Introduction of a new currency may raise confusion - Experts
NOR SYAMIRA LIANA NOR ASHAHA
SHAH ALAM - Proposing the introduction of a new currency at the state level is not a prudent approach to addressing the country's economic crisis.
A banking lecturer specialising in Islamic finance at the Faculty of Economics and Muamalat, Universiti Sains Islam Malaysia (USIM), Dr. Mohd Faisol Ibrahim, argued that such a move could have detrimental effects on the economy of the concerned state.
Mohd Faisol emphasised that introducing a new currency would create complications not only within domestic trade but also on the international stage.
"Malaysia primarily uses the Malaysian Ringgit (RM) for its financial transactions, with most investments and trade conducted in RM.
"The introduction of a new currency would raise concerns among foreign traders engaged in import and export relations with the country. They may question the legitimacy and stability of the state's currency, he told Sinar Daily.
Furthermore, Mohd Faisol underscored the necessity for any newly introduced currency to possess substantial backing to establish its credibility.
He warned that without a robust support system, the introduction of a new currency could disrupt trade, leading to adverse effects on the state's and the nation's economic growth.
He also pointed out that the introduction of a state currency is a complex matter that demands comprehensive and well-researched planning rather than a short-term solution.
Recently, Works Minister Datuk Seri Alexander Nanta Linggi envisioned the idea of Sarawak introducing its own currency as a response to the uncertainty in Malaysia's economy.
He mentioned this possibility as one of the measures that could be considered if the national economic situation does not improve.
Nanta Linggi, who is also the Secretary-General of the Federation of the Sarawak Party, stressed the importance of a thorough analysis before implementing such a decision.
He expressed the need to evaluate the overall income, including Sarawak's economic performance, and to assess the quality of people's lives in the state.
"If Sarawak is better than others, why not? This is what I am trying to emphasise. However, when researching per capita income, it turns out there are still areas where people continue to experience poverty.
"But I am serious. If we are so good at developing the economy, by calculation, the national economy should be strong," he said in a special podcast broadcast with Bual Studio and Reka Sound for Merdeka and Hari Malaysia titled 'From Malaya to Malaysia: 60 Years'.
"While considering the introduction of a state currency, we must ensure that Sarawak's economic situation significantly surpasses that of other regions. This is not about betraying the country but rather strengthening our own economy," Nanta Linggi said.
He also said that the state should be cautious and compassionate, recognising that certain areas still grapple with poverty even if we have a strong economy.
