Change of gov't an opportunity to rebuild economy from scratch - expert

Amid speculation a counter-coup is in the works, some parties have voiced concern that the political uncertainty could spell trouble for the country’s struggling economy.

For economist Barjoyai Bardai however, changing the government yet again could present a good opportunity to rebuild the economy from scratch.

“That’s because it is easier to start from scratch (whether there is a change of government or not).

“It is up to Prime Minister Muhyiddin Yassin and his team whether they would dare to take this approach. For example, the tourism, hotel, and aviation industries are already obliterated. Even if you try to fix it, it is futile.

“You need to start from scratch with a new model,” he told Malaysiakini when contacted yesterday.

Elaborating, Barjoyai said the movement control order (MCO) since March 18 has stalled the economy, including the small and medium enterprises that are hard-hit.

He predicts that the economic growth rate would shrink by 5 percent for the second quarter of this year, and would recover in the fourth quarter after a period of hardship.

Some 2 million people would lose their jobs in the coming weeks, and the newly unemployed would surely seek government support.

“Whoever takes over this government will take over a government burdened by all this. Is this the best time for a coup?

“But I don’t know. Perhaps Langkawi MP Dr Mahathir Mohamad or Port Dickson MP Anwar Ibrahim feels this is the best time because now that we are down, we can drive our economy forward in a new direction,” he said.

Although Perikatan Nasional has seized control of the federal government from Pakatan Harapan, the opposition has questioned the ruling coalition’s majority.

Based on the seating arrangement during the May 18 parliamentary sitting, PN appeared to have a majority of just two seats.

Meanwhile, Mahathir and Anwar are said to be confident that PN no longer has the majority to form the government and are competing to set up a new coalition.

Harapan is rumoured to be making arrangements and are almost ready to retake Putrajaya from PN.

If the counter-coup materialises, Barjoyai said the new government may halt all previous economic plans and rebuild the economy from scratch with a new model.

“So, it can be something very positive because I see the current government has been driven into a dead end and could not advance.

“So, the upside of a new government is the possibility (of starting over),” he said.

However, he stressed that whether the government changes or not is not a major issue because the true “unsung heroes” are the civil servants working day and night to come up with plans to revive the economy.

Meanwhile, Universiti Putra Malaysia economist Ahmed Razman Abdul Latiff said a sudden change of government would make things worse for the economy.

If there is a change of government in the short term, he said, the economy would be affected since it would entail a change of ministers. This could halt initiatives and policies that are already underway to revive the economy.

He said investors' confidence would also be affected due to uncertainty over government policies, and it would also influence investors’ plans whether they are domestic or foreign investors.

Ordinary folk would suffer even worse job losses and business closures, he said, at a time where the Statistics Department is predicting an economic recession in four to six months.

“Of course, we will need a government that can focus on reviving the economy and not on power struggles.

“At least we hope that if there is another transition of power, it would take place through proper channels such as Parliament and not abruptly, because the focus now should be on the economy and peoples’ welfare,” Ahmed Razman told Malaysiakini. - Mkini