KUALA LUMPUR, Oct 17 — Vietnam and Cambodia will soon join their regional neighbours in trading with Malaysia using the ringgit, Prime Minister Datuk Seri Anwar Ibrahim told the Dewan Rakyat today.
During Prime Minister’s Question Time, Anwar said this is an encouraging development although there has yet to be any next course of action from other countries.
“Vietnam and Cambodia have given their acknowledgement though the Local Currency Settlement Framework which was inked through the Asean Agreement meeting recently held in Jakarta,” Anwar told the Parliament here.
He was responding to a question asked by Umno’s Parit Sulong MP Datuk Seri Noraini Ahmad who asked what were the government’s latest plans on de-dollarisation to encourage more trade done in ringgit.
“We have just inked the Asean Agreement this year so that countries like Vietnam and Cambodia can be with us. In terms of our highest trade, it is with Singapore — 15 per cent — but as a trade country, Singapore has not shown much keenness to use our local currency.
“And the second highest trade country is China — 13.8 per cent. China is among the most active in welcoming [the approach[, and this is both the country and private sectors. Except when the country is involved in other international trade, it becomes a challenge for them to take into account external interest only,” he said.
As for Japan and Hong Kong, Anwar said there was no interest.
This comes as Anwar also said that close to RM60 billion of trade transactions with China, Indonesia and Thailand have been done in ringgit.
Anwar said of the three countries, China recorded the highest transaction of RM39.2 billion — which made up 25 per cent of Malaysia’s total trade with the country.
"This means that the 25 per cent of trade absolutely does not depend on the US dollar. In terms of this, China is the most successful,” Anwar said, referring to the de-dollarisation policy.
As for Indonesia, it recorded 16.7 per cent of transactions done in ringgit (RM10.7 billion) followed by Thailand (19.6 per cent or RM8.2 billion).
Last week, Anwar said he had invited several countries such as Indonesia, Thailand and China to use the ringgit while trading with Malaysia during the Asean Summit held in Jakarta, Indonesia.
In September, he reportedly said trading in local currencies is not new, pointing out that it has also become part of the international financial architecture after the economic crisis of the late 1990s.
In May after ringgit reached a six-month low, Bank Negara Malaysia said the sharp depreciation of the ringgit versus the US dollar was in line with a larger decline of regional currencies against the greenback.
