ASIA NEWS NETWORK
WE KNOW ASIA BETTER
Malaysia OKs more economic liberalisation measures
Publication Date : 10-06-2014
The Malaysian government has announced further liberalisation measures to strengthen the economy and promote investments.
These include the lifting of the barrier on new foreign unit trust management companies entering Malaysia.
This new measure, to take effect immediately, is aimed at making a wider range of competitive products available to investors and increasing competition in the sector.
Prime Minister Datuk Seri Najib Tun Razak also announced the removal of the mandatory credit ratings, the liberalisation of equity shareholding for credit-rating agencies and allowing full foreign ownership of international credit-rating agencies in the market.
These liberaliation measures – aimed at promoting investments in a broader spectrum of assets and corporate bond markets and enable investors to diversify their portfolios – would take effect on Jan 1, 2017, he said.
“Through these measures, we aim to further strengthen the Malaysian capital market so it may act as the catalyst for sustainable, long-term growth; not just domestically but also within our region. Our liberalisation programmes are designed to prepare our industries to compete in a new, more closely connected global economy.
“These policies bring benefits to investors and business people who will drive our national development forward. But the real benefit is for the people of Malaysia, who will reap the rewards of a sustainable, open and developed economy,” Najib said in his keynote address at the two-day Invest Malaysia 2014 that began yesterday.
Najib said the liberalisation of the credit-rating sector would take a gradual approach to provide industry players sufficient time to refine mechanisms necessary to operate under the new regime.
He added that from January 1 next year, flexibilities would be accorded to credit ratings and the tradability of unrated bonds and sukuk.
“The entry of international agencies will further enhance the quality and standard of rating services. Ultimately, this liberalisation will enable the Malaysian bond market to become a more cost-effective and attractive long-term financing platform,” he said.
Najib said he wished to see Malaysia emerging not just as a high-income economy, but also as a high-quality economy.
Achieving this, he said, meant building a stable and inclusive financial system, encouraging innovation and tackling corruption.
To this end, the Government had introduced policies and reforms to ensure growth was not just strong but sustainable, he said.
“To ensure Malaysia’s economic development lasts for the long term, we have put a high premium on innovation. We have established special funds to help entrepreneurs start and grow their businesses, encourage the use of technology and provide tax incentives so that the bright sparks of innovation are encouraged and sustained,” said Najib.
Touching on the role of the younger generation in the economy, Najib said more must be done to ensure their views were not just heard but accounted for in policy making.
“We must also keep the wider public engaged with our economic strategy by showing them that development belongs to all Malaysians,” he said.