The Malaysian Prime Minister, Dr Mahathir bin Mohammed, has said governments who fail to act against currency speculators should be thrown out of office. "Governments who say they can't act against them should either resign or be thrown out," he declared at the World Economic Forum in Davos.
Dr Mahathir has been a strong critic of currency traders, blaming them for the recent crisis in the Malaysian economy. He compared them to arms traders, saying their actions were no less lethal than rockets and bombs. Dr Mahathir also ruled out any early lifting of the currency controls imposed during last September's financial crisis until the international community devises a means of curbing the currency traders.
He suggested traders should be registered in countries in whose currency they are operating so that "they will behave like good boys", their activities should be transparent, and there should be a ceiling on their borrowing of twice their capital assets.
According to Dr Mahathir, Malaysia will "bounce back" from the current economic crisis without having to call on IMF loans. He strongly defended the imposition of what he termed "selective currency controls", saying that the country would have gone bankrupt without them.
In the past four months, he said, his country's reserves had risen by 35 per cent to $27 billion, shares prices were up and inflation had increased by only 1.5 per cent. "All indicators show an economy in recovery," he said.
Dr Mahathir was also strongly critical of the IMF, the World Bank and United States. He said the US had squeezed credit and shortened loan repayment times during the crisis. He also blamed the western media for presenting the currency controls as an attempt to protect the interests of Malaysia's ruling elite, including his own family.
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