The government’s move to allow partial resumption of economic activities during the fourth phase of the movement control order (MCO) is not being done in haste as it has made the necessary studies and is complying with conditions set by the World Heath Organisation (WHO).
Finance Minister Tengku Zafrul Tengku Abdul Aziz said the government, however, is not forcing any company to start operations immediately, as there may be those that need to make prior preparations to meet conditions set by the government.
“As an example, for restaurants, owners must ensure the premises are clean and so on…so, it’s not necessary for all parts of the economy to be opened on Monday,” he said in the Eksklusif TV3 programme that aired yesterday.
The WHO cited six criteria for countries considering lifting restrictions, including having the health system capacities in place to detect, test, isolate and treat every case and trace every contact.
Zafrul said the country is currently using only 30% of its capacity.
He said the government has a six-phase plan for reopening the economy – Resolve, Resilience, Restart, Recovery, Revitalise and Reform (6R) – and the country is in the fourth phase, which is Restart.
“We hope that before the end of May, Prime Minister (Muhyiddin Yassin) will announce the details of the recovery plan.
“Every industry is impacted differently. For example, tourism is the industry worst hit by the Covid-19 outbreak, so we have a different plan for that industry,” he said.
On the rate of unemployment and business closures, Zafrul said these are happening not just in Malaysia but also in the United States and Europe, which have been hit by high unemployment rates.
He said the government is trying to keep as many people employed as possible by launching a wage subsidy programme with a RM13.8 billion allocation under the Prihatin Rakyat economic stimulus package (initially RM5.9 billion was allocated but the amount was increased by RM7.9 billion under the additional package).
“The Social Security Organisation (Socso) made a forecast that 500,000 employees would be affected (become unemployed), but it would be worse if we had not launched the Prihatin package,” he said.
Zafrul said the country’s GDP may fall by 3% to 4% following the extension of the MCO to more than five weeks, compared with Bank Negara’s GDP growth forecast of -2% to 0.5% after just two weeks of the MCO.
Last year, Malaysia’s GDP grew by 4.3% compared with the year earlier.
On the national debt-to-GDP ratio, he said it stands at about 51% now versus the ceiling of 55%, so it is still below the set limit.
“We also have a foreign debt ceiling, which is RM35 billion, so we still have some room there (as well),” said the minister.
On the 2020 budget deficit, he said it is currently estimated at about 4.7% following the introduction of the Prihatin packages, but the figure may rise to 5% due to low crude oil prices.
For the long term, he advised companies and SMEs to invest in the digital field and equip themselves with the right skillset towards Industry 4.0.