Former Prime Minister Mahathir Mohamad, according to tycoon Halim Saad, should be held accountable for the stock market's failure during the 1997 Asian Financial Crisis.
"The 1997 Asian Financial Crisis and the monetary policies put in place by Mahathir, as Prime Minister, had the effect of isolating the country, particularly from foreign investors," Halim said in a statement filed on Monday.
According to Free Malaysia Today, in July, Halim sued Mahathir and two other defendants for a government takeover of his Renong-UEM company holdings in 2001. Nor Mohamed Yakcop and the federal government were also named as defendants.
The defendants stated in their prior defense statement that the takeover was motivated by the poor performance of Renong and UEM shares during the 1997 crisis, which brought down the stock market due to the group's large market holdings.
"Under the management of the plaintiff (Halim), the market capitalization of the Renong Group declined by 41%, from RM7.2 billion in 1997 to RM4.2 billion in 2000," according to the defense.
Halim, on the other hand, rejected the defendants' claims and claimed that his administration of Renong was sound.
Prior to the government takeover, he stated, the Renong group under his direction was one of the most successful Bumiputera-owned firms.
"Out of the six Bumiputera-controlled companies in the top 30 listed companies (by market capitalization) in 2001, half were controlled by me," Halim told a news conference.
He also denied that his management of Renong caused the group's market value to fall between 1997 and 2000.
On the other hand, he claimed that the drop was consistent with the overall stock market collapse caused by the 1997 crisis.
Instead, he claimed that the then-prime minister should be blamed for exacerbating the effects of the financial crisis.
Halim also cited the political unrest sparked by the arrest and subsequent conviction of Anwar Ibrahim, the then-deputy prime minister and finance minister.
"The said events preceding it, including the 1998 attack on the judiciary, gave rise to an impression that the federal government was not concerned with the rule of law," Halim wrote in his defense of the government.
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