swath of land once covered with rubber trees and oil palm plantations, will rise two sister cities: a digital-ready new capital named Putrajaya, and an infotech omphalos called Cyberjaya.
In Malay, Putrajaya literally means "city of the people." Cyberjaya, loosely translated, will be a Xanadu for nerds. The whole, insanely ambitious shebang - known as the MSC - will be knit together with 2.5- to 10 gigabit optical fiber and managed by a paperless government operating under a code of freshly minted cyberlaws.
Mahathir's scheme rests on two pillars. The first is his own awesome chutzpah. Even on the evening news, the guy's moxie shines through. He's a shrewd charmer, intimate but firm. Some may call the MSC a megalomaniacal scheme; if so, the megalomaniac in charge is just the man to pull it off. And there's no one - not even next door, in archrival Singapore - saying he can't.
The second pillar is Mahathir's conviction that, despite his nation's giddy success as a manufacturing center, the industrial competition in Southeast Asia is getting too tough. Investors in industries needing cheap labor are already shifting their money to emerging economies like those in nearby Cambodia and Vietnam. The only way Malaysia can sustain its current rate of economic growth, Mahathir has declared, is by taking a flying leap into the information age.
It's a costly, but clever, strategy. For despite KL's plethora of engineering marvels, one gets the feeling that the new Malaysia is being built with borrowed tools. "Genius," as Edison remarked, "is 1 percent inspiration and 99 percent perspiration." Malaysia's willing to sweat; what it lacks is an ability to innovate. To make this possible, it needs an infusion of the technological know-how possessed by the most developed nations. The MSC, essentially, is a spirit-catcher: a quasimagical device that will draw new life into Malaysia's universities and labs.
Can it fail? Absolutely. Breakdowns in infrastructure and a lack of knowledge workers could derail the project, while the prospect of an informational free-for-all may prove untenable to Malaysia's majority Muslim population. And Mahathir himself, though he talks a good line, has anti-Western sentiments that might rise up to haunt him. He has ranted against homosexuals, claimed that single-parent families foster incest, and banned Schindler's List as Zionist propaganda.
Whether or not one agrees with his views, nobody denies that he gets things done. His run of economic victories has thrilled the popular imagination - and Malaysians are getting hooked on his daredevil style.
It's a very bold move," Khatijah Shah, managing director of Oracle Systems Malaysia, admits of Vision 2020. A gazelle-thin woman with black eyes and cinnamon highlights in her hair, she sits framed by the silvery corncobs of the Petronas Towers. "But if Malaysians don't come up with a quantum-leap strategy of some sort - like the MSC - we'll never get there. I'm not saying there won't be any difficulties," she adds. "There will be. But we should be realistic and say, 'OK, let's see what we can do to overcome them,' versus using them to deter our moving forward."
The grunt work of moving forward is being managed by a group called the Multimedia Development Corporation (MDC) - not to be confused with the MSC, the Multimedia Super Corridor itself. A self-proclaimed "one-stop supershop," the MDC has broad powers to entice multimedia-related companies into the MSC, ensure their success, and bond them together into "smart partnerships." (Note: Everything connected with the MSC is "smart," "super," or "excellent.")
At this point, the corporations on board - including Oracle, Sun, and Japan's NTT - are jockeying for position in one or more of seven "flagship applications": each a distinct vertebrae in the supercorridor's backbone.
Far more difficult to remember than the names of the Seven Dwarfs, these core projects will develop: 1) smart schools; 2) telemedicine; 3) a national smartcard used to access everything from blood type to overdue library fines; 4) a "paperless" electronic government; 5) R&D clusters centered around a new multimedia university; 6) "worldwide manufacturing webs" connecting design, manufacturing, and distribution centers; and 7) borderless marketing centers, the description of which causes spontaneous napping in laboratory rats. The only thing lacking, it would seem, is a world-class carpal tunnel syndrome clinic.
