Stakeholders agree New Economic Model has brought progress
KUALA LUMPUR: Economists and corporate leaders have responded positively to Prime Minister Datuk Seri Najib Razak’s economic policies implemented over the past eight years.
They agreed that the policies introduced under the “New Economic Model” had brought significant progress in creating the right fundamentals for a secure, stable and successful Malaysia.
Permodalan Nasional Bhd chairman Tan Sri Abdul Wahid Omar said the buoyant stock market was reflective of the government’s more inclusive and sustainable policies.
“The prime minister has given a very important message in terms of progress achieved by Malaysia since 2009,” Wahid said on the sidelines of Invest Malaysia 2018 here yesterday.
He was responding to Najib’s keynote address to more than 1,000 local and foreign delegates.
“What we see in Malaysia right now, is a holistic package where the macroeconomy, monetary policy and, of course, strong performance of the corporate sector. All these aspects are very important (to ensure the economy stays strong),” said Wahid.
MIDF Amanah Investment Bank Bhd head of research Mohd
Redza Abdul Rahman said the 55 per cent limit placed on the country’s debt level indicated the government’s seriousness in keeping debt in check.
“The efforts to address fiscal deficit, on the other hand, reflects government prudence in adhering to its fiscal discipline. This, in return, will positively affect our sovereign credit rating,” he said.
On the government’s move to rule out re-pegging the ringgit to the United States dollar, Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said as a sovereign state, Malaysia was free to decide what was best for it.
“In the context of pegging the ringgit, it was introduced during a turbulent period where Malaysia’s financial system was weak and the outflow was huge.
“But now, the situation has changed. We have deep capital markets, where companies and government can always tap the bond market for long-term funding.”
He added that local banks were well capitalised and highly liquid. Therefore, the country could allow market forces to determine the value of the ringgit with minimal intervention.
“It’s just that the non-deliverable forward market has distracted the spot market in the recent market volatility episode.
“So, the measures introduced was very specific to address the specific issues,” said Afzanizam.