(MENAFN- Qatar News Agency) Malaysia will not impose capital controls for now but will use other existing financial instruments to correct any economic volatility, Malaysian Prime Minister Datuk Seri Mohammed Najib Abdul Razak has said. However, he did not rule out the possibility of implementing capital controls as a last resort.
Najib said the economy was resilient compared to other countries in the region due to its strong reserves position, coupled with high savings in the Employees Provident Fund (EPF), he said in statements. "Chances of a default is minimum. Despite our money leaving, our reserves are more than enough compared to what we had during the financial crisis in 1997," he added. Najib, who is also Finance Minister, said that the country's current reserves stood at US$130 billion compared to below US$30 billion in 1997.
Malaysia imposed capital controls in September 1998 during the contagion regional currency crisis in efforts to curb speculative attacks against the ringgit by unscrupulous hedge funds and to bring stability to the economy. The capital controls, which include pegging the ringgit to RM3.80 to a US dollar, were lifted in July 2005.
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