"I'm very excited about what the MSC has in store," Shah declares. "Just the fact that the Malaysian government sits down with technology providers like ourselves and says, 'Let's define the requirements for electronic government.' Previously, a government would define the requirements on its own, with its limited knowledge, and companies would respond. Now they're saying, 'Let's define it together.' That's a very smart move."
It is smart. It's super. And Oracle isn't the only company to think so. By March '97, there were 30-plus applications from companies wishing to participate in the MSC and more than 400 inquiries.
The main reason for this response is the fact that Malaysia is offering companies irresistible incentives: 10-year tax holidays, waived import duties on multimedia equipment, and the ability to bring in as many foreign knowledge workers as they'd like. Mahathir also promises a censorship-free Internet (in pointed contrast to neighboring Singapore) and a business environment free of the endless bureaucratic hassles that make setting up shop in other Asian countries a nightmare.
It's mid-afternoon in Kuala Lumpur: time for the call to prayer. I stand on a street corner, watching pilgrims flow toward Masjid Jamek, an onion shaped, domed mosque located near the junction of rivers that gave Kuala Lumpur, meaning "muddy confluence," its name. This display of religious fervor is tame; come the annual Thaipusam festival, rival Hindu devotees will skewer hooks through their cheeks, tongues, and skin to prove their love of God.
Outside the mosque gates, a vendor sells plastic bowls of ais kacang, a cold drink made with shaved ice, sweetened milk, kidney beans, and green jelly noodles. I down a bowl of this slimy soup, steeling myself for the question that must be asked.
"So is Mahathir nuts, or is this a great idea?"
To my relief, M. Sivarajasingam, general manager of Boustead Information Technology, simply laughs. "Mahathir is a visionary," he says. "But for the MSC to succeed, a lot of factors must come together."
Boustead is a local company, a small fish in the huge aquarium that Mahathir is planning. If it wants in on the MSC, it'll probably have to partner up with one of the big boys. Being local, though, Sivarajasingam has a realistic perspective on the obstacles confronting the scheme.
The most basic of these, he says, are Malaysia's lack of a robust telecom infrastructure or reliable power grid. But this is a mere detail; the local grids are much better than the mess you'll find in, say, India. A thornier problem is Malaysia's meager workforce - specifically, its lack of so called knowledge workers to run this new economy. In a recent study of 49 countries, Malaysia placed only 28th in computer literacy.
"When you're talking about creating an electronic, 'paperless' government, you're talking about thousands of people," Sivarajasingam notes. "All of them must be trained; all of them must be taught to do things in the right way. That is going to be a really long haul. It's not that easy."
Mahathir's plan is like a Chinese puzzle; the fit of every piece depends on the movement of others. For the whole thing to come together, all seven flagship applications - not to mention Putrajaya, Cyberjaya, and KLIA - must be up and running by 2000. The infrastructure will cost the country a big piece of its hoarded manufacturing profits: 20 billion Malaysian ringgit (US$8 billion) for Putrajaya alone. Total cost for the project will be more than M$50 billion (US$20 billion).
The payoff, Mahathir insists, will be the golden apple of technology transfer: a prize that will eventually allow Malaysia to enter the IT playing field on equal footing with the United States and Japan. But this, Sivarajasingam claims, is the biggest question mark of all. Big companies will flock to the MSC for its hefty tax breaks, bringing in any number of highly trained foreign workers - but where is the incentive to share technology? Though the MSC charter asks companies to show how they will meet Mahathir's goal, nothing compels them to do so.
"They might take local people to help with some basic things, but the technology is still going to be in their hands," Sivarajasingam says. "What are we going to do then?"
Malaysia is divided into two distinct land masses. Peninsular Malaysia, site of the capital and the future MSC, lies between Thailand and tiny Singapore. East Malaysia sits on part of a huge island 400 miles away, across the South China Sea. The total population of this country (which covers roughly the surface area of New Mexico) is about 20 million - and most of them seem to be stuck in traffic as I navigate toward a meeting with Ramesh Nava, Sun Microsystems' point man in Malaysia.
