Monitor

All the News of the World Mahathir introduces exchange controls in Malaysian markets

CAPITAL CONTROLS are being recognised as a respectable option for governments wanting an effective policy instrument to prevent further financial turbulence. Malaysia is the first affected Asian country to take the measures of exchange controls. Its decision should be welcomed as an effort to break through the maze of crises. If the Malaysian policies succeed, we can expect others to follow in its footsteps - if the IMF allows them to, that is.

The Star, Malaysia

DOOMSDAY SCENARIOS for Malaysia are everywhere being drawn, the most common conclusion being that now Dr Mahathir has fenced the country off from the outside world, genuine investors will no longer bother with it. If Mahathir is using these drastic measures to put his house in order, before reopening to the outside world with stronger regulations in place, he may yet have the last laugh. Only time will tell. What matters most is that the regional financial turmoil which has taken a heavy toll will not bring about social disorder. The moves, contrary to IMF prescriptions, may be what the country needs at this stage.

Hong Kong Standard

THE SHOCKING measures announced by the Prime Minister, Datuk Seri Dr Mahathir Mohamad, to peg the ringgit at a fixed rate to insulate the economy from further external vulnerabilities, is hitting the nail right on the head. It is absolutely right to control currency speculation. The bold move will definitely strengthen the value of the ringgit and restore the economy speedily.

Sarawak Tribune, Malaysia

CAN SUCH drastic and unorthodox measures stop the economy from sliding into a slump? The truth will be known in the critical days ahead. Dr Mahathir hopes that Malaysia can be sheltered from the turbulence that has roiled the world's financial markets. But interference with the free movement of capital has its costs, and there is no certainty that the new measures will solve Malaysia's economic crisis. Everything depends on how the measures are implemented. Malaysia had better pray that they succeed. If not, there is much to lose. These are a supplement to reforms, not an alternative. Dr Mahathir should remember that.

Straits Times, Malaysia