Not enough done on GLCs, open trade, think tank tells govt

IDEAS chief executive Ali Salman.

KUALA LUMPUR: A think tank has urged Putrajaya to focus on delivering economic reforms particularly those related to government-linked companies (GLCs), open trade and public procurement.

Institute for Democracy and Economic Affairs (IDEAS) chief executive Ali Salman said he was concerned that despite Pakatan Harapan’s programme of divestment for GLCs, their total assets still dominated Malaysia’s gross domestic product (GDP).

He said the PH manifesto had pledged to improve the management of GLCs, including stopping the appointment of politicians to the companies, but this had not happened.

“There has been no commitment to the reform of GLCs. The signals coming from the government is that it is business as usual,” he said, adding that the large number of GLCs involved in the economy sent a wrong message to private investors.

Ali said another concern was Putrajaya’s wavering commitment to the Comprehensive and Progressive Agreement for Pacific Partnership (CPTPP).

He said the delay in signing the agreement could cost Malaysia.

“If we don’t sign in six months, it will be too late, we will lose negotiating power,” he said after the IDEAS Public Forum on “The Next Four Years: What Now for Malaysia?” here today.

“Although the inflow of foreign direct investment (FDI) is good news, investors will look for the ratification of CPTPP as a major factor,” he said, adding that Putrajaya should reaffirm Malaysia’s commitment to open trade.

Ali also said that while there were some encouraging reforms in procurement of public projects such as the reduction in the cost of the East Coast Rail Link (ECRL) project, greater transparency was still needed.

“The public only knows that the ECRL has been renegotiated and the cost went down but other details pertaining to the renegotiated terms and conditions, repayments of debts and revenue projections are still unknown.

“The government should clearly explain the details of the cost benefit analysis. The public should know where the government would spending their tax money in future.”

On the rising cost of living, Ali said the government cannot continue to keep the prices of goods artificially low.

“The major job producers are small and medium enterprises (SMEs) and 90% of SMEs are involved in services like food, retail, so you cannot expect that to be sufficient to meet the cost pressures.

“We need quality FDIs, more automation, add value to businesses and reskill the work force.

“As long as jobs are paying low wages, any efforts to curtail rising prices will only serve as a short-term strategy,” he said.