by FAYYADH JAAFAR / pic MUHD AMIN NAHARUL
FORMER Prime Minister Datuk Seri Mohd Najib Razak’s (centre) being put behind bars for the SRC International Sdn Bhd corruption case will have a good impact on Malaysia’s economy, although not significantly.
Putra Business School Assoc Prof Dr Ahmed Razman Abdul Latiff said the economy’s positive outlook would be minimal.
“One man’s conviction is not enough momentum to bring back the investors’ confidence nor significantly improve the country’s economic situation.
“More heads must roll to demonstrate the government’s sincere action of combating corruption to the core,” he told The Malaysian Reserve (TMR) today, adding that investors and businesses had already taken the scandal into account before the Federal Court made its decision.
On the currency, Ahmed Razman said it is heavily influenced by the movement of the US dollar, therefore Najib’s case will not directly affect the ringgit.
“Our currency is still heavily influenced by what is going on in the US, namely the technical recession, rising inflation and Federal Reserve’s interest rate hikes.
“Political stability in general will play a greater role in impacting the ringgit than Najib’s case alone,” he added.
He also commented on the economic legacy of Najib’s policies, saying people may not necessarily be supportive of future mega projects initiated by the government unless they are really necessary and can benefit the majority of the population.
“The priority now is to make sure every government project is conducted in a transparent manner and with full accountability,” he said.
Meanwhile, Centre of Market Education CEO Dr Carmelo Ferlito said while there might be a tendency to see a positive impact on the economy from the Federal Court’s verdict, it adds political uncertainty.
Ferlito pointed out that Najib’s absence from Umno left a large vacuum to be filled.
“There might be a higher degree of power struggle in Umno. The impact on the economy will be determined by which faction in Umno comes out as the winning one, who will win the elections and with what economic platform,” he told TMR.
He added that economic players would take a “wait and see” approach, for which strategy would emerge within the ruling coalition.
He said Malaysians have seen in the last two years the emergence of a leadership that is less open to economic freedom and more oriented towards a higher degree of government control.
“This is not good. It is a bad signal for the economy if such leadership remains predominant in the next election.”
Ferlito also noted that Najib represented Malaysia’s commitment to economic openness and a friendly behaviour towards “doing business” while the three governments that followed seemed “confused” about it.
“The pandemic encouraged government interference in the economy, with the negative consequences we are paying now in terms of higher debt, inflation, labour shortage, weaker ringgit and so on,” he said.
Ferlito suggested that at this specific moment, Malaysia should look backward to rediscover the openness vocation that made it a successful country.