Additional RM45b injection to Covid-19 economic aid vital

MP SPEAKS | Over 41 percent of Malaysian manufacturers said their businesses would only be sustainable for less than a year, as a result of revenue loss following the Covid-19 lockdown, according to a survey by the Federation of Malaysian Manufacturers-Malaysian Institute of Economic Research (FMM-MIER).

What is interesting is those in the FMM July survey say they can last for 12 months, due to the government stimulus packages, wage subsidies and bank moratoriums.

Clearly, an additional RM45 billion is needed to the existing RM45 billion fund injection (total RM90 billion) to save not only Malaysian jobs, small and medium enterprises but also manufacturers.

Manufacturing is a key component of the Malaysian economy, contributing 21 percent of the gross domestic product (GDP) and over 80 percent of total exports in 2019.

With the International Monetary Fund predicting a global economic contraction of 4.9 percent this year, the additional RM45 billion fund injection, moratorium of bank loans, energy discounts and wage subsidies are crucial for local businesses to survive and prevent unemployment from exceeding one million persons.

There is no reason for the federal government to be so stingy about injecting an additional RM45 billion when there is sufficient liquidity in the domestic debt market of RM1.6 trillion to sustain such borrowings.

The total RM90 billion fund injection from the additional RM45 billion is not significant, compared to Singapore’s S$108 billion (RM328.9 billion) stimulus package.

The opposition wishes to reiterate our willingness to set aside political differences and fully support any financial measure that can lessen the burden of the people by doubling the RM45 billion fund injection.

Failure to do so may lead to job losses, business closures in a year and cause untold hardship to the people. By then, even if the government injects an additional RM45 billion fund injection will be too little, too late.

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 LIM GUAN ENG is Bagan MP, former finance minister, and former Penang chief minister. - Mkini