Ringgit sees gains due to coordinated efforts - Amir Hamzah

Malaysia curbs outward investment, focuses on domestic market

19 Mar 2024 04:30pm
Photo for illustration purpose only. - FILE PIX
Photo for illustration purpose only. - FILE PIX

KUALA LUMPUR - The ringgit was in first place compared to nine other regional countries since the coordination measures among the government, Bank Negara Malaysia (BNM), government-linked investment companies (GLICs) and government-linked companies (GLCs) were implemented on Feb 26, 2024.

Finance Minister II Datuk Seri Amir Hamzah Azizan said the local currency’s performance was based on data from BNM’s Financial Markets Committee on March 1, 2024, which stated that there was an immediate impact on market trends and increased market interest in the ringgit.

"The government is committed to ensuring that the performance of the ringgit is at a better and stronger level," he told Dewan Negara today.

He said various measures have already been taken, and that BNM always ensures that the domestic foreign exchange market remains orderly and maintains financial stability. The Malaysian central bank also continues to monitor the financial market and take the necessary measures, including intervention in the foreign exchange market, to curb excessive currency movements.

In addition, he said, BNM also monitors the conversion of export revenue into ringgit by exporting companies and continues to encourage the use of local currency for export settlement so that dependence on the US dollar can be reduced.

He said that the Ministry of Finance and BNM have taken integrated and coordinated actions to bring money into the foreign exchange market. "Among them are encouraging GLICs and GLCs to bring back foreign investment income and convert the income to the ringgit more consistently."

Amir Hamzah said the government also controls overseas investment by private companies to reduce pressure on the ringgit, this includes encouraging them to prioritise domestic investment and delaying new overseas investment. "Overseas investment must be managed prudently such as protecting the value (of the ringgit) through 'hedging' foreign currency exposure and bringing back the proceeds of overseas investment."

In addition, he said that besides the joint measures with BNM, the government is also focusing on economic reform efforts which will indirectly strengthen the economic performance and the ringgit.

Related Articles:

"The government has introduced the MADANI Economic framework, with the main pillar being to restructure the economy to emerge as a leader in Asia. The MADANI economy focuses on ensuring Malaysia is a competitive investment destination," he said.

Meanwhile, he said in dealing with the issue of the value of the ringgit, all parties should play their respective roles and Malaysians are expected to adopt a "Malaysia First” attitude as daily consumers.

"Buy Malaysian goods and services, as well as invest in unit trusts and domestic hedge investments," he said, adding that the campaign to travel within the country and buy local goods will continue to be increased because it helps strengthen the ringgit and improve economic performance.

He said that to encourage the influx of foreign tourists, the government has taken steps, including exempting visas for 30 days for Chinese and Indian citizens from December 2023. - BERNAMA