Weaker dollar won't hurt exports

THE easing of the American dollar will not affect Malaysia’s exports as the currency is not the instrument that decides the export situation, Second Finance Minister Tan Sri Nor Mohamed Yakcop said.Instead, measures such as the use of an innovative system, reduction in costs and exploration into new markets will be able to raise export levels, he said in reply to a supplementary question from Fong Kui Lun (DAP-Bukit Bintang)at the Dewan Rakyat today.“In the present day, it is too complicated to use the ringgit’s exchange value as the instrument to increase export,” he said. In order for traders to carry out their business, the stability of the currency rate is important and it is not the specific exchange rate such as 3.2 or 2.8.
“The important thing for traders and businesses is that the rate is stable and there is no situation of volatility in the market,” Nor Mohamed said.The government has taken various measures to diversify the country’s exports to the non-traditional export markets, including the signing of bilateral agreements with many south nations.“Therefore, our exports at the moment are highly diversified, and we are not that dependent on the United States or other countries.“The government will continue to look at other measures and incentives for exporters in terms of budget and also use MIDA (Malaysian Industrial Development Authority),” he said.Nor Mohamed said the government would ensure that there is no speculation on the ringgit with the continued policy of not giving loans in ringgit to outsiders. He said the crisis in 1997 and 1998 was brought on by currency manipulators who had been allowed to borrow ringgit and sell the local currency unit.“What we did during the crisis..was very simple. We just did not allow them to borrow ringgit for selling. “That solution is still in our system,” he added.Meanwhile, the minister also said that Malaysia will retain a ban on currency traders borrowing the ringgit for trading.Malaysia has maintained the ban since the 1997/98 Asian financial crisis.-reuters