Malaysia Has Buffers To Weather Capital Outflows -- Abdul Wahid
By Karina Imran
KUALA LUMPUR, June 25 (Bernama) -- Malaysia has adequate buffers to weather volatility, including capital outflows, triggered by global interest rate hikes, said International Centre for Education for Islamic Finance (INCEIF) University Professor of Practice Tan Sri Abdul Wahid Omar.
Abdul Wahid, who is also a former Bursa Malaysia chairman, noted that the country has sufficient international reserves to cover a good number of months of retained imports and short-term debt obligations.
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'We also have many investments abroad. I think it is not just about foreign investments here (in Malaysia) but also about our domestic investors investing abroad as well.
'That provides the flexibility to meet the challenges,' he told Bernama on the sidelines of the Islamic Finance Future Leaders Bootcamp 2025, here today.
Abdul Wahid also highlighted that while equity markets experienced both inflows and outflows in recent months, such movements are cyclical.
'When it comes to the financial market movements, initially, it will happen from time to time. But everything is relative. We have seen significant outflows in the equities market, and we had a positive inflow in May. But the situation reversed in June. Everything is relative.
'There will come a time when some of this money will come back to Malaysia. As long as we focus on the fundamentals, there will be that fluctuation. But in the longer term, money will flow back to an economy that is growing,' he said.
Commenting on Malaysia's economic prospects, Abdul Wahid said that the shift away from commodity dependence over the years has strengthened the country's economic fundamentals and positioned it to better absorb external shocks.
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