Malaysia’s Economy Shows Positive Signs as More People Resume Work
Malaysia’s economy is headed towards a brighter direction after it reopened and saw almost 70% of the workforce recommencing work. Things are surely looking up for Malaysians as 12.7 million employees have returned to their line of businesses, as of 2 June 2020.
According to the Department of Statistics Malaysia (DOSM), the nation’s economic activities on 17 May 2020 was at 67.2%, with 10.2 million working employees. This number has experienced a surge of 16.3% and is now at a healthy 83.5%, with roughly 12.7 million workers. This further substantiates Malaysia’s efforts on recovering its economy by as early as 2021.
Not only that, data provided by DOSM has also shown that wholesale and retail trade in April 2020 was at RM 66.9 billion; the number has spiked up to RM 84.4 billion in May 2020, with a 26.3% increase. However, the unemployment rate is expected to experience a slight increase for May 2020, with 5.3% compared to the previous rate of 5.0% in April 2020.
With that said, the country is slowly catalysing progress with employee back-to-work rates, which is included in the 14th Prihatin Rakyat Economic Stimulus Package (Prihatin) and National Economic Recovery Plan (Penjana) Implementation Report. Additionally, Malaysia’s government has submitted the report to the Global Economic Prospects June 2020 (World Bank Group) to highlight the outbreak’s impact on the country’s economic condition.
Malaysia’s Economic Support Packages
Malaysia is acknowledged as one of the countries in South-East Asia to have implemented robust economic support packages, besides Thailand. The two countries have enacted excellent policy support packages with around 17% and 13% of the GDP respectively. The focus will be on the well-being of public health, provision of care, loan guarantees, and to jumpstart businesses with incentives. Having said that, the country still recognises the possibility of a second COVID-19 wave and is on the lookout for any exponential growth of positive cases.
The country has also implemented a ‘6R Approach’ which involves six phases – Resolve, Resilience, Restart, Recovery, Revitalise and Reform to cushion the pandemic-stumped economy. Currently, Malaysia is in its fourth phase, ‘Recovery’ which entails devising a short-term economic recovery plan, which was announced in the previous month.
Financial Support for Malaysians and Businesses
During these times, Malaysians can seek financial aid at the Credit Counselling and Debt Management Agency (AKPK) to ease their burden. On the other hand, Small and Medium-sized Enterprises (SMEs) can apply for the Small Debt Resolution Scheme, while bigger companies can refer to the Corporate Debt Restructuring Committee. The government has also introduced a Special Prihatin Grant (GKP), amounting to RM2.1 billion which will help micro SMEs to stimulate cash flow. The good news for micro SMEs is that they do not have to return the one-off financial assistance of RM3,000.
The government has reminded Malaysians not to be complacent as the situation can worsen any time. Malaysians were cautioned to practice social distancing and adhere to the standard operating procedures, as the outbreak is far from over.