Najib: Valuecap will not be used to bail out GLCs

Published: Thursday December 4, 2008 MYT 1:01:00 PMUpdated: Thursday December 4, 2008 MYT 1:08:18 PM
Najib: Valuecap will not be used to bail out GLCs

KUALA LUMPUR: The RM5bil increase in allocation for Valuecap Sdn Bhd will not be used to bail out politically connected individuals or government-linked companies, Deputy Prime Minister Datuk Seri Najib Tun Razak said.
”I wish to give a categorical assurance that Valuecap will be used for value investing and will not be used to bail out anyone,” Najib, who is also Finance Minister, said at the 13th Malaysian Capital Market summit here on Thursday.
He said Valuecap would be professionally and ethically managed with no political interference in its investment decisions.
Najib also said the creation of an Asia Monetary Fund could help the region deal with the current global financial crisis as it would help out countries with short term balance of payments and liquidity problems.
”I would just like to float the idea once again (and) let’s see the response from the other countries on it.”
Asked on the funding of the proposed monetary fund, he said the details would have to be worked out later, but it needs to be discussed in greater depth by leaders and Asian Finance Ministers.
Najib also proposed that the Securites Commission proactively look into how Malaysia can attract more portfolio investments from the Asian region, mainly China, India and Asean countries to invest into the Malaysian stock market.
”We can deepen our bilateral relationship with these countries by attracting more companies to list on Bursa Malaysia,” he said.
He said China, for instance, has enormous foreign exchange reserves which amount to larger that the combined reserves of all the Group of Seven (G-7) countries added together, which is over US$2trillion.
”The Chinese government has encouraged Chinese companies to go abroad, hence there is potential in attracting more Chinese investments including Chinese portfolio investments into Malaysia,” he said.
Asked on the government’s growth projection of 3.5% for next year, Najib said that although there were lower forecasts made by others, “let us see of the development for the next one or two quarters.” ”Right now it is 3.5%, but it is not an embarrassment to review it,” he said.
He said that even Singapore reviewed its growth forecast four times. “Nobody really knows the problem out there or how deep the problem is, it is anybody’s guess.”
He said there were no indications that Malaysia would slip into recession next year or even into a technical recession.
”But the government will monitor the situation very closely,” he said.
Asked whether the RM7bil stimulus package was enough to achieve growth next year, Najib said” “Let us see developments because there are all kinds of views and forecasts.”
“Let us not get excited about the forecast,” he said when commenting on statements made by the Malaysian Institute of Economic Research (MIER) that the government needed to spend more than RM7bil to avoid slipping into recession.
MIER claimed that the RM7bil stimulus package would only help to soften the blow of a global economic crisis as the magnitude of the impending crisis was too big to be contained by a stimulus package of this size. - Bernama