When you’re not busy with work or speaking engagements, what’s your favourite way to unwind?
A: I find great solace in quiet contemplation, often with a good book or by engaging in light physical activity such as walking. Spending quality time with my family, away from the demands of my former role, has also become a cherished way to unwind and reconnect.
Do you prefer the city buzz or the calm of the countryside?
A: While the dynamism of a city is undeniable and was certainly a part of my professional life, I have always found a particular tranquility and clarity of thought in the countryside. The calm of nature offers a welcome respite and a chance for reflection that is often difficult to achieve amidst urban activity.
If you could have dinner with any historical figure, who would it be?
A: That’s an intriguing question. I would be immensely interested in having dinner with person who had changed China to what it is today. His insights into economics and moral philosophy laid the foundational principles that continue to influence global economic and financial systems. A conversation with him about economic development and the challenges of economic governance in the modern era would be truly fascinating.
What’s one thing people might not know about you?
A: Perhaps the often perception of the serious nature of my past responsibilities, I have a deep appreciation for the arts, particularly traditional Malaysian music. I find it to be a beautiful expression of our culture and a reminder of the rich tapestry of our heritage.
You led Bank Negara during a period of economic and political turbulence. How did you navigate decisions when the pressures came from all sides?
A: Navigating periods of intense economic and political turbulence demanded a steadfast commitment to the central bank’s core mandate; to maintain monetary and financial stability. The key was always to filter out the noise and focus on robust data analysis, sound economic principles, and the long-term interests of the nation. We built a strong, cohesive team that was dedicated to objective assessment.
While pressures from various stakeholders were inevitable because of various views, our approach was always to base decisions on facts and a deep understanding of the potential implications, rather than succumbing to short-term political expediency. Transparent communication, as much as possible, also played a crucial role in building confidence and understanding.
What personal values or guiding principles helped you stay grounded as a leader?
A: Integrity and a strong sense of public duty were paramount. I always believed that leadership, especially in a public institution, carries an immense responsibility to act with fairness, impartiality, and an unwavering commitment to do the greater good. Humility was also essential; understanding that no single individual has all the answers, and that seeking diverse perspectives and counsel from experts was vital for effective decision-making.
Lastly, a deep-seated belief in the resilience and potential of the Malaysian economy and its people provided a constant source of motivation and optimism, even in challenging times.
Looking back, are there moments where you feel your leadership made the most impact, or where you wished you could have done more?
A: Looking back, I believe the most significant impact stemmed from maintaining the credibility and independence of Bank Negara Malaysia. This was the legacy that I inherited from previous leaders of the central bank. In times of uncertainty, a central bank that is perceived as independent and principled provides a crucial anchor for the economy.
Our efforts to strengthen financial sector resilience and to ensure the stability of the payment systems during challenging periods were also areas where I feel our collective efforts made a tangible difference.
As for wishing I could have done more, there are always areas where one strives for continuous improvement. The complexities of economic management mean that perfect outcomes are rare.
Perhaps more could always be done in terms of public education on complex economic issues, to foster a deeper understanding of policy objectives.
One always reflects on how to better prepare for unforeseen global shocks, but overall, I am proud of the dedication and professionalism of the entire institution during my tenure.
Central bankers often have to make tough, sometimes unpopular decisions. Could you share an example of a particularly difficult decision you made, and how you arrived at it?
A: Central banking inherently involves making decisions that, while necessary for long-term stability, might not be immediately popular. A particularly challenging period involved navigating the impact of significant global economic shifts combined with domestic pressures.
One such difficult decision revolved around the necessity of tightening monetary policy, specifically increasing the Overnight Policy Rate (OPR), during a period when the public and some sectors of the economy were advocating for more accommodative measures.
We arrived at monetary policy decision after extensive analysis of inflation trends, capital flows, and the evolving global economic landscape. While we understood the immediate concerns of businesses and households regarding higher borrowing costs, the data clearly indicated that allowing inflationary pressures to persist would lead to more severe and prolonged economic hardship down the line, eroding purchasing power and undermining investment certainty.
The process involved rigorous internal debates, detailed economic modeling, and consultation with various stakeholders to understand their perspectives.
