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Malaysia To Keep Currency Controls

January 30, 1999

KUALA LUMPUR, Malaysia (AP) _ Malaysia’s prime minister said currency controls imposed last year won’t be dismantled as long as world economies do not curb currency speculation, news reports said Saturday.

The controls, introduced last September, effectively halt offshore trading of Malaysia’s currency, the ringgit. They also place curbs on taking money in and out of the country.

``The controls will remain in place until the international community devises a new financial regime which curbs the activities of currency traders,″ Prime Minister Mahathir Mohamed said, quoted by the state-run New Straits Times daily.

Mahathir said Malaysia’s economy had been boosted by his policy of shielding it from currency traders, whom he blames for wrecking Southeast Asian economies over the past 18 months.

Some analysts warn that the move has hurt Malaysia’s ability to lure foreign investors.

Malaysia slid into recession last year after nearly a decade of growing at an average of 8 percent.

The economic troubles have stoked opposition to Mahathir’s government, which has gravitated around ousted deputy and finance minister Anwar Ibrahim, who is in jail on charges of corruption and illegal sex acts.

Pro-Anwar demonstrations erupted again Saturday in Kuala Lumpur after more than two months of relative calm in the protests.

Riot police chased away nearly 200 protesters from the main shopping district, but they reassembled in front of a nearby mosque, bearing banners and shouting slogans.

Earlier, about 1,000 protesters crowded around the courthouse where Anwar is being tried on charges of corruption and illegal sex acts. His supporters insist the charges are part of a political vendetta by his former mentor, Mahathir.

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