NILAI – In order to address the depreciating ringgit, the government is seeking to strike a balance so that the country’s interest rates would not cause the flight of foreign investors, said Datuk Seri Anwar Ibrahim.
The prime minister said the local note’s drop was linked to the country’s low interest rates, and if the government raised the rates too high, it would burden small and medium companies.
“If I have RM1 million, I want to put it in a bank. I have a choice of Malaysia, Singapore, and Indonesia. Singapore and Indonesia have high interest rates.
“So, I choose to save it outside (Indonesia and Singapore). That is our problem now,” he said at a programme at Universiti Sains Islam Malaysia here today.
He said this when answering a question from a Form 6 student, identified as Adriana, who wanted to know the action the government was taking to strengthen the country’s currency.
Anwar, who is also finance minister, said although faced with a declining ringgit, the country’s economic growth continued to rise in the first quarter of this year, surpassing those of Singapore, Indonesia, and China.
“It would have been different if our economy had dropped, with a drop in the ringgit’s value, lower investment and lower growth. But that was not our case. Our investment is good at RM71 billion in the first four months. We just have to find ways to bring back investments with several incentives.
“I say setting up a financial hub in Johor is one way. Then MM2H (Malaysia My Second Home) to bring in people who can bring in money and several more which I announced last week. We are thinking of several more measures,” he added.
However, Anwar admitted that it would not be easy to attract more investments because foreign investors still perceive instability in the country following rumours that there might be a change of government this August.
“It is good that people (investors) are more confident in me than them. They say if Anwar is still leading, they have confidence the government will be stable. If others take over, they will withdraw. I’m not campaigning for the unity government but this is a fact,” he said. – Bernama, June 24, 2023
