KUALA LUMPUR: It is pertinent to understand the true spectrum of the current fiscal and capital markets before solving the financial needs of the country and society, said Malaysia International Islamic Finance Centre (MIFC) chairman Tan Sri Azman Mokhtar.
He said that while it is important to understand the landscape of the marketplace, it is also crucial to know the function of finance itself, which is to serve the real economy.
“The real economy must serve the society and this includes people who need employment, income, growth, sustainability and address inequality in the environment.
“But the pyramid today is somewhat inverted where people are facing more price increases and this is not necessarily due to higher cost of living, but it is because of ‘too much profit’ by banks and the industry. Therefore, people on the ground are feeling the pain,” he said at the Capital Market Research Malaysia-Securities Industry Development Corporation inaugural Capital Markets Industry-University Talent Bridging Conference here, today.
Azman also said that any marketplace has its demand and supply which must be matched, and to match that, the government has to think this through and play its part while the private players need to be enablers.
“For example, in the case of Farm Fresh Bhd, Khazanah Nasional Bhd invested in a local venture capital fund (30 per cent stake), while the remaining 70 per cent were from entrepreneurs because they needed capital to grow.
“Over time, Khazanah learnt and discovered more about the Farm Fresh business and products. Therefore, we need the system to allow more venture capital. It is ok to fail, provided it is a good failure, not bad failure,” he said.
Azman stressed the importance to gather all stakeholders from the public and private sectors as well as the society by utilising technology to get the right talents through thought leadership.
“One of my ideas that I try to put forward is what I call ‘horses for courses’. Once you understand the landscape, you must understand that to solve certain things, we need different kinds of horses.
“For example, if you want to develop entrepreneurs, the capital that is needed has to be less than what the banks offer (because banks would need collateral and so on), so it is vital to understand the concept of venture capital because when you do it well, it will allow new firms, new ideas and innovation to come out,” he said.
Azman also holds chairmanships in other organisations, such as INCEIF University, Lembaga Tabung Haji, MIFC Leadership Council and Universiti Teknologi Malaysia.-Bernama
