To the depths of desolation
Where did it all go wrong for Datuk Vinod in 1997? According to his reflections, part of the problem was the setting in of what he calls, “the God complex.” It was a time when, in his words, “everyone was telling me I was the best thing since sliced bread... and that everything I touched turned to gold.”
It is important that we bear in mind that he was still a young man at the time when all the accolades started pouring in, or as he called himself, “a 23 - 24 year old kid”. It was definitely a heady experience, being praised to heavens like that, and at such a youthful age, it was just too much.
He told us that the lack of experience caused him to start believing the hype and thus he started doing things that “common sense says you don’t... business experience says you don’t”. Amongst such miscalculated business ventures were East Asia’s largest fruit and vegetable farm, which floundered due to a lack of government support.
The ringgit collapses and the market falls
The 1997 Asian Financial Crisis was an electric shock, which shook the core of the East Asian Boom. Datuk Vinod recollected that at that time, he was hospitalised overseas for health problems and that there was “a situation where the ceiling had collapsed and I am not there. And I have not created the strong foundation and management systems to sustain everything (but) was totally reliant on the partners, who both Tunku and I trusted, and who had talked us into investing.”
Datuk Vinod is a man whose finger is always on the pulse of things. Unfortunately, during the Asian Financial Crisis, he was handicapped by his illness. His inability to be present in the country during that time severely hampered his business. By the time he came back to Malaysia, the bomb had already dropped and it was just a matter of waiting for the fallout. It was in his words, “a disaster”.
And yet, as he recalled, “there was nothing we could have done about it. We had US dollar debt. Now, I’ll give you an example, say we had borrowed a hundred million US dollars but we had taken it in ringgit, which was 245 to 250 million ringgit. But because of the Crisis, we suddenly do not owe just 250 million ringgit but 300 million and then 350 million and this just increased day by day. At one stage, it would have been half a billion but all that would have been given was 250 million. And you had no control over it!”
Another cause of the problems at that time, as identified by Datuk Vinod, was that they were conducting too many businesses, which caused them to be spread wide and thin. And there wasn’t anything anyone could have done. In the areas where he had direct control, things weren’t as bad but there were those without his finger on the pulse and it was in those areas that were the most affected. ‘But at the end of the day, the buck stops with me. It was my responsibility. And whatever roles others played, there’s no denying the mistakes I made. The key is to try and not repeat them,” he insists.
Each article featured in this page have been previously published and will be credited to their respective authors/publications. All other posts are Datuk Vinod's personal essays and may be found in his personal FB page.