Emergency spending rule could spook investors further - ex-finance minister II

 

The new emergency ordinance, which allows Putrajaya and state governments to tap into consolidated funds without scrutiny, could scare away more investors, according to former second finance minister Johari Abdul Ghani (above).

Johari said the ordinance - which could also allow supplementary budgets to pass without approval from Parliament - showed that the government was politically unstable, and this, in turn, affects investor confidence.

"How can a democratic country like Malaysia be managed via an ordinance, without going through the scrutiny of Parliament?

"Under the present political environment, it is difficult to attract investors to our country.

"It will affect the confidence of the investors in the long run and over time, it will further affect our sovereign ratings - especially when the government has to rely heavily on borrowing," Johari told Malaysiakini.

The United Nations Conference on Trade and Development said in a report released in January that the said foreign direct investment (FDI) into Malaysia fell 68 percent last year, the worst rate in Southeast Asia.

However, International Trade and Industry Minister Azmin Ali denied that Malaysia was losing out on foreign investments from big MNCs to other countries in the region.

Instead, Azmin claimed, the government was being selective about foreign direct investment (FDI), which Johari said was nonsense.

The ordinance gazetted yesterday suspended provisions in the Government Funding Act 1983 and Treasury Bill (Local) Act 1946 that gave the Dewan Rakyat oversight over government spending.

Critics pointed out that if it was not for Parliament’s oversight, an RM85.5 million budget for Putrajaya’s propaganda arm would have been approved last year instead of being reduced to RM40.5 million.

Parliament and all legislative assemblies, however, have been suspended since Jan 11 through a proclamation of emergency.

Commenting on the ordinance, DAP veteran Lim Kit Siang said Budget 2021 should have allocated sufficient funds for the country's Covid-19 response.

Lim said if valid additional spending was required, then Prime Minister Muhyiddin Yassin should advise the Yang diPertuan Agong to convene Parliament.

"Any valid additional spending to combat the Covid-19 pandemic will get the unanimous support of Parliament, as all MPs from all political parties would like to see the Covid-19 pandemic ended as early as possible," he said in a statement this morning. - Mkini