The global economic community should take note of the economic restructuring that Malaysia has undertaken in recent years to enable the country to thrive on domestic demand.

Bank Negara Malaysia (BNM) governor Tan Sri Dr Zeti Akhtar Aziz yesterday said Malaysia used to be an export-led economy in the 1990s but it is no longer so.

“It was driven by domestic demand for more than a decade that saved us. This is why we have 5-6% growth, even in the aftermath of the global financial crisis.

“It is because even though our trade contracted, our domestic demand drove our growth,” Zeti said in an interview on The CNBC Conversation conducted in Hong Kong at the Asian Financial Forum, conducted by CNBC Asia’s Bernard Lo.

To a question that Malaysia did not get enough exposure on its economic restructuring, Zeti said: “I believed that Malaysia, including BNM, would make every effort to do so.”

“But another factor is that we are a country that hasn’t borrowed significantly from the international capital markets.”

On the ability of BNM to stand alone, be independent, and protected even after she leaves office in April, Zeti said she had spent a lot of time and attention on instituting legislations.

“During my term in office we have enacted over 10 pieces of legislations for the financial sector and this gives certainty and predictability.

“Then there was a governance process also instituted in the decision making process and even the selection of the new governor will go through a governance committee of the board made up of private sector individuals.”

On speculation that the frontrunner to succeed her is deputy governor, Datuk Muhammad Ibrahim, Zeti said nothing was done on this matter until the Yang di-Pertuan Agong gives the royal assent.

Zeti, who has been with BNM for 35 years of which 16 years as the governor, was asked if she would feel comfortable taking up a teaching role. “I have been a policymaker and I will always be a policymaker in that sense that I will teach but not take on any jobs.

“We are setting up a business school in partnership with Massachusetts Institute of Technology (MIT) Sloan School of Management in Cambridge, US, and that’s a very exciting project that I will continue to support.”

On a lighter note, when asked if Zeti would be holding beach parties with the Mahathirs or Najibs anytime soon, she said she had always maintained a professional relationship with politicians and also the industry.

“It’s a sacrifice actually for whoever takes on the position of BNM governor because you cannot build up any close relationship with politicians or with the financial industry.

“So who have been my friends? They are actually other central bankers and they will probably be who I will miss the most.”

Source from The Rakyat Post

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