Recovery will be slow, even with border reopening, says economist

 

The Malaysian International Chamber of Commerce and Industry said the reopening of borders will give businesses a shot of confidence. (Bernama pic)

PETALING JAYA: An economist has warned of a slow economic recovery even as the country prepares to reopen its borders next month.

Geoffrey Williams of the Malaysia University of Science and Technology (MUST) said this was especially the case for the international tourism sector.

He said tourists looked at which countries were completely open and which continued to have pandemic restrictions in place.

“Malaysia is in the second category given that there are restrictions such as wearing face masks and the use of the MySejahtera app, even for foreign visitors.

“There will still be a lot of caution and a slow recovery in international tourism over the rest of the year,” he told FMT.

Williams added that the restrictions, testing and SOPs had no real effect as compliance rates had fallen and the public had learned to live with Covid-19.

“Borders should reopen with no restrictions in day-to-day living to have an immediate impact,” he said.

However, Malaysian International Chamber of Commerce and Industry (Micci) executive director Shaun Cheah said that the reopening of borders would speed up economic recovery.

“It will hasten the country’s economic recovery and give businesses a shot of confidence,” he said.

Meanwhile, the Small and Medium Enterprises Association of Malaysia (Samenta) said the reopening of borders would make the country’s gross domestic product (GDP) growth targets more achievable.

“Our economy grew by a modest 3.1% last year against a 5.6% decline in 2020, primarily as a result of an extended lockdown and continued closure of our borders.

“With the lifting of restrictions such as mandatory quarantine, our goal for a 5.5% to 6% GDP growth for 2022 is now more realistic,” Samenta chairman William Ng said in a statement today.

He added that the announcement would benefit the tourism sector the most.

Prime Minister Ismail Sabri Yaakob announced today that Malaysia’s borders would reopen on April 1 after being closed for two years since the first movement control order in March 2020. - FMT