Economist warns Tabung Haji losses hurt Malaysian SMEs and fiscal health
Economist Harridon Suffian says Tabung Haji's financial troubles have reduced orders and profits for its Malay-owned partners, harming tax revenue and growth.
Harridon Suffian, a lecturer at Universiti Kuala Lumpur Business School, linked Tabung Haji's financial difficulties to a slowdown for firms tied to its business network, especially Malay-owned SMEs. He noted that lower spending by the pilgrim fund translated into fewer contracts for partners, suppliers and subcontractors, curbing their earnings and tax payments. The royal commission of inquiry, which examined Tabung Haji's management from 2014 to 2020, uncovered investment irregularities and a failure to record a significant impairment in its 2017 accounts.
Additional issues included debt-driven asset sales by TH Plantations and reduced palm-oil output. Suffian warned that the fund's need to cover past losses has displaced capital that could have funded new investments, while taxpayer-funded bailouts divert resources from other economic projects. Ahmad Zaharuddin Sabri of Global Asia Consulting called for continued scrutiny, forensic audits and clear accountability for investment decisions.
Why it matters
The fund's losses ripple through Malaysia's economy, affecting SMEs, tax revenue and future investment capacity.
In this story
