Munir said that Malaysia is slipping back in terms of the capital market, despite having a dominant position within the region decades ago.
KUALA LUMPUR: The modernisation of local capital markets is essential to capture the interest of foreign investors and boost the country’s competitive edge against neighbouring markets.
Institute for Capital Market Research (ICMR) chairman Tan Sri Munir Majid stressed that Malaysia is slipping back in terms of the capital market, despite having a dominant position within the region decades ago.
“We were ahead of all our neighbours decades ago due to political stability. Now, political instability has caused a lot of damage in terms of attracting foreigners,” Munir explained during a fireside chat session at the inaugural industry-university talent bridging conference.
The event was hosted by the ICMR in collaboration with the Securities Industry Development Corp. Munir believes it is not easy for Malaysia to regain its dominant position.To do this, Munir proposed the concept of bundling funds, such as combining an Islamic fund with a green fund, as a strategic approach to create innovative financial products that cater to a broader range of investors.“We initiated the Islamic capital markets. We were the pioneers. But, where do we stand now,” he questioned.
Munir then pointed out that currently, the largest Islamic fund management markets reside in London, despite Malaysia having pioneered the concept. Additionally, Munir suggested a couple of specific initiatives that can “make people sit up and look at it”.
He opined on the revival of infrastructure project listings that could take place within the context of the belt and road initiative (BRI).“Clearly, this would benefit the BRI, boost our market and promote infrastructure development,” Munir explained.
The BRI is a large-scale development project initiated by China that involves building and enhancing trade and infrastructure networks between China and other countries.
Munir also suggested setting up digital infrastructure funds that can be listed, run and managed by experts who know where to put their money in technology.
In terms of talent, he said Malaysia has slipped back, but does not think all is lost because of the tech savvy, younger generation. In developing talent, Munir believes that recognising the needed skills, growing capabilities and inculcated value, is essential.“At the same time, we must deracialise the issue of education. You can stop the brain drain if we give opportunities to people, irrespective of race.”
Munir also believes Malaysia has the potential to become a hub for capital markets education, not just for Asean, but beyond developing market economies.
“In terms of ICMR, we can serve as the repository or clearinghouse for research work conducted by universities and industries, bringing these findings together and presenting them to policymakers,” he said.
Meanwhile, Securities Commission Malaysia chairman Datuk Seri Awang Adek Hussin believes a collaborative approach to obtaining ideas and gaining a broader perspective on the issues at hand is crucial for the country to navigate through headwinds within the capital market.
He acknowledged that, while the Malaysian capital market has done extremely well in the past, it is now facing strong headwinds and many challenges to overcome.
