Economist warns Network School controversy could derail foreign capital

SHAH ALAM - Malaysia's ambition to attract high-value, high-technology investments could be undermined if concerns surrounding the Network School programme are not addressed transparently and decisively, an economist warned.

Economist Dr Geoffrey Williams said the emerging investment ecosystem in Johor, particularly around Forest City and the Johor-Singapore Special Economic Zone (JS-SEZ), depends heavily on investor confidence, making transparency essential.

"Malaysia is trying to attract wealthy, high-technology innovators and entrepreneurs.

"If issues like this are not handled sensitively, they can quickly undermine investor confidence. Foreign investors have options, and they will simply take their money elsewhere if Malaysia is seen as a difficult place to invest," he said.

However, Williams said international investors are generally less concerned about the issue itself than whether it creates uncertainty or complicates doing business.

"These issues may seem important locally, but millionaire investors are focused on stability, business conditions and the ease of investing. If those become uncertain or confusing, they will simply invest somewhere else," he said.

Williams said Malaysia cannot afford to create unnecessary uncertainty at a time when it is competing with other regional economies to attract global capital.

Earlier, Johor Menteri Besar Datuk Onn Hafiz Ghazi said there were public concerns over the operations of the Network School, including allegations that Israeli nationals had participated in its programmes using second-country passports.

In a statement on July 14, the Home Ministry said it had taken note of the Johor state government's statement on the matter and viewed it seriously.

Investigations by the police and the Immigration Department are underway to determine those involved with the Network School in Forest City, which was alleged to have hosted Israeli nationals using second-country passports.