[Saham BSKL melonjak sedikit berikutan pengumumnan penghapuran 10% cukai levi. Tetapi banyak analis berpendapat ia tidak akan daat mengambil hati pelabur yang sudah jeran dengan cara Mahathir menguruskan ekonomi. Ketidak-tentuan politik seperti hubungan Daim-Mahathir turut menjadi faktor keresahan melabur di sini.

Diramalkan tektik levi, krisis Daim-Mahathir dan mungkin juga keputusan pengunduran nama Mokhzani dari 2 syarikat koporat baru-baru adalah untuk mengelakkan BSKL dari menjunam di bawah paras 500 yang amat ditakuti.

Menurut satu kajian oleh International Institute for Management Development di Switzerland, tahap kompetetif global Malaysia kini telah jatuh keparas 29 dari tahap 14 pada tahun 1997.

Analis juga berpendapat dengan levi itu dihapuskan ia menunjukkan petanda besar Mahathir akan terus mengekalkan kawalan matawangnya sebagai perisai keunggulannya (yang sebenarnya tiada). Mungkinkah ia satu perisai terakhir sebelum dia tersadai jua? - Editor]

The Asian Wall Street Journal
3rd May 2001

Malaysia Scraps 10% Exit Tax On Gains for Foreign Investors

By LESLIE LOPEZ and JOSEPH EDWIN
Staff Reporters of THE WALL STREET JOURNAL

KUALA LUMPUR, Malaysia -- Malaysia removed a 10% exit tax on repatriated capital gains for foreign equity-market investors.

The move rescinded the last significant measure imposed on foreign investors in the Kuala Lumpur stock market as part of Malaysia's controversial capital-control policy announced in September 1998.

The government's decision appears to reflect Kuala Lumpur's concerns about steady outflows of foreign portfolio funds and declining foreign-exchange reserves amid speculation over a possible devaluation of the ringgit, which is currently pegged at 3.80 to the dollar.

The Kuala Lumpur Stock Exchange got an immediate lift from the move. The exchange's composite index jumped 4.6% to close at 611.42, its highest level since April 4.

But many economists and investment analysts say the removal of the 10% tax probably won't spark a sustained rush of investments into the Malaysian market. They note that political jitters, particularly over rumors of a rift between Prime Minister Mahathir Mohamad and Finance Minister Daim Zainuddin -- who is on a two-month leave from his post -- are likely to keep investors on edge. "The only upside here is that it removes the threat of the stock exchange's index dropping below 500 points," said a Kuala Lumpur-based fund manager.

Manu Bhaskaran, chief economist at SG Securities in Singapore, said corporate-governance and political issues will continue to cloud Malaysia's economic outlook. But he added that the move to scrap the exit tax illustrates an "encouraging pragmatic streak" in the government and sends a strong signal that Malaysia plans to defend its fixed exchange rate in the medium term.

"Winning confidence among foreign investors is a hard and long climb," said James Lau of SBB Securities Sdn. Bhd. "But this certainly removes a major barrier."

In recent months, there has been widespread speculation that Malaysia will be forced to repeg its currency against the dollar should regional currencies weaken further and, in the process, erode the competitiveness of Malaysian exports.

In a recent survey conducted by the Swiss-based business school International Institute for Management Development that measured global competitiveness, Malaysia slipped to the 29th spot, well below the 14th-place ranking it held in 1997.

Mr. Bhaskaran and other economists say that by removing the exit tax, Malaysia is attempting to show a more friendly face to foreign investors. Combining the removal of the exit tax with the repegging of its currency to a lower level won't be in Malaysia's interest, these economists contend.

Malaysia imposed capital controls in September 1998 with restrictions in the movement of funds held by foreigners as one of its key features. Other key elements of the capital-control policy -- restrictions on the transfer of funds out of the country by Malaysians or foreigners with external accounts and the ringgit peg -- remain in place.

"The abolishment of the levy today is the culmination of a series of gradual steps toward full liberalization, which began in February 1999," the Finance Ministry said. The ministry said the move was decided upon after discussions and consultations with local and foreign fund managers, who found the tax to be cumbersome in terms of administration.

Some analysts said the move is aimed at stemming the dwindling of foreign reserves. "The government is beginning to react, with the hope investor-friendly moves will attract new capital and reverse declining foreign-exchange reserves," said Rajiv Malek senior economist at JP Morgan Chase in Singapore.

In the first two weeks of April, Malaysia reported a net outflow of portfolio funds amounting to $176 million.

Malaysia's international reserves stood at $26.3 billion as of April 14, down 3.3% from $27.2 billion at the end of March. Reserves peaked at $34.5 billion in June 2000.

The central bank said the drop over the two-week period in April was partly because of negative domestic market sentiment, which resulted in "gross outflows."

Write to Leslie Lopez at leslie.lopez@awsj.com and Joseph Edwin at joseph.edwin@dowjones.com.

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Malaysia's Sharp Drop in Exports
Limited Trade Surplus in March

By MONICA HOUSTON-WAESCH
Dow Jones Newswires

KUALA LUMPUR, Malaysia -- Malaysia's March trade surplus of 4.2 billion ringgit ($1.11 billion) was smaller than most analysts had expected, mostly because of a sharper-than-predicted decline in exports.

The national statistics agency released March trade data showing that exports slumped 6.9% from the year-earlier period to 29.8 billion ringgit, far more than the expected drop of up to 4%.

"The weakness will carry on -- we haven't seen the bottom yet," said Rajiv Malik, senior economist at J.P. Morgan Chase & Co. "I don't think we'll see bottom until around the third quarter."

Malaysia is expected to be hit hard by the global slowdown in demand for electronic products, amid slower economic growth in the region and the U.S. Such products usually make up more than half the country's export revenue. In March, electrical and electronic goods accounted for 56.2% of total exports.

However, imports of capital goods, those items used to produce other goods, soared in March, gaining 29.5% to 4.5 billion ringgit, signaling rising consumption despite the lower exports. Capital-goods imports made up 17.6% of total imports.

Like most Asian countries, Malaysia's aggregate trade makes up more than 80% of its gross domestic product.

A local daily newspaper quoted central bank Governor Zeti Akhtar Aziz as saying that economic growth would be about 5% this year, at the lower end of the government's official forecast range. In the past, Mr. Zeti had said growth would likely be around 6%.

Economists welcomed the increase in capital-goods imports as a sign of increased investment activity. Sustained strength could indicate that the economy is being weaned from its dependence upon export-led growth, the economists said, but cautioned that it is too soon to tell.

Analysts are sure to closely monitor the data to better assess whether the sharp rise is due to one-time private investments or marks the beginning of a trend.

"It could also be a reflection of foreign investment approvals last year, which are beginning to trickle in," Mr. Malik said.

Approvals of foreign investment in the manufacturing sector last year rose to a value of 19.8 billion ringgit from around 12.3 billion ringgit in 1999.

For the full first quarter, Malaysia's trade surplus amounted to 13.6 billion ringgit, down 17.7% from the year-earlier period. Exports rose 2.0% to 86.4 billion ringgit, while import growth strengthened to 6.7% to 72.8 billion ringgit.

Write to Monica Houston-Waesch at nikki.houston@dowjones.com

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