Guan Eng: State of emergency will drive off foreign investors

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Foreign investors will not be so easily tricked into believing that the declaration of a state of Emergency and the suspension of Parliament is to fight the spread of Covid-19 in Malaysia.

The state of emergency will further drive foreign investors away, with the suspension of Parliament till August, said DAP’s Lim Guan Eng.

The former finance minister slammed the Perikatan Nasional government, accusing ministers of being in denial.

“Foreign investors will not be impressed that Malaysia is the first country in Asia to suspend parliamentary democracy, a definite indication of chronic political instability.

“Therefore, the PN government should stop being in denial, that the state of emergency and suspension of Parliament will not help to attract foreign investors, when it is an admission of the PN government’s political instability, poor governance and failure to contain Covid-19 infections,” Lim said in a statement today.

He said the administration should face the hard truths about the repercussions of their actions.

He urged the government not to be blinded by its own smokescreen, adding that such moves will not attract foreign investments.

“Malaysia’s failure to manage and contain the surge of Covid-19 has been used as a pretext by Prime Minister Tan Sri Muhyiddin Yassin to wrongly advise the King to declare a state of emergency and prorogue Parliament.

“However, foreign investors will not be easily duped by Muhyiddin that the Emergency and suspension of Parliament is imposed to deal with this public health crisis, when they know that the movement control order (MCO) properly enforced is more than adequate,” he said.

The DAP secretary-general added that, even before the emergency, international ratings agency Fitch had already downgraded the country and the situation was only going to deteriorate further.

“Malaysia’s sovereign credit ratings were downgraded, while Prime Minister Muhyiddin Yassin still held his slim parliamentary majority.

Kamal Ariffin/TMI

“A state of emergency was declared, and Parliament suspended after Muhyiddin had clearly lost his parliamentary majority, further exacerbating political instability,” Lim said.

He also criticised International Trade and Industries Minister Mohamed Azmin Ali and Finance Minister Tengku Zafrul Tengku Abdul Aziz, who have fooled the public by saying PN’s moves will not hurt investor confidence.

“Are they implying that the state of emergency and suspension of parliamentary democracy will attract more foreign investment?

“Further governance in the government-linked corporations (GLCs) controlling tens of billions of ringgit in public funds, had deteriorated with the appointment of politicians and revelations by the Parliament Public Accounts Committee (PAC) of financial malpractices.

“Even before the state of Emergency, foreign investors have already relocated earlier to other countries. Hyundai relocated its Asia-Pacific regional headquarters for 33 countries from Kuala Lumpur to Indonesia,” he said.

Last December, Fitch Ratings agency downgraded the country’s long-term currency issuer default ratings from ‘A-‘ to ‘BBB+’.

Zafrul expressed the government’s disappointment with the rating, particularly in light of the current exceptional circumstances when the Covid-19 pandemic is still unfolding.

He said Malaysia had already started to see the green shoots of economic recovery, attributed to the various stimulus packages implemented by the government since March 2020.

He added that further governance in the government-linked corporations (GLCs) had deteriorated with the appointment of politicians and revelations of financial malpractices by Parliament’s Public Accounts Committee (PAC).

“Even before the state of Emergency, foreign investors have already relocated earlier to other countries. Hyundai relocated its Asia-Pacific regional headquarters for 33 countries from Kuala Lumpur to Indonesia.

“Foreign investors will not be impressed that Malaysia is the first country in Asia to suspend parliamentary democracy, a definite indication of chronic political instability,” he said.

On January 12, the Yang di-Pertuan Agong declared a state of Emergency across Malaysia that will last till August 1 after meeting with Muhyiddin the day before.

Muhyiddin said that the reason a state of Emergency was declared was the threat to Malaysia’s economy due to the spike of Covid-19 cases.