Ultimately, the decision was driven by the imperative to safeguard the purchasing power of the currency and to ensure the sustainability of economic growth over the medium to long term, even if it meant absorbing some short-term discomfort.
Transparency in communicating the rationale, explaining the ‘why’ behind the decision, was crucial in managing public expectations, even if the decision itself remained unpopular with some segments.
How do you strike the balance between long-term policy goals and short-term political or social pressures?
A: Striking this balance is arguably the most critical and delicate aspect of central banking. The core of it lies in unwavering adherence to the central bank’s mandate, which is inherently long-term oriented – price stability, financial stability, and promoting sustainable economic growth.
The central bank approach had always been anchored in several principles: Data-Driven Decision Making, Strategic Communication, Institutional Independence, and Pragmatism within Principles.
The balance is achieved by consistently prioritizing the long-term health and stability of the economy, knowing that short-term concessions can lead to greater problems in the future.
It requires conviction, a deep understanding of economic principles, and the courage to make difficult choices for the nation’s lasting benefit. And courage is an extremely important character of a central banker.
How do you see fintech, digital currencies, and new financial technologies reshaping the Malaysian financial landscape?
A: Fintech and new financial technologies are undoubtedly transformative forces that are already reshaping the Malaysian financial landscape, and this evolution will only accelerate. We’ve seen significant progress in areas like e-payments, which enhance efficiency and financial inclusion by reducing transaction costs and improving accessibility.
Digital currencies, while still evolving, hold the potential to further revolutionize payment systems and even the very concept of money, bringing both opportunities for greater efficiency and significant challenges for regulators.
The reshaping occurs on several fronts; increased efficiency, new business models and competition, enhanced data utilization, the emergence of digital currencies, and heightened cybersecurity risks.
Overall, it’s a dynamic and exciting space, demanding continuous adaptation from both financial institutions and regulators.
What advice would you give to policymakers on maintaining financial stability while pushing for growth?
A: This is the perennial challenge for policymakers, and the two objectives of sustainable growth and financial stability, while distinct, are inextricably linked. Sustainable growth cannot occur without financial stability.
There are a few imperatives; Prudent Macroeconomic Management, Robust Regulatory Frameworks, and Targeted Structural Reforms for growth.
Policymakers should also promote financial inclusion and literacy and establish proactive risk identification and mitigation systems.
Ultimately, it requires building strong foundations – resilient institutions, sound policies, and a skilled workforce – that can withstand shocks and capitalise on opportunities to deliver sustainable and inclusive prosperity.
Malaysia has recently been engaged in complex trade negotiations with the US. In your view, what are the trade-offs of these negotiations? Are we negotiating from a position of strength?
A: Complex trade negotiations with a major economic power like the US always involve significant trade-offs.
The primary benefit Malaysia seeks is continued access to a crucial market for our exports, but these benefits often come with demands for market liberalisation in areas that might impact sensitive domestic industries, policies or require adjustments to our regulatory frameworks.
As for whether we are negotiating from a position of strength, it’s a nuanced assessment. Malaysia has several strengths, including our strategic location and our role in global supply chains (especially in semiconductors) and membership of trade blocks.
However, the sheer economic size and influence of the US mean that any negotiation will inherently involve power asymmetry. Our negotiating strength lies in our unity, our clear articulation of national interests, and our ability to demonstrate the mutual benefits of a robust trade relationship, rather than solely relying on our economic scale.
The recent reports of impending tariffs indicate a challenging environment, but Malaysia’s firm stance on protecting its core interests, even if it means drawing a ‘red line,’ shows a principled approach.
How should Malaysia navigate tensions between the US and China while protecting its own economic interests?
A: Navigating the escalating US-China rivalry is perhaps the most significant geopolitical and economic challenge not only for Malaysia but also for the whole world.
Our approach must be one of active neutrality and economic pragmatism. This means diversifying our economic ties, focusing on multilateralism through platforms like Asean, and enhancing Malaysia’s value proposition to both powers as a reliable partner.
It’s about maintaining good relations with both, seeking economic benefits from both, without taking sides in their strategic competition.
Ultimately, the best defence is a strong, vibrant and resilient domestic economy.