The ringgit will continue with its current free fall unless a certain "person” is not around, said former prime minister Tun Dr Mahathir Mohamad.
While he did not name the person, it is widely assumed the retired statesman was referring to Prime Minister Datuk Seri Najib Razak.
Dr Mahathir said the performance of the Malaysian currency was worse than during the Asian financial crisis from 1997 to 1998.
Citing the Thai baht as an example, he said at its worst, the exchange rate between the ringgit and the Thai currency was RM1 to 10 baht.
But now it was RM1 to only 7 or 8 baht, said Dr Mahathir.
"Why is this happening? It is because people do not trust Malaysia's economy, they want to run and are dumping the ringgit because the value may drop further tomorrow.
"This will become worse in the future. I don't see how it can improve unless the person is not around," he said at a talk, titled “Malaysia Hari Ini: Ke Mana Kita? (Malaysia Today: Where are we heading?)”, at the Pasir Gudang stadium in Johor this afternoon.
Dr Mahathir has been one of Najib's most strident critics and has repeatedly called for the prime minister's resignation over the scandals surrounding 1Malaysia Development Berhad (1MDB) and the RM2.6 billion "donation" from an unknown Middle Eastern donor into Najib's personal bank accounts.
Dr Mahathir said today the ringgit was so weak now that some people do not even want to use the currency, and those who have it would rather exchange it for other stronger currencies.
He also said a lot of Malaysians, especially those with children studying overseas, struggled to cope with the weak ringgit.
Despite Putrajaya's assurance that the country's fundamentals were strong, worries remained over the economy as the ringgit, Asia's worst performing currency in the past one year, has plunged beyond RM4 against the US dollar while foreign exchange reserves slipped below US$100 billion last month for the first time since 2010.
Many attributed the ringgit's poor performance to the worsening global outlook, China's surprise devaluation of the yuan, plunging commodity prices and the current political scandal linked to Najib.
Najib is facing intense scrutiny over the US$700 million (RM2.6 billion) "donation" from an unknown Middle Eastern donor into his personal accounts while at the same time, his brainchild, state investment firm 1Malaysia Development Berhad (1MDB) is facing multiple probes over its alleged financial irregularities.
The country is also suffering from a perception of interference when Tan Sri Abdul Gani Patail was abruptly replaced as attorney-general while the Malaysian Anti-Corruption Commission (MACC) offices were raided and its officers detained for questioning by the police over alleged leak of information related to 1MDB.
On Tuesday, Najib announced a new committee to ensure Malaysia's economic growth in the face of what he described as "uncertain and challenging times".
"The committee's objective is to ensure Malaysia's growth momentum will continue for some time and be able to generate prosperity in the rather uncertain and challenging times," he said.
Najib, however, said the details about the committee wwould be announced "soon". – August 29, 2015.
http://www.themalaysianinsider.com
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