This article first appeared in The Edge Financial Daily on September 14, 2018

KUALA LUMPUR: The ringgit has been one of the best-performing Asian currencies this year, indicating local and foreign investors’ confidence over its relative strength despite a change of the government, Finance Minister Lim Guan Eng said.

In a statement yesterday, Guan Eng said up till Sept 11 this year, the value of the ringgit against the US dollar has dropped by only 2.2% compared with the Australian dollar, rupiah, yuan, South Korean won and Singapore dollar that had weakened by 9.9%, 9.8%, 5.6%, 5.7% and 3% during the same period.

He was commenting on former prime minister Datuk Seri Najib Razak’s remarks on Facebook on Wednesday, which said the ringgit had failed to improve after the change in government in May’s 14th general election in accordance to the rise in crude oil prices.

“Generally, the ringgit would strengthen when oil price is up but you can see that it has dropped 30 sen to RM4.15 now although the price of a barrel is US$78 (RM323.70). I am worried that if crude oil prices dip, the ringgit would be badly hit,” Najib had wrote on his post.

Guan Eng said Najib’s allegations are baseless as the latter had failed to consider that the ringgit’s value is not only determined by crude oil prices.

“He intentionally failed to take into account key factors such as the strengthening of the US dollar, the financial crisis in emerging markets, and uncertainties in the global economy due to the trade war between the US and China,” he added.

Guan Eng also said the Pakatan Harapan government is confident that the value of the ringgit would improve in the medium term as the country’s public debt problem and scandals like 1Malaysia Development Bhd are resolved.