Photo by Shahrin Yahya/The Edge

KUALA LUMPUR (March 19): The government has no plans to peg the ringgit at this time, said Finance Minister II Datuk Seri Amir Hamzah Azizan.

He said looking at the pegging of the ringgit around 1998, the economic condition at that time was different compared to the current condition.

He explained that in 1998, the stock market had plunged by 76%, but now from the start of this year, the stock market had risen 6%, while foreign debt in 1998 was more than 16% of gross domestic product, but currently, it is only 2% or 1%.

“Hence, if we look in terms of international reserves, Bank Negara has reserves of more or less US$114 billion; it’s much better at US$26 billion [recorded] in 1998.

“Therefore, [there is] no need for us to react hastily. The government is indeed sensitive to the issue of the ringgit, and will strive to address it,” he said during a question-and-answer session in the Dewan Negara on Tuesday.

Amir Hamzah said analysts also opined that the ringgit will stabilise this year to a better level, and possibly to the 4.50 level against the US dollar.

“Under the Madani Economy framework, we believe the ringgit will perform better in the future,” he said.

He was replying to a supplementary question from Senator Tan Sri Mohamad Fatmi Che Salleh, who wanted to know if the government is planning to peg the ringgit to control or safeguard the country’s assets.