Rubber sector lauds Bank Negara's open dialogue on foreign exchange
Update Date：2016-12-22 9:46:05 Source：Tannet (Malaysia) Sdn Bhd Views：682
KUALA LUMPUR: Rubber exporters have expressed relief over the assurance given by Second Finance Minister Datuk Johari Abdul Ghani that Bank Negara will address exporters' foreign exchange concerns on a case-by-case basis. Malaysian Rubber Glove Manufacturers Association (Margma) president Denis Low Jau Foo said the association is encouraged by the fact that the minister gave his assurance that the central bank is taking a pro-active stance and is open to constructive engagement with exporters’ over concerns. “We look forward to Bank Negara lessening paperwork and the hassle that goes with it. The international business environment is very challenging,” Low told Business Times today. “In the spirit of Malaysia Incorporated, both the government and private sector must work together to remain competitive,” Low added. Effective December 5, 2016, the central bank announced measures to enhance demand for the ringgit in the market. Since then, several sections of the business community have raised pertinent concerns on the implementation. Following a series of meetings, Bank Negara clarified to exporters that bankers must use the same rate on spot or forward basis entered on the same day when exporters convert 75 per cent export earnings to ringgit and reconvert to US dollar to fund their imports. The central bank have also informed exporters who have open contracts denominated in foreign currencies to settle them by end-March 2017. Rubber glove manufacturers are key foreign currency earners for Malaysia as they collectively supply to two thirds of the global supply of the medical device. In 2015, they raked in RM13.1 billion for the economy. In a December 13 letter to International Trade and Industry Minister Datuk Seri Mustapa Mohamed, the American Malaysian Chamber of Commerce (AmCham) said the central bank measures might have implications beyond the immediate intended impact, namely casting “a negative pall on the business environment in Malaysia”. AmCham — which comprises nearly 800 members representing more than 350 American, Malaysian and other international companies — felt that restrictive policies should be applied to speculators and not long-term exporters who have invested in Malaysia for decades. According to the letter, AmCham representatives met with Bank Negara officials on December 7 to present key issues and proposals. When contacted by Business Times, Johari reportedly said he anticipated an administrative impact with Bank Negara's new measures but said the central bank is seeking to facilitate capital flow, and not to curb it. "Bank Negara is flexible as far as the foreign exchange policy is concerned. If any companies feel they are affected by these changes, Bank Negara is capable of handling them on a case-by-case basis," the minister reportedly said, yesterday.
Read More : http://www.nst.com.my/news/2016/12/198531/rubber-sector-lauds-bank-negaras-open-dialogue-foreign-exchange
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