KUALA LUMPUR: Datuk Seri Najib Razak made the right choice in not pegging the ringgit as had been done when the 1998 financial crisis hit Asia.
Umno supreme council member Datuk Abdul Aziz Kaprawi said to have taken such a measure would mean that the government was unable to take action to improve the nation’s economy.
“If a currency peg is done, investors from the global arena would lose confidence in Malaysia’s economy and many mega projects which had been planned by the government would not be a reality,” he said in a statement.
Aziz said the ringgit had strengthened against the greenback in comparison to other Asian currencies, with an increase rate of 4.14 per cent. The Thai bhat had only strengthened by 3.6 per cent while the Japanese yen was at 3.36 per cent.
“Economic experts from Affin Hwang Investment Bank have also noted that the strengthening of the ringgit reflects the improvement in the country’s economic status.”
Aziz said, in the recent Umno supreme council meeting, Najib had announced that the nation’s gross domestic product had also seen a growth with the highest share prices on Bursa Malaysia in the past three years.
He said Najib had also said the inflation rate in the country remains controlled and low and the unemployment rate had remained at four per cent.
“All of these indicators are a testament to all the policies taken by the Barisan Nasional government. It also creates a confident environment for businesses and investors in Malaysia,” he said, adding that the World Bank had also predicted a strong economic growth for this year.
Aziz said he and all other BN leaders were ready to embrace Najib’s call to make 2018 a year of success and impressive results.
“This is a continuous commitment from us in the government to ensure Malaysia continues to grow for the future of our people,” he said.
In the recent Invest Malaysia 2018 conference, Najib had said Malaysia will “never, ever again” peg the ringgit currency against the US dollar.
He had said the previous peg during the 1998 crisis, when Tun Dr Mahathir Mohamad was prime minister, was maintained until 2005 and had resulted in loss of confidence among many global investors.
“We have made it very clear that we would never repeat the measure (pegging ringgit to the dollar), trusting that while there may be short-term fluctuations, in the longer term the level of the ringgit would reflect the strength of the Malaysian economy,” he had said.
Najib had said the government would now focus on lowering the fiscal deficit and also to keep government debt in check.