Mahathir Attacks Najib's Liberalisation Policy
KUALA LUMPUR, July 4 — Former premier Tun Dr Mahathir Mohamad has dismissed the efforts of Prime Minister Datuk Seri Najib Razak to liberalise the economy, saying they were “not going to help anybody”.
The plan seemed designed to make Najib popular, said Dr Mahathir, adding: “It will not help the Chinese, Malays or Indians.”
Dr Mahathir was asked to comment on Najib's steps to open up the economy to make it more attractive for foreign investors.
The steps included relaxing a host of restrictions on foreign investment, including a rule requiring businesses to be partly owned by Malays.
Listed companies will no longer be required to allocate 30 per cent of their stake to Malays as part of an affirmative action programme for the country's Malays.
Among other measures were allowing stock brokers and unit trust management companies 70 per cent foreign ownership, up from the current level of 49 per cent.
Najib also announced a government private equity fund to invest in high-growth industries and promote Bumiputera ownership of Malaysian businesses.
Najib said the Bumiputera rule for companies was neither benefiting poor Malays nor sustainable amid the global economic slowdown, which would force Malaysia into its first recession in a decade.
But Dr Mahathir was not impressed.
“I think it's a kind of move more designed towards becoming popular. I don't know if it will help the economy, because Malaysia has been growing since independence,” The Star newspaper on its website quoted Dr Mahathir as saying.
“Now that there is a lack of growth, this is due more to external reasons. It's not about internal things,” he told reporters.
He also said Malaysia should be cautious of foreign investors keen on total ownership of fund management companies as they “owed no loyalty to the country”.
“They are here to make money. When they can't make money, they go out and we pay the price,” he was quoted as saying.
He asserted the potential hazard of capital flight should investors no longer find the Malaysian market lucrative saying: “In some instances, they come to build factories and produce things for export. Well, that's fine. But when they can openly go into the market, well, that's not good,” he said.