IN THE reckoning of veteran economic journalist and blogger Datuk A. Kadir Jasin, the 166 days or five-and-a half-months in power would be long enough a time frame for Malaysia’s 10th Prime Minister (PMX) to dole out certain short- and medium-term economic reforms.
These include the capital market, the exchange rates and the ranking by local and international rating agencies but thus far Kadir observed that investors – foreign and domestic – have yet to have confidence in the leadership and policies of the unity government.
“The PM sings like a canary when talking about governance,” penned the former Bersatu supreme council member who has declared himself to be a Pakatan Harapan (PH) supporter in recent times.
“But it’s hard to sell Malaysia to foreign investors when a very senior politician who is facing corruption charges is appointed to one of the highest posts in the government, and with politicians made chairmen of key public agencies.”
As evidence to his claim, Kadir said the reaction of the capital market as represented by the Bursa Malaysia’s FBM KLCI index has been lukewarm. In fact, the benchmark stock index has declined from 1,501.88 points on Nov 24 – the day Anwar was sworn in – to 1,433.74 or a fall of 68.14 points on May 8.
According to published data, Kadir shared that monthly turnover improved from RM45.88 bil in February 2023 to RM50.77 bil in March 2023 but still lower than the all-time high of RM136.92 bil achieved in August 2020.
Moreover, foreign holdings in the equity market has not improved. It is about 20% by end-March as against 22.3% in December 2019.
“The ringgit too isn’t sterling. At best it has been moribund,’ remarked Kadir. “It was traded at RM4.57 to a US dollar on Nov 24, 2022 and strengthen to about 4.25 in February 2023 but back down to 4.43 on May 8. The ringgit was strongest in May 2018 at RM3.97 when the PH (Pakatan Harapan) took over rein.”
Although the government welcomed Fitch Rating’s affirmation of Malaysia’s sovereign credit ratings at BBB+ with a “stable” outlook for 2023 in February, Kadir deemed that “it shouldn’t have been a reason to celebrate”.
“That was the very same rating that Fitch gave us on Dec 4 2020 when we were in the midst of the COVID-19 pandemic and lockdown,” he recalled. “Then last month, the government welcomed Moody’s Investors Service affirmation of Malaysia’s sovereign credit ratings of A3 with ‘stable’ outlook. But that was similar to Moody’s rating back in January 2016.”
Judging from the outcome that he has listed down, Kadir suggested that “Anwar has to resist the temptation to play Father Christmas with his populist handouts and promises”.
“His firm stand on no further EPF (Employees Provident Fund) withdrawal is applauded but he must also understand that Bank Negara Malaysia’s (BNM) interest rate policy could be burdensome to general borrowers,” he reminded.
“He (Anwar) should use his showmanship to motivate the people to work harder and be more self-reliant. Already the World Bank had, in February recommended that Malaysia phase out blanket and broad-based subsidies and instead implement a targeted framework to better support its vulnerable citizens and rebuild fiscal buffers at the same time.”
Moving forward, Kadir stressed the need for the PM, Finance Minister, the Economic Minister, International Trade and Industry Minister, the PM’s Economic Council and BNM to endeavour to do better.
“Five months is a long enough time to show improvements,” he opined. “In the short time that the PH was in power (2018-2020), some of us made regular trips abroad to talk to fund managers and rating agencies to explain our policies and answer their queries. At home we held regular briefings and seminars.
(Editor’s Note: Kadir was the communication and media advisor to Tun Dr Mahathir Mohamad during the latter’s second premiership stint which lasted 22 months.)
Added Kadir: “The government should be seen to be talking directly to lowly farmers and mighty international investors instead of pontificating from the pulpit and picking up fights with the ghosts of the past.” – May 10, 2023
* 24 years is the waiting time that Datuk Seri Anwar Ibrahim had to endure before he was officially appointed as Malaysia’s 10th PM on Nov 24 last year (recall that he was sacked as deputy PM by Dr Mahathir in 1998).
