by Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjung, Lim Kit Siang, in Petaling Jaya on Monday, June 14, 1993:
Finance Minister, Anwar Ibrahim should direct Bank Negara Governor to appear before PAC to answer questions on Bank Negara’s colossal foreign exchange losses last year and not hide under the excuse of ‘national interest’
Finance Minister, Datuk Seri Anwar Ibrahim, should direct Bank Negara Governor, Tan Sri Jaffar Hussein, to appear before the Public Accounts Committee (PAC) of the Dewan Rakyat to answer questions on Bank Negara’s colossal foreign exchange losses last year and not hide under the excuse of ‘national interest’
The failure of Bank Negara Governor, Tan Sri Jaffar Hussein to appear before the PAC last Satuday and the refusal of the Bank Negara Governor Deputy Governor, Tan Sri Dr. Lim See Yan to answer questions about Bank Negara’s colossal forex losses last year is an open challenge to the principle and system of parliamentary government in Malaysia.
It makes a total mockery of the government’s commitment to the priciples of accountability and responsibility to Parliament when a body set up by Parliament could defy the PAC by hiding under the excuse of ‘national interest’!
Is the Bank Negara suggesting that PAC and by implication, Parliament, are acting against the ‘national interest’ in demanding greater accountability for Bank Negara’s colossal foreign exchange losses last year – which is undoubtedly the greatest financial scandal in Malaysia as it is five or six times the Bumiputra Malaysia Finance scandal of a decade ago?
PAC and Parliament must make the final decision whether Tan Sri Jaffar Hussein appears and answers questions before the PAC or not
It is the PAC and Parliament which must make the final decisions as to whether the Bank Negara Governor should appear and answer questions before the PAC on the Bank Negara’s colossal forex losses, and not the Bank Negara itself
When the Bank Negara Governor or Deputy Governor claims ‘national interest’ in refusing to appear before the PAC or to answer questions about Bank Negara’s colossal forex losses, they cannot make a bald and blanket claim, but must substantiate their claim with a strong and compelling case as to how their answers to such questions could undermine national security or economic stability.
For instance, Tan Sri Jaffar Hussein should explain how national security or economic stability would be jeopardized if answers are given to the PAC on the following questions:
What is the actual total amount of foreign exchange losses suffered by Bank Negara last year – whether it is RMl2.8 billion or RMl6 billion
How Bank Negara could lose over RM l0 billion from the British sterling crisis last September when one American, George Soros, 62, could make RM5 billion from British sterling in the same currency crisis? Is this because Bank Negara bought sterling long while George Soros sold British sterling short in the same currency crisis?
Last year, Bank Negara departed from its previous accounting practice of the past 33 years in the re-evaluation of gold at its current market rates instead of at the rates they were acquired. Much of the large quantities of gold held by Bank Negara had been bought before 1970 when it was priced at US$37 an ounce. Gold was worth US$333 an ounce at the end of last year or about 100 per cent higher. According to the latest International Monetary Fund statistics, Malaysia had 1.37 million ounces of gold in 1970 and in 1991, this had increased to 2.35 million ounces. What is the net gain to Bank Negara from this re-valuation of its gold holding – and has this net gain also been lost in the forex speculation last year?
Who are the officers in Bank Negara responsible for its colossal forex losses last yea, and what action had been taken against all those responsible.
If Bank Negara does not went to answer these four question, for instance, then it must be able to convince the PAC, Parliament and in fact the whole country why their answer are against “national interest” and not against the interest of individuals seeking to forestall demands for public accountability for the failures or incompetence of their actions.
As finance Minister, Anwar Ibrahim must bear full responsibility for the refusal of Band Negara Governor to appear before the PAC and the Bank Negara Deputy Governor for refusing to answer questions about the colossal forex losers. If necessary, Answer Ibrahim should go to the Cabinet on Wednesday for a Cabinet decision directing Bank Negara Governor, Tan Sri Jaffar Hussein, to appear before the PAC and answer questions about the Bank Negara forex losses last year.
Dewan Rakyat meeting on July 19 should have a full debate on whether to sustain or reject Bank Negara’s excuse in refusing to answer question on the colossal forex losses at the PAC
The Finance Minister, Anwar Ibrahim, had claimed in Parliament that Bank Negara’s report is more “transparent” than the reports from the central banks of other countries. This is not true and the Finance Minister and the Bank Negara should stop using this as an excuse to forestall demands for full accountability for Bank Begara’s colossal forex losses.
Regardless of whether Tan Sri Jaffar Hussein relents and agrees to appear before the PAC or not, PAC should submit its report on its efforts to investigate Bank Negara’s forex losses to the next meeting of Parliament beginning on July 19, so that the whole matter is handed back to Dewan Rakyat and a full debate held as to whether the excuse of Bank Negara that it could not answer question on its foreign exchange losses last year “in national interest” should be sustained or rejected.
Dewan Rakyat can order Tan Sri Jaffar Hussein to appear before the PAC to answer questions on Bank Negara’s colossal forex losses or face Parliamentary contempt proceedings in default.