ID :
99054
Sat, 01/09/2010 - 18:47
Auther :
Shortlink :
https://oananews.org//node/99054
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ECONOMIST SEES RETURN OF FOREIGN FUNDS
KUALA LUMPUR, Jan 9 (Bernama) – Although foreign funds are back in the
country’s equities market amid the strengthening global and domestic economy and
fundamentals, concerns over the political and social situation still exist, a
forum was told Saturday.
Maybank Investment Bank’s chief economist, Suhaimi Ilias, said foreign
investors' participation in Malaysia’s capital market was only 40 per cent
previously.
"(But) it is now increasing steadily," he said at the Market Chat 2009/2010
Road Show here Saturday.
Asia Alternative Asset Partners Ltd’s chief executive officer, Paul Smith,
however, cautioned that there were still concerns, especially about the
political and social situation in the country.
He said increasing crime rate was one of them.
"Malaysia is competing with the rest of Asia. So, it has to make itself as
attractive as possible as the draw for most international investors is currently
North Asia rather than South-East Asia," he said.
Smith said South-East Asia has become somewhat a backwater and the capital
controls, imposed for many years now, had made it harder for international
players to get back into the market in a substantial manner.
Founder/chief executive officer of Geomatrix Group, Robert Howe, said in
terms of hedging, there was a need for a futures market that has more than 5,000
contracts traded a day.
However, there was a "slight improvement" in the KLCI futures market, he
said.
Suhaimi said Maybank Investment expected the FTSE Malaysia Exchange Kuala
Lumpur Composite Index to touch 1,410 level by end-2010.
Maybank Investment Bank's chief executive officer/director, Mohammed Rashdan
Mohd Yusoff, said it was working closely with Bursa Malaysia to ensure further
improvements in liquidity by creating grater trading ease especially for online
trading, as well as introducing innovative products.
Meanwhile, Suhaimi, in a research paper, said Malaysia’s real gross domestic
product was expected to rebound by 4.5 per cent in 2010 compared with an
estimated –2.2 per cent in 2009.
"(This growth) is expexted to be driven by the pick-up in consumer spending,
recovery in exports and gross fixed capital formation, as well as positive
inventory adjustment, resulting in a broad-based growth in all economic
sectors," he said.
On foreign direct investment (FDI), Suhaimi said there was a prospect of
higher FDI from China over the medium term, especially in energy-intensive and
energy-related projects like the aluminium smelter, pulp and paper mill and
hydroelectric power dams in Sabah and Sarawak.
He said Central Bank of Malaysia’s policy to focus on ensuring adequate
costs
and availability of domestic liquidity and funding, was the reason for the
Overnight Policy Rate remaining at two per cent throughout 2010.
Suhaimi said the ringgit was expected to appreciate against the greenback
amid protracted volatility in the global currency market.
-- BERNAMA
country’s equities market amid the strengthening global and domestic economy and
fundamentals, concerns over the political and social situation still exist, a
forum was told Saturday.
Maybank Investment Bank’s chief economist, Suhaimi Ilias, said foreign
investors' participation in Malaysia’s capital market was only 40 per cent
previously.
"(But) it is now increasing steadily," he said at the Market Chat 2009/2010
Road Show here Saturday.
Asia Alternative Asset Partners Ltd’s chief executive officer, Paul Smith,
however, cautioned that there were still concerns, especially about the
political and social situation in the country.
He said increasing crime rate was one of them.
"Malaysia is competing with the rest of Asia. So, it has to make itself as
attractive as possible as the draw for most international investors is currently
North Asia rather than South-East Asia," he said.
Smith said South-East Asia has become somewhat a backwater and the capital
controls, imposed for many years now, had made it harder for international
players to get back into the market in a substantial manner.
Founder/chief executive officer of Geomatrix Group, Robert Howe, said in
terms of hedging, there was a need for a futures market that has more than 5,000
contracts traded a day.
However, there was a "slight improvement" in the KLCI futures market, he
said.
Suhaimi said Maybank Investment expected the FTSE Malaysia Exchange Kuala
Lumpur Composite Index to touch 1,410 level by end-2010.
Maybank Investment Bank's chief executive officer/director, Mohammed Rashdan
Mohd Yusoff, said it was working closely with Bursa Malaysia to ensure further
improvements in liquidity by creating grater trading ease especially for online
trading, as well as introducing innovative products.
Meanwhile, Suhaimi, in a research paper, said Malaysia’s real gross domestic
product was expected to rebound by 4.5 per cent in 2010 compared with an
estimated –2.2 per cent in 2009.
"(This growth) is expexted to be driven by the pick-up in consumer spending,
recovery in exports and gross fixed capital formation, as well as positive
inventory adjustment, resulting in a broad-based growth in all economic
sectors," he said.
On foreign direct investment (FDI), Suhaimi said there was a prospect of
higher FDI from China over the medium term, especially in energy-intensive and
energy-related projects like the aluminium smelter, pulp and paper mill and
hydroelectric power dams in Sabah and Sarawak.
He said Central Bank of Malaysia’s policy to focus on ensuring adequate
costs
and availability of domestic liquidity and funding, was the reason for the
Overnight Policy Rate remaining at two per cent throughout 2010.
Suhaimi said the ringgit was expected to appreciate against the greenback
amid protracted volatility in the global currency market.
-- BERNAMA
