KUALA LUMPUR: The Retirement Fund Inc's (KWAP) recent investment in Jakarta exposed major weaknesses in its process due to excessive reliance on international trends and external institutions, Prime Minister Datuk Seri Anwar Ibrahim said.
He said the incident underscored the need for stricter safeguards and greater accountability in managing public funds, despite the fund's existing due diligence and investment committee procedures.
"In this case, we relied on SoftBank, assuming it would not make a careless investment, but that turned out to be the case.
"I acknowledge the shortcomings. However, we cannot deny KWAP's overall achievements in recording substantial profits. That is clear, but we must also acknowledge the weaknesses," he said during Prime Minister's Question Time in the Dewan Rakyat today.
Anwar was responding to Datuk Seri Dr Ronald Kiandee (PN-Beluran), who asked about substantial losses suffered by KWAP, measures to identify those responsible, and steps to tighten investment procedures to prevent future losses.
He said the fund's existing due diligence and investment committee procedures were structured and stringent, but the investment exposed a critical flaw in relying on international trends and external institutional judgment, including major European and Japanese firms.
He said the government will further tighten regulations and procedures to ensure public funds entrusted to KWAP are managed responsibly.
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