KUALA LUMPUR: There is no truth in claims that  the ringgit is depreciating against the US dollar due to foreign workers remitting money to their families back home, the Dewan Rakyat was told yesterday.

Deputy Finance Minister Datuk Kong Cho Ha stated that since the shift to manage flotation on July 21, 2005, the ringgit’s value had appreciated by 14.6 per cent vis-a-vis the US dollar.

He said that up to the first quarter of this year, foreign workers had sent home only RM4.545 billion or 2.8 per cent of the total cash outflow from the current account.

“Hence, the impact on the national economy and the ringgit value is not  substantial. Furthermore, Malaysia’s strong inter-national reserves are expected to absorb the cash remittances which accounted for only 1.2 per cent of the total current reserves,” he said when replying to Datuk Abdul Manan Ismail (BN-Paya Besar) during question time.

Kong said foreign workers in Malaysia were allowed to convert their ringgit-based income into foreign currencies when sending money back to their homeland.

He said this process can be done only at licensed local banks and through permitted money order service at Bank Simpanan Nasional and Bank Rakyat.

Of the 2.1 million foreign workers in the country, a foreign worker sends home not more than RM500 a month, he said.

“The amount is reasonable as they have families back home who need the money for their living,” he said.

Meanwhile, Minister in the Prime Minister’s Department Tan Sri Amirsham A Aziz said the government was prepared to review existing subsidies in tandem with the current inflation situation.

He said the government took pre-emptive measures to protect the people’s welfare especially the low-and medium-income earners following the hike in fuel and food prices early this year.

“This include giving cash rebates to vehicle owners, retaining cooking gas subsidy, fertiliser subsidy for farmers and education subsidy for parents of school-going children.

“The government also encouraged target groups to do part-time work to supplement their income,” he said when replying to Dr Mohd Hatta Md Ramli (PAS-Kuala Krai) and Fong Kui Lun (DAP-Bukit Bintang).  — Bernama