Too Early To Predict Possible Downside Risks Of Trump's Win On Malaysia's Economy, Says Governor

By Zairina Zainudin & Ahmad Syamil Mohd Ashri KUALA LUMPUR, Nov 11 (Bernama) -- It's too early to predict the possible downside risks to Malaysia's economy following Donald Trump's victory in the US presidential election, said Malaysia's Central Bank (BNM) Governor, Muhammad Ibrahim. However, the Governor gave an assurance the central bank was well-prepared to face the risks. "We must always be resilient to absorb any external shocks. As an economy, we have always been supportive of trade deals and the process of globalisation. "We have prepared our industries and people for all the changes brought by the increase in globalisation," he said when asked what would be the downside risks to Malaysia following Trump's victory. Muhammad said this reporters after the announcement of 4.3 per cent growth in Malaysia's economy for the third quarter of this year here Friday. He said the country's economy would still be positive should the Trans-Pacific Partnership Agreement (TPP) be scrapped by Trump. "If the TPPA were to be dropped, the Malaysian economy would not be greatly affected as we were already performing well before the agreement even came into light," he said. Trump has voiced strong objection towards the pact during his presidential campaigns. The pact, led by the US, involves 12 countries including Malaysia. The world's largest trade pact is seen as a 'game-changer' to global trade. The Governor said the reasons to join the pact were trade boost as well as to increase foreign direct investment. As of now, he said, BNM was closely monitoring Trump's moves. "Should adjustments are needed to protect our economy, BNM would do them accordingly," he said. BNM Deputy Governor, Sukudhew Singh, said at this stage, the TPPA countries were negotiating on whether the pact should be abolished. "There is a general sense of passiveness, even though the chances of it passing looks slim. We have to wait and see," he said. Earlier, Muhammad said, the Malaysian financial system was resilient and was expected to be maintained in the period ahead. He said the economy was expected see between four and 4.5 per cent growth this year. "While businesses and households continue to adjust to the more challenging operating conditions and higher cost of living, this adjustment is expected to have modest impact on financial institutions' earnings and asset quality. "The Malaysian financial system, supported by strong capital and liquidity positions, is well-positioned to continue performing its intermediation function in an effective and efficient manner," he said. -- BERNAMA