How not to help the Malaysian ringgit
In the digital media age, one of the easiest ways to boost one’s self-esteem and establish a guise of being accomplished and authoritative is through questioning the way how other people handle their business.
It’s quite easy – throw in a couple of words like fiat, BRICS, PISA and bitcoin, and voilà, you transform into an economic and education expert, an overall fighter against the system.
In Malaysia, few are easier targets of this self-indulgent exercise than the education system and the economy. Today, everybody, I mean everybody, seems to have an opinion on the ringgit.
“Why is the ringgit so weak? It’s so simple. Just follow BRICS, lah. It can’t be more apparent than that … it’s so obvious,” a friend exhorted over a wedding kenduri (reception).
I just knew he had something important, world-changing even, to share by the way he walked across the community hall towards me. This friend of mine dropped out of a diploma programme many years ago, but in recent times, has become the pre-eminent scholar in economics, epidemiology, global cabal, monetary system, and digital currency, all at once, in my kampung WhatsApp group.
Laymen like him, no matter how big of a burden they think they carry for the rest of humanity, are relatively harmless. The same can’t be said of some experts who are in mainstream media, suggesting solutions for the ringgit.
Apart from financial market professionals, the general tone of opinions is negative, gloomy, and yet positively all-knowing. Worse are the opinions offered by some supposed experts who have no obvious point other than a regurgitation of general knowledge.
Reducing imports is one way, several of these experts say. What do you think the government has been trying to do these past five decades? Many also suggested that the central bank “do something” to strengthen the ringgit, and a person with a PhD even suggested that the central bank should manage our money more smartly, whatever that means.
More than a few opinion pieces also suggested that we improve our “competitiveness” without ever clarifying what that means, or by pointing to the general direction of the education system.
Well, let me help you here. If the exchange rate in the long term is determined by the demand and supply of foreign exchange, it follows that the ringgit will increase in value vis-a-vis other currencies if outsiders want more of what we produce.
Now, imagine a world where knowledge and its bearers are a product in the global economy, just like cars. If all that we produce and export is economic opinion pieces, what would be the world demand for this commodity? Would generalism, text book explanations or ChatGPT-generated lines be useful enough in South Africa, Egypt, or Japan, that they would sell their rand, pound, or yen, in exchange for ringgit to acquire this commodity?
That’s how we should imagine competitiveness in the world – a level of practical usefulness, brilliance or technical ability, not general knowledge, which is commonplace and neither here nor there.
In 2024, the shortage of ideas is not a major impediment to our nation’s progress. But the preoccupation of learned people, many with degrees and even PhDs, with the way things should be, and by conflating identification with solution, if not a headwind, is a terrible waste.
We don’t need more people to point at obvious situations, we need doers to take whatever it is they are doing to another level.
Apart from being unproductive, this self-realisation as an expert through media phenomena tends to mislead the public. If we keep on indulging in the idea of being clever in whatever, and all problems have a solution within the first two Google results, over time, the population will come to expect that all economic policies and reforms choices are always without any trade-offs, and that change can be affected overnight.
Casual general comments by so-called experts, which in some ways reveal amateurism, also undermine institutions. If you have a problem with how monetary policy is conducted, you should argue in terms of monetary economics, and not in terms of organisational management.
Global competitiveness doesn’t demand our best, it usually asks for more. It’s the standard by which the world expects you to perform. If you want to elevate Malaysia’s competitiveness, be more than the best teacher, MP, e-hailing driver, civil servant, journalist, banker, machinist, footballer, or economist you think you can be.
And self-restraint is part of this standard. Refrain yourself, because if enough supposed experts make dubious suggestions about our currency, then the world may just believe it deserves to be where it is.
The views above are the author’s own and in no way reflect the views of his former and current employers in the financial industry and academia.
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