PETALING JAYA: The weak ringgit may be a matter of concern for many, but it could also be a blessing, an economist says.
Prof Dr Barjoyai Bardai, who leads a team of Islamic banking and finance experts, said many countries deliberately devalue their currencies.
“Thailand is an example. They do it so that the country becomes more attractive to investors and tourists.
“But it should be done in a controlled manner so that the currency will not be seen as weak,” he said.
“Every country is seeing their currency slide except the United States, but the sliding points are different between countries,” he added.Prof Bardai said the ringgit is actually strengthening when compared with the yen, pound sterling and Chinese yuan.
“We are weak if we compare ourselves with the United States, Singapore and Hong Kong, but the situation is still under control.”
He pointed out that Malaysians would not have to worry too much about the currency rate if we reduced our dependency on imported goods and opted for local products.
“We are worried because it would increase the cost of living, and this is due to higher prices of [imported] goods. And when wages remain the same, many feel poorer,” he said.
Employment could be affected if global inflation worsens, he said.
“We call it stagflation. It is when inflation in the whole world increases amid a flat growth rate because the global economy is frozen.
“When that happens, demand for imported goods will be reduced, and Malaysia will not be able to export all of its products,” he said.
“With the weakening ringgit, our tourism industry would be booming, but it would also mean Malaysians have to work harder,” said economist Tan Sri Dr Ramon Navaratnam.He called on the government to get rid of the old ideas of running the economy.
“We have to be more competitive. There must be structural changes in the economy, politics and social development; otherwise, the gap between the rich and poor will widen.
“We have to fight harder. We have to fight corruption, cronyism, racism, mediocrity, and the brain drain to overcome these challenges,” he said.
