Address Issues Raised In Fitch Report Kit Siang Tells Tengku Zafrul

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Veteran DAP politician Lim Kit Siang said Finance Minister Tengku Zafrul Aziz should address valid and credible criticisms in the Fitch report.PETALING JAYA: DAP veteran leader Lim Kit Siang has urged Finance Minister Tengku Zafrul Aziz to address the issues outlined in the latest Fitch Ratings report, which led to a downgrade in Malaysia’s sovereign rating on Friday.
The Iskandar Puteri MP said Tengku Zafrul’s statement in response to the downgrade had failed to touch on Fitch’s criticisms of weak governance, corruption and enhanced debt, among others.
“It is somewhat pathetic as rebuttals go. The case made out lacks credibility as it is largely built on repeating the usual ‘feel good’ numbers and assertions.
“Valid and credible criticisms in the Fitch report should be addressed,” said Lim in a statement.
Noting that other Asean countries had not been downgraded, Lim warned that the country’s lowered sovereign rating would affect the government’s cost of borrowing and foreign investments in the country.
He said it might also impact the country’s exchange rate and its foreign relations, with the country likely to become more dependent on China for loans to fund large-scale projects.
There is an urgent need to conduct a comprehensive public expenditure review to strengthen the fiscal system, he added.
“This needs to be accompanied by deregulation of rules and processes to create an environment which deters corruption.
“While it is true that Covid-19 has hurt the economy, the reality is that for 20-odd years we have run deficits and kept going on borrowings. We have continued to tighten the regulatory regime but failed to promote competition,” he said.
US credit rating agency Fitch Ratings had dropped Malaysia’s sovereign rating from “A-” to “BBB+”, with an improved outlook from negative to stable.
Tengku Zafrul had responded by saying the government was disappointed with the rating outcome, adding that the downgrade was driven by the impact of the Covid-19 pandemic on Malaysia’s fiscal position and the domestic political situation. - FMT

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