NAJIB CONFIDENT ECONOMIC ENVIRONMENT WILL IMPROVE

From Mokhtar Hussain

SHARM EL-SHEIKH (Egypt), July 15 (Bernama) -- Malaysia believes that with
further collaboration with the Gulf states it can share knowledge and expertise
in Islamic finance to help improve the current economic environment.

As such, Prime Minister Najib Razak has called for closer cooperation
between the Gulf states and Malaysia to promote the Islamic financial system for
a more holistic approach to long-term economic development.

"The states, with their financial resources, and Malaysia, with the
knowledge and expertise in Islamic finance, provide a natural match and synergy
for closer cooperation.

"We must use the opportunities available to us, even in these difficult
times, to strengthen our economies and emerge stronger when the global economic
environment improves.

"I am very confident that it will surely improve, just as the sun will rise
again tomorrow," he said in his article on "Playing Our Part in Building a
Safer, Prosperous World" published by the Egyptian Gazette newspaper Wednesday.

The prime minister is here to attend the 15th Non-Aligned Movement (NAM)
summit which was officially opened by Egyptian President Hosni Mubarak
Wednesday.

Najib, who is also finance minister, said that in the wake of the current
crisis and the failure of the conventional banking system, there was increased
interest in Islamic finance.

He said Malaysia, a leader in this area with some 60 per cent of the world's
issuance of 'sukuk' (Islamic bonds) originating from Malaysia last year, was
prepared to share its expertise for the greater and common good of the Muslim
world.

He said the Securities Commission (SC) and the Dubai Financial Services
Authority (DFSA) had agreed to allow cross-border distribution and marketing of
Islamic funds between Malaysia and the Dubai International Financial Centre
(DIFC).

Najib said it could be strengthened with the establishment of an economic
council between the Gulf states and Malaysia.

He said it would offer far-reaching benefits to members as well as other
countries in the two regions -- Southeast Asia and the Gulf region -- and
between Asean and the Gulf Cooperation Council.

"One of the most important lessons to be learned from the ongoing economic
crisis is that we must never be boxed in by orthodoxy in economic matters, but
focus more on what works, what is needed and what will best serve the long-term
needs of our people," he said.

He said that in Malaysia, there have been criticisms from those who wanted
to defend the status quo or ignore the different times we lived in.

"But without these policies, Malaysia would be left behind, ill-equipped to
compete in the high-value economic sectors of the future that will propel
Malaysia into the higher income group," he said.

On NAM, he said that though the organisation was set up under a very
different political and economic environment, the challenges it faced today were
no less important.

"The Cold War may be over but we are confronted with the most severe
economic crisis in decades, new international security threats that strain
relationships and questions about shifts in economic power across regions and
between peoples," he said.
-- BERNAMA