KUALA LUMPUR: The Pakatan Harapan government must provide more clarity on its succession plan for the prime minister’s post in order to raise investor confidence in the economy, according to tycoon Ho Kwon Ping.
Speaking at the Invest Malaysia forum, Ho pointed out that it was still unclear on the exact timeline for Tun Dr Mahathir Mohamad to hand over the premiership to his successor.
Ho, who is also founder and executive chairman of Banyan Tree Holdings, said investors could be hindered from investing in Malaysia if uncertainties in the country’s political scene continued.
“Uncertainty is the one thing that businesses are most concerned about, particularly in foreign direct investment. For longer-term investments, people would want to see how the situation over succession is played out.
“The initial euphoria over the change of regime in Malaysia has been very positive. But as you go on longer with this lack of clarity as to when succession will take place and what will be the nature of the succession, foreign investors’ sentiment will decline because there will be more uncertainties,” said Ho.
However, political uncertainties aside, Ho said the Malaysian economy has been performing well amid the global macroeconomic headwinds and growth slowdown.
Dr Mahathir has said several times previously that he would honour his words to pass the baton to Port Dickson MP Datuk Seri Anwar Ibrahim in two years’ time. However, no exact date has been given by Dr Mahathir or Pakatan Harapan so far.
Maybank Kim Eng senior economist Chua Hak Bin said investors have turned more positive on the Pakatan administration, given its track record over the last 10 months since the 14th general election last year.
“I think most investors are now more convinced that the Malaysian economy is resilient. However, moving forward, we need some growth catalysts,” he said.
Among the key economic growth areas that the government could place more emphasis are tourism and the digital economy, said Chua.
He pointed out that the Malaysian tourism industry has been lagging behind its regional peers, in terms of visitor arrivals.
“Malaysia’s visitor arrivals fell in 2018. The government should explore new ways to increase the attractiveness of Malaysia as a popular tourist destination, especially with the Visit Malaysia initiative in 2020.
“As for the digital economy industry, Malaysia’s online sales penetration rose to 3.8% in 2018, higher than several other regional countries such as Thailand, the Philippines and Indonesia. Going forward, there must be continuous effort to further capitalise on the potential of digital economy and e-commerce,” said Chua.