Reduce illicit capital outflow by wiping out graft, says Guan Eng
Putrajaya can curb the country’s illicit capital outflow if corruption is eradicated, said Penang chief minister Lim Guan Eng, following a report by a global anti-corruption group naming Malaysia as among the top 10 countries for illicit capital outflow in 2012.
Global Financial Integrity (GFI) in its report on Monday said that Malaysia was No 5 with nearly US$49 billion (about RM170 billion) flowing out of the country in 2012, after China, Russia, India and Mexico.
Lim said Malaysia is actually the top country with illicit outflow of money per capita.
He said it was also reported that Malaysia had lost an accumulated RM1.38 trillion since 2003, which was enough to fund the country's budget for five years.
"The government must pay attention to this. So much money we have lost. How much longer do we have to deal with this?
"Putrajaya does not even need to impose the Goods and Services Tax (GST) next April. All it needs to do is eradicate corruption.
"You eradicate corruption, you solve your problems," he said.
The 6% consumption tax is being introduced to generate revenue for the federal government, reducing its dependence on revenue collected from income tax and oil.
Lim used his administration as an example, saying that by reducing corruption, Penang had managed to record surpluses annually since 2008.
He said the federal government had recorded deficits annually for 16 years.
"The last time Malaysia had a surplus was when (opposition leader) Datuk Seri Anwar Ibrahim was finance minister.
"Since 1998, we haven't had a surplus," he said.
In the latest GFI report, nearly US$1 trillion (RM3.5 trillion) was illicitly drained from developing countries in 2012, representing a record level of corruption, money laundering and false trade documentation.
Illicit financial flows around the world grew at 9.4% a year in the decade to 2012, around double the pace of economic growth, draining funds, especially from impoverished countries.
Previously, Malaysia was No 2 in the illicit outflow ranking in 2010 before doing better, moving down to fourth place the following year. – December 18, 2014.
