Here is why.

PART I: ON SCIENTIFIC EVIDENCE

Scientific evidence seems to become the 'template answer' for most if not all of the other Barisan Nasional leaders when asked about Lynas issue. I wonder if they really understand what it meant by scientific evidence in safety and health impact context. Let me 'curi tulang' a bit and use the definition of scientific evidence from the Wikipedia (as it is suffice to give readers a general idea):

" Scientific evidence is evidence which serves to either support or counter a scientific theory or hypothesis. Such evidence is expected to be empirical evidence and in accordance with scientific method......the strength of scientific evidence is generally based on the results of statistical analysis and the strength of scientific controls."

In Lynas context, when we need to prove scientifically that Lynas is safe or unsafe (hypothesis), there should be a statistical analysis on the historical safety records of rare earth plants that use the same technology and raw materials, controlling/weighting the variables such as socio-political, regulatory, geological etc.

In proving safety or health impact, scientific evidence should be based on the statistical analysis of the historical safety data and NOT on what the scientists or engineers say about the technology of the process involved.

For example, when World Health Organization studied whether telecommunication towers will increase the likelihood of cancers in the neighborhood, it based its justification from a large number of researches that statistically analyze the correlation between telecommunication towers and cancer cases in the neighborhood (the hypothesis was proved false). That is what we call safety and health impact scientific evidence and it is definitely far from what Najib and his team have in mind when they shouted confidently scientific evidence.

So, shall we go ahead with Lynas issues? It's a million dollar question. Let's have a look.

PART II: GO-NO GO????

PART II (a): GO situation

The worst case scenario for Lynas operation is the internal exposure due to high-level inhalation of air-borne radioactive dust resulting from uncontrolled dust level or the ingestion of contaminated ground water resulting from leakages of waste storage. Internal exposure of alpha-emitting radionuclides can be extremely harmful and may cause lives depending on the magnitude of the incidents.

However, these scenarios are just risks, they may or may not happen.

Let's now look at Lynas case like any other investment, that is, to see whether the monetary return justifies the risk. The plant construction is RM 2.5 billion. It is also reported that the plant will bring positive multiplier effects to the Malaysian economy (resulting from employment, company and its employees expenditure, utilities, support services such as transport and logistics, banking, insurance etc as well as the tax revenue), Lynas total direct and indirect contributions to the Malaysian economy over the first 15 years is estimated to be RM 6.04 billion.

For simplicity purpose, let's overestimated that all the capital investment is absorbed by Malaysian economy, i.e to hire local contractors and buy materials locally. Also, let's ignore the fact that the above economic contribution estimation took into account the tax revenue (Lynas actually obtained 12 years of tax exemptions, who knows why). Therefore, at the very maximum, Lynas will bring about RM 8.54 billion over the next 15 years to Malaysian economy (RM 2.5 billion + RM 6.04 billion) . If we extrapolate to 20 years of LAMP operation as expected, it will bring be about RM 10.55 billion to Malaysian economy (RM 2.5 billion + RM 6.04 billion x 20/15).

Just to put you into perspective, due to inefficiency, about RM 45 billion of PTPTN loan approved can no longer be traced for collection; due to corruption and other illegal practices, the country suffered about RM 850 billion of lost in illicit money.

So are we going to take the risk and 300 years of social liability for RM 10.55 billion to Malaysian economy?

For me, the answer is crystal clear.

PART II (b): NO-GO Situation

I do not want the readers to be ignorant about what is at stake if we stop Lynas from operating at this point of time - when the contract is signed, the plant is ready and the market is waiting eagerly. It is an irreversible situation and will cost us a fortune to reverse the situation, all thanks to the reckless decision by the BN government.

Firstly, we may have to compensate for Lynas lost depending on the terms and conditions in the contract signed between Lynas and the government (we do not know the amount yet, it is still confidential now).

Secondly, we'll most likely suffer lost of reputation in the eyes of foreign investors as a breach of contract by the Malaysian government will create credibility issues. This is especially true for Lynas case because the whole rare earth industry is waiting for Lynas and Molycorp production to support the heightened global demand of rare earth elements due to the decreasing supply from China. Lynas was expected to produce about 20,000 metric tons (mt) of the estimated 45,000 to 70,000 mt non-China output needed to support the global demand. This accounts for 25-45% of the non-China output. Therefore stopping Lynas is not only a local issue, it can be potentially a huge news in international business. Whether or not this news will create huge negative impact on our foreign direct investment is yet to know.

Part II (c): So, GO/NO-GO?

We are now facing with a question of whether we'll sacrifice our short-term gains for long-term benefits.

If we are looking at long term, I personally think that the "No-Go" situation is less costly the the "Go" situation. This is especially true if Pakatan Rakyat capture Putrajaya in the next general election (sorry, a bit of propaganda here but I am sincere in saying this). When there is a more prudent public finance with less leakages as well as a more competent, accountable and transparent government, we'll earn back (or save) the compensation needed to pay-off Lynas according to the contract. (Of course, I am hoping that we don't need to pay a single cent for that but we'll not know until we see the contract). Through time, we'll also eventually prove to the foreign investors that Malaysia is a good place to invest and Lynas case is just a one-off situation.

So, "No-Go" for me, what about you?

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This article is summarised from 2 more detailed articles from:
1. http://www.yeobeeyin.com/…/lynas-part-i-what-is-scientific-…
2. http://www.yeobeeyin.com/2012/12/lynas-part-ii-gono-go.html