Mahathir declares verbal war on speculators<\/p>\n
By Madhav Reddy<\/p>\n
KUALA LUMPUR (Reuter): If words could kill, Malaysian Prime
\nMinister Mahathir Mohamad would have wiped out the speculators
\ncausing havoc in Southeast Asian currencies.<\/p>\n
In the last four days, the tough-talking Mahathir has called
\ncurrency speculators "rogues", "robbers", "anarchists" and
\n"brigands" with a "political agenda" to "destroy all the progress
\nthat we have made".<\/p>\n
"We see a well-planned effort to undermine the economies of
\nall the ASEAN countries by destabilizing their currencies.<\/p>\n
"Our economic fundamentals are good, yet anyone with a few
\nbillion dollars can destroy all the progress that we have made,"
\nMahathir said at the opening of the ASEAN foreign ministers
\nmeeting on Thursday.<\/p>\n
Mahathir, known for his sharp-tongued criticisms of the West,
\nsaid the countries of the region were told they must open up
\ntheir markets and that trade and commerce must be free.<\/p>\n
"Free for whom? For rogue speculators. For anarchists wanting
\nto destroy weak countries in their crusade for open societies, to
\nforce us to submit to the dictatorship of international
\nmanipulators," he said.<\/p>\n
"We want to embrace borderlessness, but we still need to
\nprotect ourselves from self-serving rogues and international
\nbrigandage.<\/p>\n
"We feel that there is some other agenda, apart from making
\nmoney. As you may have noticed, ASEAN countries are the
\ntargets...Thailand, Indonesia, the Philippines (Singapore) and
\nMalaysia," he was quoted as saying by local newspapers on Monday.<\/p>\n
ASEAN, or the Association of South East Asian Nations, also
\ngroups Brunei and Vietnam, and since Wednesday, Laos and Myanmar.
\nMahathir was quoted as telling Malaysian reporters following him
\non a six-day visit to Japan on Monday that a "certain powerful
\nAmerican financier" was behind the speculative attacks.
\nHe said that the American financier, whom he has not named, was
\non a "crusade for charity".<\/p>\n
"It means he robbed from the poor to show he's charitable,"
\nadded the prime minister, who returned to Malaysia on Tuesday.
\nDealers in Singapore and London have named George Soros and his
\nQuantum group as one of those leading the attack on Southeast
\nAsian currencies. Soros also sponsors The Open Society, an
\ninternational humanitarian foundation.<\/p>\n
Apparently not satisfied with calling them names, Mahathir on
\nThursday threatened speculators with possible laws in all of
\nSoutheast Asia to curb speculation.<\/p>\n
His verbal attacks have not cut much ice with speculators, who
\ncontinue to sell down the five major currencies in Southeast
\nAsia, but they have set the tone for possible future retaliation
\nby governments in the region, analysts said.<\/p>\n
"The PM has not said anything that shows there would be
\nconcrete steps taken against speculators," said a dealer with a
\nEuropean bank in Singapore. "But this could mean greater
\ncooperation between ASEAN countries in future."<\/p>\n
Dealers and analysts said a law against speculation may not
\nbear fruit unless the countries resorted to draconian capital
\ncontrols. But it could take the form of a stronger agreement by
\ncentral banks to help each other.<\/p>\n
In the past few years, central banks of the region and the
\nBank of Japan have struck repurchase pacts under which they help
\neach other defend their currencies if asked.<\/p>\n
Malaysia and neighboring countries have seen attacks on their
\ncurrencies in the past month, forcing devaluations in Thailand
\nand the Philippines and expensive intervention efforts in
\nMalaysia. Indonesia has widened the trading band for rupiah.<\/p>\n
On Thursday, all the currencies fell to new lows, breaking
\npsychological barriers, on sustained dollar buying.<\/p>\n
The Singapore dollar fell to a 32-month low of 1.4785 per U.S.
\ndollar, the ringgit broke through the 2.65 barrier, the baht
\nslipped sharply to a low of 32.60, the rupiah was below 2,600 and
\nthe Philippine peso eased to 28.47 from 28 previously.<\/p>",
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