KUALA LUMPUR, Aug 12 — Former finance minister Lim Guan Eng said the government must extend the blanket loan repayment moratorium as the economy has yet to fully recover from measures taken to contain the Covid-19 pandemic.

The Bagan MP said the government should not take the marginal drop in unemployment across May and June as signs that the economy was robust enough for businesses and workers to resume servicing their loans.

Among others, he pointed out that absolute unemployment in June actually rose by 218,000 people compared to the same period last year.

He went on to say that the government should instead take the proportionate decline in unemployment as a sign that its loan repayment moratorium has been effective in preserving jobs.


The government’s refusal to extend the blanket loan repayment moratorium that the current finance minister said would cost banks around RM1 billion a month would ultimately harm 7.7 million individuals and 245,000 small businesses, Lim said.

“Such stubborn refusal is regrettable when the cost to banks that benefits ordinary Malaysians and businesses (at) RM66.6 billion is small at only RM6.4 billion over the 6-month moratorium.

“This is a small price to pay for the banking industry when it earned an estimated RM32 billion in after-tax profits for 2019.


“Even if the banks are unwilling to cough up the cost of RM6.4 billion, the federal government can bear the cost of RM6.4 billion to aid the 7.7 million individual borrowers and 245,000 SMEs,” he said in a statement today.

Lim said conditions were likely to deteriorate when the expected low numbers for the second quarter’s gross domestic product (GDP) were announced.

He repeated his call for the government to extend the moratorium, saying it was a crucial tool in its policy arsenal that could have a real impact in saving jobs and businesses.

“Failure to do so would only give rise to suspicion that the RM 295 billion economic stimulus package Prihatin to battle the Covid-19 economic crisis is only heard but not felt, benefiting certain well-connected groups but not ordinary Malaysians and SMEs,” Lim added.

He said party hopping by elected assemblymen is a betrayal of the voters who had voted for them.

“If you want to hop, don’t bring the seat with you. That is the issue here. They are bringing the seat they won under PH with them and this is a betrayal of the people’s trust. This sort of betrayal has led to the collapse of the federal and state governments,” he said.

While Chow did not specify the assemblymen he was referring to, it was reported that Seberang Jaya assemblyman Dr Afif Bahardin and Sungai Acheh assemblyman Zulkifli Ibrahim were both sacked from PKR, the party they had contested under previously.

It was also reported that Dr Afif had joined Parti Pribumi Bersatu Malaysia (Bersatu) and that Zulkifli planned to join one of the Perikatan Nasional parties.

Another two assemblymen who could be asked to vacate their seats were Bersatu assemblymen Khaliq Mehtab Mohd Ishaq and Zolkifly Lazim.

While both had contested under Bersatu and had remained under Bersatu, they were initially under PH before their party split from the coalition.