Stronger Ringgit Positive for Economy, Investment -- Sim

GEORGE TOWN, Feb 18 (Bernama) -- The strengthening of the ringgit against the US dollar is seen as a positive development for the Malaysian economy, thus offering direct benefits to the people and the country's business and investment sectors. 

Deputy Investment, Trade and Industry Minister Sim Tze Tzin said the performance of the local note,  which returned to a stronger level, reflects foreign investors’ confidence in the country’s economic stability. 

He said that during the early part of Prime Minister Datuk Seri Anwar Ibrahim’s administration, the ringgit once traded around 4.50 against the US dollar before gaining to its current level of around 3.89.

"The firmer ringgit reflects the rising inflow of foreign investments, in addition to more international tourist arrivals, which continue to contribute to domestic economic growth.

“The ringgit value can be said to be at its most comfortable and stable level at present, and we hope that this strengthening will bring benefits to the people," he said. 

He said this to reporters following Penang Parti Keadilan Rakyat (PKR) Chinese New Year MADANI Open House at Wisma PKR, in Bayan Baru near here today. 

Also present were Penang Chief Minister Chow Kon Yeow, Education Minister Fadhlina Sidek and PKR state leadership council chairman Datuk Mohamad Abdul Hamid, who is also Deputy Chief Minister I, as well as the party’s state leadership. 

Sim said that among the main benefits for people, including those in the agriculture and manufacturing sectors, is increased purchasing power, as the prices of imported goods such as fertiliser, machinery, and raw materials have become more stable. 

He said that when import costs are better controlled, it helps stabilise food prices and reduces the pressure on rising living costs. 

“In addition, the manufacturing sector also benefits when the cost of purchasing machinery and technology from abroad becomes more competitive, thus increasing the productivity of local industries,” he said. 

He said currency stability also contributes to a stronger economic environment and helps ensure that consumer goods prices do not increase dramatically.

As for the ringgit’s prospects this year, Sim anticipates the local note to remain at a stable level without sudden fluctuations. 

He cautioned that excessive gains could also exert pressure on the export sector; hence, the current level is considered comfortable and balanced for economic growth. 

“Improving investor confidence and tourist arrivals are expected to continue to stimulate gross domestic product growth via increased economic activities, especially in tourism, manufacturing, and small and medium enterprises sectors,” he said. 

He added that the Ministry of Investment, Trade and Industry (MITI) would continue to intensify promotional efforts to attract more investors to the country, in line with its role as the lead agency in driving investment and trade.

-- BERNAMA