MARCH 5 — The PAS Central Economic, Real Estate and Entrepreneur Development Committee welcomes the recent 2020 Economic Stimulus Package announced by the federal government, worth some RM20 billion.
We note that the quantum reflects the RM19-21 billion we had estimated would be required to maintain the country’s Gross Domestic Product (GDP) at 4.8 per cent in our statement dated February 13.
In general, the package contains elements that are capable of stimulating domestic demand through supportive measures for both industry and consumer alike, in particular the retail and hospitality sectors.
Should it be implemented effectively with the appropriate care, we are confident that the projected GDP growth of 4.8 per cent is still achievable.
However, to ensure the biggest and most comprehensive impact on the economic ecosystem, we feel it is imperative that the assistance offered be made available to all sectors, rather than being limited to the tourism sector alone as it is now.
The government must look to identify and include all sectors affected by the Covid-19 situation. This alone will trigger a necessary chain reaction across the economic spectrum and produce the multipliers required to support the intended growth.
The lower mandatory contributions announced by the Employee Provident Funds also represent a positive step in increasing the Rakyat’s disposable income. However, it is imperative that it be spent wisely and on purchases that will help spur the local economy in order to avoid the liquidity trap.
Equally positive is the Government’s decision to offer extended tax exemptions for both the individual and hospitality sector, capable of spurring domestic tourism — a sector that counted 78.2 million tourists and contributed upwards of RM60 billion in the year 2019.
We recommend that the retraining scheme supported by the stimulus package for workers in the tourism sector be moulded in such a way that it will be a part of training the workforce towards the larger goal of preparing Malaysians for the future e.g. the upcoming 12th Malaysian Plan, the digital economy and Industry 4.0, rather than just act as a stop gap measure.
This can then complement the restructuring of the Malaysian economy towards a labour input based economy.
Accordingly, we also recommend that the Government takes this rectifying exercise opportunity to implement the structures and reinforce the laws that are necessary towards transforming the country into a digital economy, as outlined in our statement dated November 1, 2019.
Similarly, while we commend government’s provision of a RM1 billion fund to strengthen Agromakanan — which will restructure Malaysia’s long-term goal to strengthen its domestic food production towards food security and cushion it from imported inflation in the future — it is imperative to note that it will only prove effective if it is strategically planned and implemented thoroughly.
Finally, in line with our statements issued in early January and February, we strongly urge the government to consider including affordable housing projects in its proposed stimulus packages for infrastructure development.
This is to ensure that only projects with the biggest impact and multipliers will be executed to ensure maximum economic development as a whole.
* Statement from Mazli Noor, PAS Economic, Real Estate and Entrepreneur Development Committee vice chairman on March 5, 2020.
** This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.
