KUALA LUMPUR, March 17 (Bernama) — Datuk Seri Najib Tun Razak said the world market’s confidence in Malaysia’s financial and macro management was increasingly visible and could not be denied especially with the strengthening of ringgit.
The prime minister said the strengthening of ringgit, coupled with the country’s encouraging economic growth, also lifted the confidence of foreign investors and attracted capital inflows.
The balance of payments data showed Malaysia recorded a big net inflow of foreign direct investments of RM27.6 billion last year compared with only RM5 billion the previous year.
“The net inflow of portfolio investment, meanwhile, rose to RM44.9 billion last year compared with a net outflow of RM1.7 billion in 2009.
“It’s proof of foreign investors’ confidence to invest in Malaysia, in equities and debt securities,” he said in reply to Datuk Wira Ahmad Hamzah (BN-Jasin) during question time in the Dewan Rakyat Thursday.
Najib who is Finance Minister, said the strengthening of ringgit generally gave advantages and positive implications to imports particularly in dealing with the increase in global food prices.
“Rising imported food prices will increase the rate of inflation and adversely affect economic growth. Hence, the strengthening of ringgit can mitigate the increase in food prices and therefore help contain inflation,” he said.
Besides, he said, the strengthening of ringgit could also lead to higher direct investments in high impact areas such as oil and gas, palm oil and infrastructure which require imported machinery and equipment.
On a supplementary question by Azan Ismail (PKR-Indera Mahkota) about a report by Global Financial Integrity (GFI) that Malaysia had lost RM889 billion through illicit outflows between 2000 and 2008, Najib said the answer would be given next month.
“I’ve asked Bank Negara to collect all information so that our response about the GFI report is comprehensive,” he said.
Source : Bernama