The veneer that was used by the previous government to gloss over the true fiscal situation in the country has finally been laid bare and this has spooked investors, Rafidah Aziz said today.

In turn, the former international trade and industry minister theorised, international awareness of the reality faced by Malaysians contributed to the recent slide in the Malaysian stock market.

"For so long now, there have been massaging, rehashing and the touching up of statistics.

"There was the unbelievable abuse of authority, the extent of the rot and the gangrene that has set in as a result of the collective misdeeds.

"There was the clear breaking down of some of the systems, and the existence of the environment of fear, intimidation and disregard for the rule of law," Rafidah told Malaysiakini.

She was commenting on claims by various quarters that the recent slump in the Malaysian stocks at Bursa Malaysia was a consequence of the government's revelation on Monday that national debt had surpassed RM1 trillion.

Rafidah stressed that while the old objective was to "present a picture much rosier than it really is", what was needed now are transparency, responsibility and honesty, even if these measures fail to impress short-term speculators.

Investors who strategise over the longer term, she added, would appreciate knowing the real situation now and be assured by the policies being put in place by the new administration.

New gov't knows how to move forward

Instead, she pointed out, it was important for speculators and traders to factor in the fact that the new Pakatan Harapan government knows where and what the problems are, and that it has a clear idea of how to move forward, resolve the issues and strengthen economic governance.

After all, she rationalised, "two apples plus two apples do not make four apples that are edible, no matter how green or red the skins are if one apple has maggots in it... therefore, rendering only three apples being edible."

Rafidah added: "The economic foundation of Malaysia is strong, although there is much potential to further strengthen it, to make Malaysia highly competitive and resilient, operating in the dynamic and increasingly competitive world.

"It is hoped that, given previous track records of overall governance before the last decade, investors and the private sector can justifiably be assured... that the business-friendly government of Pakatan Harapan has, and will continue, to put into place policies and measures premised upon responsible governance that will put Malaysia back on the growth trajectory."

Her statement comes as the Mahathir-led government, especially the Ministry of Finance led by former Penang chief minister Lim Guan Eng, was criticised for revealing details on the nation's debt and spending.

This comes as Lim's ministry is looking into spending linked to the 1MDB fund founded by ousted prime minister Najib Abdul Razak.

However, Lim today vowed to carry on, saying it was more important for the new government to show that it was committed to transparency and that it had shed the old administration's practice of "hiding spending".