Tuesday, July 8, 2008
Political uncertainties bad for business
The Straits Times' issue on July 2 had a screaming headline "Turmoil in KL" - the kind of story that was enough to scare powerful investors who are parked in Singapore. It's the kind of story that will see Malaysia lose more investments. For us in Malaysia, it's another day in Malaysian politics, as much as businessmen detest it. Still, this is the kind of stories that's hitting the headlines all over. We blame no one except ourselves. The Business Times, in the NST today, carried a story quoting the CLSA Asia-Pacific Markets as saying that it has cut its year end target for the KLSE by 15% to 980 points, believed to be the lowest estimate in the market. The foreign research house also downgraded its rating on the Malaysian market to "underweight" from "neutral" citing political uncertainties, inflationary pressures and an economic slowdown. It said "investors have always viewed Malaysia as a politically stable country and a defensive market. However, the current political bickering potrays a negative perception to foreigners that will cause further de-rating," it said. We need to get our act together. Quickly too.