SINGAPORE (The Straits Times/Asia News Network): Malaysia has rekindled foreign investors' interest in the country under the watch of Premier Ismail Sabri Yaakob, receiving record levels of foreign direct investment, said Economic Director in the Prime Minister's Office Shahril Hamdan on Monday (July 4).
Crediting Prime Minister Ismail for his strong mandate to make Covid-19 lockdowns "a thing of the past" and keep economic activities running, Shahril said: "I think many understate his achievements in office."
He highlighted how, in less than a year since Datuk Seri Ismail took on the premiership on Aug 21 last year, foreign direct investment figures have bettered pre-Covid-19 levels to hit records for two quarters straight.
Government data shows that Malaysia approved RM24.9 billion (S$7.9 billion) in the final quarter of 2021 and RM26.8 billion in the first quarter of this year. Top foreign investors included the Netherlands, Singapore and China.
The next growth report will also reflect a figure that will "impress", Shahril said.
He was speaking as a panellist at The Straits Times Connect webinar, titled Malaysia: On The Path For A Reset?
His fellow panellist, The Straits Times' Malaysia bureau chief Shannon Teoh, said critics had once panned Malaysia as "a sick man of Asean" when investment figures in 2020 were "very low".
"Somehow, this administration has managed to excite investors again," he said, adding that the investments cited would take some time to actualise and create jobs.
"But it is a good signal, and I think if you were in the administration right now, you want to keep this momentum going."
The question is how much time there is for the current government to make an impact, Teoh added, referring to growing speculation that Malaysia may go to the polls soon.
A general election must be held by September 2023, but the Prime Minister may decide to call it before that.
Shahril said polls may be called within six months, in response to a question by ST foreign editor Bhagyashree Garekar, who moderated the discussion.
Teoh, however, said it could benefit Ismail's party Umno, which leads Malaysia's Barisan Nasional (BN) coalition, if elections were held early next year.
This could give the administration time for inflation to taper off as well as to sort out party infighting.
Rifts in Umno have seen the party divided into two camps loyal to Ismail or party chief Ahmad Zahid Hamidi.
An Umno MP, recently sacked from the party's supreme council, last week revealed that there had been a plot in 2020 to unseat Zahid.
Shahril, who is also Umno's information and deputy youth chief, had made a call for party unity last week.
"I think the public now is waiting and needing a strong government, stable politics. They want to see an Umno that is not riddled with internal divisions," he told the panel on Monday.
"Umno's strengths vary, and it has blind spots and weaknesses. But all things remaining equal, a unified Umno is probably a strong favourite for the next election."
BN won a two-thirds supermajority in Johor's state polls in March, replicating a victory of similar proportions in Melaka last November.
Umno president Zahid is keen for elections to be held this year to ride on this momentum.
But Ismail - the party's third-highest ranked leader and Malaysia's first prime minister who is not concurrently leader of his party - leans towards a 2023 election to deal with the surging inflation in Malaysia.
Teoh added: "I think what any government going up into the next election should be campaigning - not just in the interest of the country but even in the interest of your own party - is about what you can promise people economically.
"I think that's the first question that would be on their minds... How is the government going to protect my livelihood, my financial situation."
Shahril had last month (June) also told ST in a separate interview that addressing living costs and subsidies of Malaysia's electorate were likely to be key talking points at the coming election.
Malaysia's ringgit hit record lows against the US and Singapore dollar this year, exacerbating an already-weakening purchasing power as the rise in food prices has hit an 11-year high of 5.2 per cent this year.
Responding to a viewer's question on the prospect of former premier Najib Razak making a comeback as prime minister at the upcoming election, Shahril sidestepped the question and dismissed candidates other than the incumbent as "speculation".
"I think, you know, it's clear that our PM candidate is Ismail Sabri," he said. "That's something that has been repeated by the party leadership time and again."
Najib, who is appealing against his graft conviction for his role in the 1Malaysia Development Berhad scandal, remains an influential Umno member and ally of party president Zahid, who is also facing corruption charges.
While conceding that other politicians have made a comeback after being jailed or convicted, Teoh added: "Maybe post-GE15 (the next general election, which will be Malaysia's 15th) is not the time for Najib to make a comeback, if at all...
"I think in the short term, his influence is very useful for Umno, but I don't think that it would be wise for himself or the party to seriously entertain this idea of him becoming the prime minister again in such a short space of time."
Some key quotes from the webinar discussion:
"This new reform, Undi18 (Vote 18), you get something like 37 per cent more young, automatically registered voters.
If there's a party out there that can excite them, that party is probably going to be in very good shape - it's going to really increase its vote share. So, there are millions of votes out there for the taking." - Teoh, on the potential influence of young voters in the next general election, with the implementation of automatic registration of eligible voters who turn 18.
"For all the questions around Umno solidity and unity, things are probably quite a bit worse on the other side. Not that we take, necessarily, pleasure from it, but that's just the way it is...
"Perhaps the more important reason, which is that the economy requires some firm and brave decisions, that may not be too popular...
"For those couple of reasons, my sense is that the sweet spot is probably (within six months)." - Shahril, explaining his "personal view" on when he thinks the Malaysian general election will be called.
"If you're tracking commodity prices closely, (inflation) seems to come off a bit. There's some kind of promise maybe, that the worst is over.
"And then you might want to wait for these inflationary pressures to taper off and then maybe call an election there. And that might take some time." - Teoh's take that early 2023 may be better timing for the general election.
"We've seen in Melaka, we've seen in Johor, whatever internal tensions that people might speculate would have existed then as well. But what we managed to do in those two state elections and the previous by-elections, was to put those things aside and sort of postpone that conversation, postpone that open debate about difficult questions to after we win an election." - Shahril, on Umno's recent history of putting internal divides aside to win state elections.
"There are other more tricky questions about how we also leverage off Singapore, leverage off Kalimantan, with Indonesia's new shift to have their administrative centre. Those are the things that I think we ought to have clarity on or ought to have a distinctive proposition for, rather than see Singapore and Indonesia as a threat." - Shahril, on Malaysian cooperation with its neighbours to attract investment.
"We have so many interesting and attractive tourist sites, but somehow between the packaging and the marketing... I think we've missed out on that since our Malaysia, Truly Asia thing may be about a decade and a half ago that really worked for a while. But since then, I think other countries have managed to market their destinations quite a bit better." - Shahril, on Malaysia falling behind other regional tourist destinations.
"I think Malaysians think of their own financial health in terms of how much is the ringgit worth in terms of Singapore dollars or US dollars. If it gets small, they say, oh, now my salary is smaller than it used to be...
"A lot of people, I think if they had studied overseas or something, and you asked them, would you come back to work in Malaysia? I don't think it'd be their first option." - Teoh, on the woes of the depreciating ringgit.