By Callistus Anthony- Prime Minister Anwar Ibrahim is making great strides in reforming the governance architecture of the country, and this is in turn making Malaysia more attractive towards investments of variou sorts which will grow her economy. Malaysia is now slowly being seen as an attractive investment hub for the tech and high-tech manufacturing sectors, with even the likes of the highly regarded Financial Times paying tribute to the progress made.
As part of the reform, it is time for Bank Negara (BNM) to be made independent as is the case with central banks in countries which has reformed its economic superstructures to be independent of partisan political influence. BNM must be sitting outside of the interests of the commercial objectives of commercial financial institutions in order to ensure that it can objectively and
independently promote monetary and financial stability.
BNM should report to Parliament directly and not to any executive authority such as the Ministry of Finance. As a regulator which should be exercising supervisory jurisdiction to ensure the safety and soundness of individual financial institutions and to monitor their impact on the financial system as a whole, BNM cannot be or seen to be influenced by powerful financial institutions. It is today acknowledged globally that financial institutions have played an outsized role in the economy in the recent past, with the general public having to pay a price for it. The lessons of the global financial crisis of 2008 have evidently not been learnt
The upcoming budget will be an opportune time for the Prime Minister to put into motion steps which will make BNM independent from executive oversight and instead transfer such oversight to the legislature. We can expect financial institutions in Malaysia to oppose this, as they have grown accustomed to having it their way. The must be political will on the part of the Madani government to carry such a change through.
This is one measure which every side of the political aisle in Parliament should come together on, where the interest of the rakyat should be made a priority. Let us recognize that banks serve as custodians of public finance and should be accountable to the public.
Where we refer to reforms, it must be tangible and benefit the people of the country. It is time to move beyond rhetoric and tokenism to make structural reform matter in the real sense.
CALLISTUS ANTONY D’ANGELUS INTERNATIONAL LABOUR ADVISOR SOCIAL PROTECTION CONTRIBUTORS’ ADVISORY ASSOCIATION MALAYSIA (SPCAAM)
Views expressed here are the authors own and does not reflect the opinion of the platform or the editors.
