Its a bitter pill but one that is necessary, the Movement Control Order 2.0 which has been initiated by the government for the second time due to the raging third wave of the deadly virus is costing the county dearly. Although the financial figure is much lower than the one in March, the government still expects to lose RM600 million daily.
The information was delivered by Finance Minister Tengku Datuk Seri Zafrul, “this MCO is unlike the one in March last year as five essential sectors are still open; small and medium enterprises such as stalls and stores can still be opened,” he said in a media briefing on the Malaysian Economic and Rakyat’s Protection Assistance Package (PERMAI)
Malaysia suffered a devastating loss from March to May last year with a reported burn of RM2.4 billion daily during the lockdown, however as the Minister with the operation of certain certain sectors including manufacturing, construction, services, trade and distribution, as well as plantations and commodities will leave a lesser impact on the overall economy.
There has been no clear timeframe given when MCO 2.0 will end, but estimate are that another 6 weeks will be needed to flatten the current situation. In view of another prolonged shutdown, the Prime Minister recently announced the PERMAI stimulus package to aid those affected. According to Tengku Zafrul, PERMAI is an improvement of the initiatives announced in Budget 2021 as well as ongoing initiatives in the Rakyat Prihatin Economic Stimulus Package and PENJANA.
Despite the unknown locked down period, Malaysia will still maintaining its GDP growth projection, in hoping the recent subsidy initiative will keep the momentum going for the country. Tengku Zafrul said Malaysia’s GDP recorded a contraction of 2.7 per cent in the third quarter of 2020, which was among the best in Asean compared to Singapore (-7 per cent), Indonesia (-3.5 per cent), Philippines (-11.5 per cent), and US (-2.9 per cent).
The Finance Minister has additional ammunition if required, apart from the allocated RM15 billion the treasury can inject an additional RM6.6 billion if required.