KUALA LUMPUR May 1 - Malaysia's interest to use the gold dinar for
international trade is not confined to the more than 24 countries with
which it has bilateral payment arrangement, Prime Minister Datuk Seri
Dr Mahathir Mohamad said today.
"Not necessarily with these countries only. (It can include) any country
with which we can discuss," he told a press conference after addressing
a public sector Workers' Day gathering at the National Institute of
Public Administration (Intan) here.
He said the government was studying which countries were suitable to
trade in gold dinar with Malaysia but a decision had not been arrived
at yet.
"It is not easy for people to accept the use of a currency, but we
are confident about several countries which have close ties with us,"
he said.
Dr Mahathir, who is also Finance Minister, said the use of gold dinar
for international trade could take off with the participation of just
two or three countries.
He said that Malaysia could even conduct payment of its international
trade using gold dinar with its small trading partners.
Dr Mahathir said Morocco, Libya and Bahrain, which have minimal bilateral
trade with Malaysia, "have expressed a great deal of interest" in the
dinar.
A few Arab countries might accept the gold dinar for payment of their
international trade, said Dr Mahathir who has recently visited Morocco,
Libya and Bahrain.
The Prime Minister, a strong supporter and promoter of the dinar, said
the physical movement of dinar to pay for international trade would
be minimised by the bilateral payment arrangement.
The payment that had to be honoured would be limited to the difference
between the value of imports versus exports, he said.
However, through the e-dinar system, no movement of the gold dinar
was required, said Dr Mahathir.
The e-dinar system is an Internet-based electronic payment and exchange
system that facilitates gold-backed transactions between individuals.
Dr Mahathir said the e-dinar could therefore be used for international
trading but a bilateral agreement on this was needed.
"We are trying to push e-dinar (for trade between countries) but we
have to push gently. We cannot force other countries," he said.
The Prime Minister said it was hard for countries to accept the gold
dinar as it was a new development requiring them to study the implications
to their economies and relations with other countries.
In addition, when countries held gold dinar as their reserves, they
recognised the fact that it did not earn interest, said Dr Mahathir.
"But there are other ways to ensure that the value of gold dinar stays
and keeps up with inflation," he said.
Asked how soon the gold dinar could be implemented for international
trading, he said it depended on the acceptance of the gold currency.
To further promote the dinar internationally, Malaysia would be holding
an international seminar on it soon, he said.
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