This article first appeared in The Edge Financial Daily on March 19, 2019 - March 25, 2019

KUALA LUMPUR: 'Ambition. Purpose. Clarity.' This is the theme and likely the very things that Malaysia’s investing fraternity will be looking out for at the largest capital market event in the country that will start today, the first time the annual event is being held under the Pakatan Harapan government.

To say the two-day Invest Malaysia forum — which will see Prime Minister Tun Dr Mahathir Mohamad delivering the keynote address — is much anticipated, is probably an understatement. This is especially so after a year that has been buffeted by trade war tensions in the global arena, amid domestic uncertainties about policies and directions following the first change of government Malaysia has seen since its independence over 60 years ago.

Indeed, following various see-saw announcements in the past year, clarity on governmental policies and directions is probably what most investors, be it local or foreign, are most hungry for.

This forum, organised by stock exchange regulator Bursa Malaysia and Malaysia’s biggest banking group, Malayan Banking Bhd, is not the first time the government is reaching out to the investing fraternity.

Just last October, the government’s top ministers shared their thoughts on the way forward for the country with investors at the “Malaysia: A New Dawn” conference.

Now, five months down the road and a little over 10 months since Pakatan has taken over Putrajaya, what are the specific issues investors are keen on or want addressed? Here is our take on them:

1. What to drive economic growth?

The government is seen to have made the right step forward in addressing the country’s economic issues by setting up the Economic Action Council.

This brings high hopes for the council to come up with economic policies and measures to drive sustainable economic growth. Bluntly put, the council has been in silence. This may cause investors’ confidence to wane especially as the external headwinds are getting strong.

Investors are keen to know how will the government spur growth with the constraints on fiscal spending given the high national debt. Is the new government focusing on growing the economic pie so that as the pie grows bigger, the debt-to-gross domestic product ratio will drop? Or has the government mapped out a plan to bring down the debt?

2. Report card on structural reforms

Structural reform is one main task that the new government is expected to do.

Good governance, economic liberalisation and reforms, democratic reform, and clamping down on corruption are the main areas that the investing fraternity are paying attention to.

Having been in power for about 10 months, investors would want an update on the progress of the reforms although they are aware that institutional reforms take time and will not happen overnight.

For instance, is the government already implementing open tenders for all public projects?

Given the heavy presence of the government (or government-linked companies) in many industries, are there measures taken for liberalisation?

In the longer run, what are the efforts made to transform the domestic economy (which is more than driving this year’s economic growth), for example to get out of the middle-income trap and to migrate from low wages to a high-skilled manufacturing hub?

3. Political stability intact?

Political stability is a must among the criteria for making investment decisions.

Investors would probably want to hear from the horse’s mouth that there will be a smooth transition when the handover of power takes place. Furthermore, there have been lingering concerns whether the coalition could hold the distance.

Meanwhile, the current opposition party, which had ruled the country for 60 years, has been cranking up identity politics. What will the new government do to hold the nation together so that the rakyat would not be disturbed or influenced?

4. Measures to improve market vibrancy and corporate governance

The Malaysian equity market was once among the top five in Asia. Are there measures in the pipeline for the authorities to bring back the heyday to the local equity market?

For instance, Bursa Malaysia has not seen that many initial public offerings that will excite institutional and retail investors for a long while.

On the other hand, the 1Malaysia Development Bhd scandal has just exposed the loopholes in the rules of law and lack of governance. What are the additional steps that the local regulators are taking to ensure the country will be able to uphold a high level of public governance and corporate governance so that investor interest is protected.

5. The future of GLCs

One of the most hotly anticipated sessions this afternoon will bring together the newly appointed heads of Malaysia’s largest institutional funds — Permodalan Nasional Bhd, the Employees Provident Fund, Khazanah Nasional Bhd and Kumpulan Wang Persaraan (Diperbadankan).

They are the biggest investors in the local stock market; when they move, they move the local bourse.

The change of the guard at these large institutions has left investors pondering new strategies and investment mandates under the new leadership.

Meanwhile, questions remain about the heads of government-linked companies that did not roll. Will that take place later?