Pakatan Harapan is hurting Malaysia’s economy and the Ringgit
Speculators and investors do not care whether a government is democratic or autocratic. But they do care when a government is unstable, even if it is democratic. So the constant attacks by Pakatan Harapan and the non-stop threats of toppling the government are what is frightening speculators and investors.
NO HOLDS BARRED
Raja Petra Kamarudin
As a former finance minister and deputy prime minister, Anwar Ibrahim seems to lack understanding of how investor confidence works…or maybe he is just bullshitting — thinking that Malaysians will swallow his bullshit hook, line, and sinker.
The main reason for fluctuations in exchange rates is due to supply and demand. If Malaysia exports more than it imports, and exports in Ringgit, then the demand for Ringgit goes up. But if Malaysia imports more than it exports, and imports in foreign currencies, then the demand for Ringgit goes down.
In January-August 2021, Malaysia’s exports grew by 18.4% to RM95.59 billion, the 12th consecutive month of year-on-year (y-o-y) expansion since September 2020. Imports expanded by 12.5% to RM74.2 billion, while Malaysia’s trade surplus was up by 44.7% to RM21 billion.
In 2022, the value of Malaysia’s imports surpassed the RM100 billion mark for the first time ever in March 2022 after growing 29.9% to RM104.9 billion from RM80.8 billion a year earlier, as the nation’s export and total trade value climbed to record highs.
In a statement, the DOSM’s chief statistician, Datuk Seri Dr Mohd Uzir Mahidin, said Malaysia’s export value increased 25.4% to RM131.6 billion from RM105 billion while total trade value grew 27.3% to RM236.6 billion.
Hence the Ringgit is not weakening because business is down. In fact, business is up. But the demand for Ringgit is down as we trade in US$, not in Ringgit.
One reason for the drop in demand of the Ringgit is due to the constant threats the opposition is making about toppling the government. Stock market and currency traders are scared when there is talk about toppling the government.
Speculators and investors do not care whether a government is democratic or autocratic. But they do care when a government is unstable, even if it is democratic. So the constant attacks by Pakatan Harapan and the non-stop threats of toppling the government are what is frightening speculators and investors.
In short, Pakatan Harapan is the one causing the Ringgit to weakan.
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Weaker ringgit shows world losing confidence in Malaysia, says Anwar
(FMT) – The ringgit’s dissipating value has shown that the world has lost confidence in Malaysia, opposition leader Anwar Ibrahim said today.
In a Facebook post, Anwar said short-term solutions and quick fixes by the government were not enough.
“We need leadership that must first inspire the confidence of the people before we can dream of inspiring foreign confidence and then investment.
“A proper plan for a proper recovery requires complex thinking and an appreciation for the complexity of contemporary economics,” he said.
The Port Dickson MP, who is a former finance minister, explained that Malaysians were trapped in a cycle where the people work harder and make less while the price of basic needs has risen exponentially.
“I compel the government to give the rakyat a long-term solution that can inspire the confidence we all deserve.
“The people’s work is paramount to bringing this nation back and you, the people, deserve just reward for your labour,” the PKR president said.
The ringgit weakened past RM4.40 to the US dollar last week for the first time since the onset of the Covid-19 pandemic, but made a slight recovery to RM4.38 on Friday.
