KUALA LUMPUR: Bank Negara Malaysia Governor Datuk Muhammad Ibrahim has urged the younger generation to be more optimistic about Malaysia’s economy and to be fair in their responses to the good numbers published by global rating agencies.
“Malaysia’s economy is in a sweet spot. In the first quarter of the year, our economy grew by 5.6 per cent, surpassing market expectations. Growth was lifted by the stronger domestic demand.
“Our exports also are generating greater positive spillovers to the domestic econom. I urge the younger generation to be more optimistic.
“Be fair in your responses to good numbers published by global rating agencies. Why the pessimism? Malaysians tend to be very creative when it comes to rumours. We do not come up with numbers or manipulate data, obtained from the Statistics Department,” he added.
Muhammad responded to a query from fund managers as to why Malaysia’s economic outlook and the general public’s sentiment do not seem to be aligned.
The central bank governor was addressing 1,500 delegates gathered here today at Invest Malaysia 2017. Of the total number of delegates, more than 900 are fund managers with total assets under management of US$19.9 trillion.
He highlighted that foreign investments in Malaysia have yielded significant returns.
“Returns on foreign direct investments have been one of the highest in Asia, having grown by an average of 13 per cent per annum. That is higher than Malaysia’s nominal economic growth of 7.7 per cent.”
“Clearly, Malaysia is a regional profit centre where foreign investments are protected and is allowed to operate in a conducive environment,” he said, adding that profits by investors are freely movable.
“Malaysia does not impose any restriction on the repatriation of profits, even during difficult times. This is a fact sometimes missed by analysts,” he said.
Earlier in the morning, Prime Minister Datuk Seri Najib Razak had officiated at the opening of Invest Malaysia 2017, the 13th edition of this series organised by Bursa Malaysia. Najib said Malaysia’s economy continues to grow as the government took tough but unpopular decisions to build up resilience.
Muhammad went on to highlight that foreign exchange measures Bank Negara introduced in December 2016 is working effectively in balancing the ringgit’s demand and supply in the currency market.
He noted a recovery in the onshore foreign exchange to a stable daily average volume of US$10 billion, an increase of 1.25 times before the measures.
A week ago, UOBKayHian Research in its notes to investors speculated Alliance Financial Group Bhd (AFG) could be looking to merge with Hong Leong Bank Bhd (HLB) the fifth-largest lender by assets in Malaysia and 64 per cent-owned unit of Hong Leong Financial Group Bhd.
When asked whether AFG or HLB had submitted applications to the Bank Negara for a possible merger, Muhammad replied, “No, we did not receive any application from either banks. If we had, we would have announced the receipts of such.”
Asked if he thought AFG and HLB are a good match for marriage, he replied, “as the regulator of the banking industry, our view is for any bank mergers to materialise, it has to be market driven.”