Isu berat ni: Najib jadikan kita hamba US Federal Reserve

Ariff: Najib made us slaves to the US Federal Reserve

FMT Reporters

 | November 8, 2015

Raub MP claims agreement signed allowing US Federal Reserve regulators to monitor Bank Negara.

KUALA LUMPUR: The federal government has been accused of giving up Malaysia’s independence and turning Bank Negara into a branch of the US Federal Reserve central banking system.

In a blog column today, Raub MP Ariff Sabri Mohd Aziz came to this conclusion because of Bank Negara’s decision two weeks ago to accept deposits in US dollars.

Bloomberg reported on Oct 30 that Bank Negara had started taking in small amounts of interbank dollar deposits in September, for the first time, to try and slow a slide in the foreign exchange value of the ringgit, which dropped to a 17-year low against the dollar.

Bank Negara’s foreign exchange reserves fell below US100 billion in July, fuelling speculation that that the central bank was selling dollars to help prop up the ringgit. The reserves have since recovered to US94 billion, but are still down by 19 percent.

Ariff said that the Bank Negara decision was because “we have signed up an agreement with the USA that Bank Negara can accept USD deposits. This effectively makes our Bank Negara a branch of the Federal Reserve Bank of USA. We have lost our independence.”

He said the bank decision meant that US government officers – financial regulators, financial experts of all sorts and FBI officers – would be stationed or could go into Bank Negara to monitor all movements of US dollars.

Ariff did not cite any source for his information about the purported agreement, nor about the power of US government officers to monitor Bank Negara’s activities, but concluded that the Bank Negara decision had turned the central bank into “a stooge to the US Federal Reserve and by extension a puppet to Uncle Sam”.

He attributed the decision to the prime minister, Najib Razak, of having “compromised himself in so many ways”. Najib is concurrently the finance minister, with oversight over Bank Negara.

“Maybe the price of having Uncle Sam keeping quiet about all his transgressions is becoming a modern slave to the USA,” Ariff said, making an indirect reference to a New York Times report implicating Najib in a grand jury investigation into kleptocracy in foreign countries. There has been no confirmation of the report which relied on unnamed sources.

Two weeks ago Bank Negara said in response to the Bloomberg report that the decision to accept interbank US dollar deposits was to ensure sufficient dollar liquidity in the financial system to meet the needs of businesses and households.

Domestic and foreign banks were being encouraged to “recycle the foreign-currency earnings and deposits of local corporations in the domestic markets to ensure continuous and sufficient level of liquidity”, the Bank said in a statement.

Repatriation of profits by foreign investors, slower growth in China and the prospect of higher US interest rates have also spurred large capital outflows, which have placed the ringgit under higher pressure.