PETALING JAYA: Investor confidence in Malaysia will take a hit as they wait for the outcome of the general election, economists said.
They said whoever forms the next federal government will have to devise clear policies and send the right signals, economically.
Should a similar government to the current coalition arise, a fractured cabinet will also put off many investors, they said.
“The broader aspects (of whether to invest), will be driven by the current economic conditions and expectations, rather than on the influence of politics.
“Decisions, especially for significant and large investments, will be put on hold.
“Investments that are deemed exposed to political risk or how a change in government could have an impact on the country’s economic outlook and expectations, will also be put on hold,“ Sunway University economist Yeah Kim Leng told The Malaysian Insight.
Meanwhile, Lim Kim Hwa, fellow in finance at the University of Cambridge Judge Business School, also echoed similar sentiment that in the short term, investors’ confidence will be affected.
“However, should one party win a clear majority, this would clear a lot of the investors’ concerns,” Lim said.
Prime Minister Ismail Sabri Yaakob dissolved parliament on Monday after receiving the consent of Yang di-Pertuan Agong Al-Sultan Abdullah Ri’ayatuddin Al-Mustafa Billah Shah.