Dark-skinned with boyishly handsome features, Nava was the architect of the company's ground-floor entrance into the MSC. "There is depth and content in the plan," he feels. "It's visionary enough without being too Star Trek or Star Wars. It's doable. You add a doable, visionary plan to the Mahathir capability, and you've got a good formula. This is going to happen."
"What makes you so sure?" Nava's socks catch my eye; they're neon green.
He nods gamely, the numbers at his fingertips. "Here is a Third World country with a track record of 7 percent or 8 percent GDP growth per year, for seven or eight years. No slowdown, no glitch. Which means they're pretty good at execution. And here's a country with a multiracial population that's descended from trading nations. People who trade are good at business, which means Sun could come up with some good partners. We're already seeing companies from Singapore, Hong Kong, and even India interested in the MSC - and many of them have approached Sun."
Sun Microsystems is just the kind of high-profile act that Mahathir wants in his cabaret. While Boustead's local infotech company occupies a warren of basement-level offices, Sun holds court on the 18th floor of the Menara Lion building. From this aerie, it has helped launch proposals for three of the MSC's flagship applications: electronic government, smart schools, and telemedicine. But its first move will be to set up a "Competency Center" to assist Malaysian companies in building Java-based technologies or products. This, Nava insists, is exactly what the Malaysian government wants.
"The Competency Center is designed exactly for technology transfer. For example: if a Malaysian IT company says that it wants to produce a piece of software for work flow in hospitals, it can come to the center. We can help them incubate the project, which would take probably five times longer if they sat in their own office and got support from us over email."
However Nava looks at it, signing on with the MSC was sound strategy for Sun. "I didn't have to convince the company to perform any unnatural acts," he says. "There's no legacy here. It's all being built from the ground up. And some of the world's best players are involved."
Indeed they are. In June 1996, Bill Gates announced his intention to set up Microsoft's Southeast Asian regional headquarters in Malaysia, but much of the action took place earlier this year, during Mahathir's whirlwind tour of the United States. His San Francisco Bay area pitch for the MSC, conducted at Stanford University in January, attracted nearly two dozen of the highest rollers in the business, including Netscape's Jim Barksdale, Scott McNealy of Sun, and Oracle's Larry Ellison.
"Mahathir can hold his own," Nava nods. "He surfs the Net. He knows what will run on a browser and what won't. He's pretty savvy."
"Don't you think it's strange," I remark, "that the same guy who banned Schindler's List is now guaranteeing a censorship-free Internet?"
"That's pragmatism," Nava states. "That's being a smart politician. If you asked him, he would probably say, 'We set policy based on the times.' And it's good that he can change. Isn't it?"
Nava is right about the cultural mix. The first thing one notices in Kuala Lumpur is its polyglot blend of Indian, Chinese, Western, and Malay. Centuries of intermingling have turned the city into a crucible, with a riot of foods and some of the gaudiest bazaars in Asia. Koranic prayers float over sidewalk racks sagging with Indian silks; you can wander through a Chinese market, ankle-deep in fish guts, and emerge into the shadow of a gleaming purple skyscraper.
There have been troubles - racial tensions over hiring quotas erupted in riots in 1970 - but Malaysia has since enjoyed a quarter-century of peaceful coexistence. That, along with a decade of runaway prosperity, have given the country a lot of self-confidence.
"The expression we have is 'Malaysia boleh,'" says Othman Yeop Abdullah, executive chair of the MDC. "It means, 'Malaysia can do it.' We set our minds, our spirit to it."
A soft-spoken man with wire-framed glasses, Othman is no stranger to Mahathir's visions. His previous position was vice chancellor of Universiti Utara Malaysia, which rose like a miracle from the chlorophyll of Kedah state. Now he's overseeing the powerful administrative engine that will draw companies like Microsoft into the corridor and see that their every wish is fulfilled.
"One strength of the Malaysian government," Othman says, "is that if there is a need to change a law to ensure the growth of electronic commerce in the corridor, that can be speedily undertaken." In other words, what the prime minister wants, the prime minister gets.
