SINGAPORE: The 13th general election (GE) is unlikely to result in major changes in Government policy and is not likely to have much impact on financial markets.
AMP Capital head of investment strategy and chief economist Dr Shane Oliver said investors preferred political stability and the election was a fact of life they had to get used to.
“Sometimes, just before the elections in other countries, there can be a bit of nevervousness, so maybe that explains the fall in Bursa Malaysia prior to the announcement of the dissolution of the Dewan Rakyat,” he told Bernama.
Prime Minister Datuk Seri Najib Tun Razak on Wednesday announced the dissolution of the Dewan Rakyat to pave the way for the 13th GE.
Meanwhile, ABN AMRO senior economist Maritza Cabezas said political developments had been taken into consideration in an overall assessment of any country.
“Elections are part of a democratic process. In the aftermath, however, both the ruling party and the opposition would likely work in favour of building a more resilient economy, and one of the conditions is supporting a stable political climate,” she said.
She said the GE would probably be the most-contested in Malaysia’s history. “It would be done in a peaceful manner, giving signs of a consolidated democracy,” she added.
Cabezas said investors were mainly looking for clear signs and a strong mandate.
“Both Najib and the opposition would have to show that they were capable of maintaining a pace of reform that was credible and meaningful to investors both in Malaysia and abroad,” she noted.
She said Najib had his ambitious Economic Transformation Programme as an important platform, allowing Malaysia to become a high-income economy by 2020. — Bernama
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