Tun Mahathir - Forex Revisited
As quoted in Nikkei: "When there are many people competing in currency trading, then it's a bit difficult to play around with the value
The start of the financial crisis that engulfed nations from Malaysia to South Korea to Indonesia is usually pegged to July 2, 1997, when Thailand's attempts to protect the value of its currency were overwhelmed by capital flows out of the country. The sharp devaluation of the baht led to pressure on other currencies and, within two weeks, to the collapse of the Malaysian ringgit's peg to the U.S. dollar.
From time and time again Tun Dr Mahathir felt the need to reassert himself as the global leader of the Muslim world, while balancing the need to develop Malaysia – from blaming Soros and the Jews for the Bank Negara forex scandals amounting to more than $10 billion to the numerous tirades against Western powers.
His argument for the first round of forex losses? That it was debated in Parliament and that the money’s did not go into his personal accounts as opposed to 1MDB.
Yes. The loss of RM31.5 billion through forex gambling was and still is a crime against the Malaysian people. And if it weren’t for Lim Kit Siang’s persistence and perseverance, we would not have gotten where we are now.
Three people have been found principally liable for the criminal breach of trust and should be probed further over their involvement and liability. They are the former Prime Minister Mahathir Mohamad, his then-Finance Minister Anwar Ibrahim, and ex-BNM advisor Nor Mohamed Yackop.
The commission found in its 524-paged report that the Cabinet in the 1990s was not given the full picture by Anwar on the forex losses, adding that he had “deliberately concealed facts and information and made misleading statements“. It is also of the opinion that the then Prime Minister (Mahathir) had condoned the actions of the Finance Minister.
The RM31.5 billion losses, the report said, were hidden using “unconventional accounting treatments”, such as booking losses to reserves in the balance sheet and the absorption of the remaining losses by the transfer of shares from the Government to BNM as well as the creation of a “Deferred Expenditure” to be repaid in instalments over a decade.
The RCI noted that Anwar Ibrahim, the then Finance Minister, had been informed about the actual forex losses suffered by BNM. It also said that Mahathir was informed by Anwar together with then Treasury deputy secretary-general Tan Sri Clifford Francis Herbert in late 1993 that BNM had suffered estimated losses of RM30 billion on the forex dealings for 1992 and 1993.
Without a doubt, this time is no different. It is likely that Tun Dr Mahathir felt that he can still gain some influence globally despite seeing it wane day by day in Malaysia - where no one listens to him anymore and no sensible politician even thought of crossing the line by joining his new party, PEJUANG.
As much as he tries, his track record has shown that he is very selective when it comes to issues concerning the Muslim ummah. Speaking up against France, a waning economic powerhouse that will be overtaken by the likes of Indonesia in the coming decades, is different than speaking up against China, whose atrocities against Muslim Uighur minorities is well documented.
Of course, naturally nothing much can be done about it during the Pakatan Harapan days, as his son Mukhriz Mahathir, then Chief Minister of Kedah, was looking to lure more investments into the state including a RM1.2 billion green paper industry park, among others.
Yet, the endless diplomatic rows will not only tarnish our name in the world, it will still carry economic impacts that elite politicians like the Mahathir family will never feel in their lifetime. Bear in mind that all of this happened while the European Union, which France is an influential member, is planning to phase out palm oil in the region. Antagonising an influential member of the bloc will only hasten the decision.
At the end, the rakyat and Malaysia will always pay the final price whenever Tun Dr Mahathir becomes a loose canon, with his polemics that only serve his ego and never the nation.
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