Unlike its once and future competitors in infotech - from semi-stable Thailand to anal-retentive Singapore - Malaysia has decided to pull out the stops. Even the ironclad bumiputra rules, which mandate that half of the workers employed on any government-related job be Malays, are being waived for MSC participants.
Mahathir's government is also drafting a slate of new laws that may prove to be the Magna Carta of cybercommerce. Along with protecting intellectual property and providing severe penalties for things like digital signature fraud, they address issues of virtual etiquette: a doctor, for example, need no longer be in the same room as the patient.
Mahathir's breathless pace is alarming to some of his neighbors, but the stakes are clear. In the compact arena of Southeast Asia, the MSC is a national gamble on par with the Space Race. Whoever wins regional control of the IT market will have a role to play in the world market; the losers will assemble sneakers.
An even better way to look at it is to imagine the regional countries as college basketball teams. Singapore, Indonesia, Thailand, Vietnam - they're all shooting for the championship, and the competition is fierce. Mahathir has coached his players into the spotlight, and their star continues to rise. No wonder they worship him: he's the Rick Pitino of prime ministers.
Mahathir's bodacious plan has only turned up the heat between Malaysia and its southern neighbor. Singapore leads the world in science training, ranks third in IT, and has the second-best technological infrastructure on earth. Nonetheless, the tireless hype surrounding the MSC - which peaked in January when Microsoft placed an ad in Singapore's Straits Times luring workers north - has made Singapore edgy.
"At the moment there's a great deal of paranoia on the part of Singapore," Othman admits. "In the past, Singapore considered itself the leader in the service industry as well as in information technology. It's a matter of getting adjusted, to some degree, to the new kid on the block."
With his gold earring and sparse black beard, Dinesh Nair looks sort of like a Malay beatnik. He picks me up in his '89 Proton - "the last of the shoddy ones" - for an expedition into the vast land tract of the future MSC. Our goal is to check out the new airport and find Putrajaya, the future capital itself. Mahathir has vowed to move his administration there by September 1998, so construction must be well under way.
Dinesh made local headlines in 1996, when he became the best-known hacker in Malaysia. Raymond Cheng, CEO of Asia Connect, had boasted in an interview that the security on his ISP was impossible to crack; he'd give M$50,000 (US$20,000) to anyone who could penetrate it. Two weeks later, Dinesh and a friend hacked into Cheng's private mailbox and claimed the prize. Dinesh is now the vice president of technology at Future Communications, a KL-based company specializing in Internet and cybersecurity projects.
"Dr. M," he summarizes, "will drag Malaysians kicking and screaming into the information age. He's pushing these people into the deep end with a rope, and saying, 'In 10 minutes I'm going to snip the rope, and you're on your own.'"
A few miles south of KL, the landscape turns primitive. The hills along the highway are covered with vegetation. Most of this area, Dinesh says, used to be federally subsidized rubber tree and oil palm plantations. When the MSC was declared, the government bought the land back at inflated prices. "It wasn't uncommon," says Dinesh, "to read about struggling farmers becoming instant millionaires."
As we pass the Fiestaware-yellow dishes of the All Asia Broadcast Center, I grill Dinesh about technology transfer. He's dubious on two counts. The obvious issue is whether foreign companies really will pass anything over, but his second observation surprises me. "It's the mind-set of the Malaysians themselves," Dinesh declares. "If Mahathir succeeds in changing that, I'll be very happy."
Dinesh bases his argument on the same factor that Sun's Nava saw as an asset: Malaysia's long history as a trading nation. Traders, notes Dinesh, typically buy technology from one place, add a little value, and resell it. They aren't focused on R&D. "People here haven't moved their mind sets toward analyzing problems," he says. "You can train people to pick up a manual, figure out what it says, and solve a problem. But when you're faced with a problem that is totally new, that's when creativity comes in."
When I ask if projects like Sun's Competency Center will help, he shrugs. Sun is here to sell Sun boxes, he says; it won't matter to them whether the boxes are used to render animation or to sit as doorstops. "It may be sincere in wanting to help build the MSC; I don't doubt that. But even if it's sincere in wanting to give, many Malaysians are not ready to receive."
"What's the solution, then?"
"What you're really transferring is attitude," Dinesh responds. "Initially, we will have to rely a lot on the outside. But Mahathir hopes that when Malaysians are employed by these companies, working alongside foreign experts, some of their innovation will rub off. It might take three years, it might take ten - but eventually we will pick up that lateral thinking. Then we're in a position to start coming up with something like Java ourselves."
An hour's drive brings us to the perimeter of KLIA. The southern locus of the MSC, it's scheduled to open this September. The site is awesome, a concrete and asphalt desert that recalls the barren vistas in Lawrence of Arabia. Skeletal passenger lounges hover in the haze like mirages, and the silvery control tower pokes above billowing dust clouds. We leap from the car, handkerchiefs clamped over our mouths, then leave the toxic miasma in a blur.
We make our way back toward Kuala Lumpur on service roads, trying to find either jaya: Cyber or Putra. These cities-in-progress are not on any map, and our attempts to locate them prove fruitless. By four o'clock we give up. On our way to the highway we miss a right and end up on a twisty, one-lane road leading back into the bush. Unable to turn around, we drive on - until Dinesh abruptly hits the brakes. On the right shoulder looms a large, professionally lettered sign: Selamat Datang Ke Putrajaya (Welcome to Putrajaya).
"Holy cow," I say. "This is it?"
Dinesh pulls over just past the sign. Except for the road itself, there is no sign of civilization. The landscape is covered with oil palms, the deposed rulers of Malaysia's past economy. This was once a plantation, but it's gone to seed; a muddy river cuts through the dense foliage, and vivid blue kingfishers dart between branches. It feels like Jurassic Park; when we leave the car to look around I step warily into the jungle, half expecting a pod of Velociraptors to turn us into steak tartare. There are no dinosaurs, Dinesh assures me, but there are cobras; in days gone by they would drop out of the oil palms and onto the heads of unsuspecting farmers. I retreat to the car.
Forging ahead, we finally come across some activity. A seemingly endless train of bulldozers, loaded with sand and debris, creeps along a fresh dirt track. Through the emphysemic haze, I spy another sign: a colorful billboard portraying what this sandbox will look like in 18 months. Domes and spires gleam against an azure sky, and bright jets of water dance above shady walkways.
"No way," I say, shaking my head. "No fucking way."
"Don't be surprised," Dinesh laughs. "I think it will happen."
My final night in KL I round up Dinesh, Sivarajasingam, and a host of other locals. We end up in a bar called Wall Street. It has a neat gimmick: the market values of shots and specialty drinks flash on a bank of suspended video monitors, registering minute fluctuations in the price. I order an iced vodka for 12.54 ringgit, intrigued to see the price drop a quarter share just as I sign my Visa slip.
The theory behind bringing these guys here is that, with a few drinks under their belts, they'll dish out some dirt on Mahathir and the MSC. All that happens, though, is that I get stinking drunk and spend the evening recording, illegibly, a litany of hesitant doubts.
The most incendiary comment anyone makes - and all present agree - is that technology transfer is a farce. Mahathir has made too many concessions, particularly the clause allowing foreign companies to bring in unlimited numbers of their own knowledge workers. The only thing Malaysia can realistically expect from leading-edge companies joining the MSC is a trickle-down (or, as Dinesh put it, "rub-off") effect. Other misgivings revolve around the city's paralyzing traffic gridlock and power supply problems. The corridor is meant to be webbed by new highways, light-rail lines, and an electric monorail, but the claim that everything will be ready by next year is hard to swallow.
When the last beer nuts have disappeared, though, the verdict is clear: Mahathir knows best.
"Industrialization has taken us this far," says Sivarajasingam, sweeping his arm to embrace Kuala Lumpur's pointy skyline. "Now Mahathir has taken a stand and said, 'The MSC is what's going to take us to the year 2020.' It's a challenge. If it fails, at least we have tried. If we don't try, we won't know."