PETALING JAYA: The Federation of Malaysian Manufacturers (FMM) has urged the government to bring forward its stimulus packages planned to address the US-China trade war risks.
It said this was necessary to help minimise the impact on the manufacturing, tourism and construction sectors, among others, that have been affected by the outbreak of the novel coronavirus (2019-nCoV), and to support overall economic growth.
In a statement, FMM president Tan Sri Soh Thian Lai noted that China has been Malaysia’s largest trading partner for 10 consecutive years, and trade has grown 8.1% to RM313.8bil in 2018
Due to this, he said the outbreak of the respiratory illness is expected to negatively impact the local manufacturing sector.
“Given the close links with China’s global supply chain, manufacturers that are export-oriented that rely heavily on Chinese demand and those that import their raw materials from China are largely expected to be significantly affected, ” he said.
Soh requested that the government also introduce several other measures as part of the stimulus package.
Among the measures proposed were initiatives to boost Malaysia’s exports, isuch as intensifying the promotion of buy Made-in-Malaysia products to strengthen the domestic manufacturing industry; and to conclude the Regional Comprehensive Partnership Agreement (RCEP) and implement Free Trade Agreements (FTAs) such as the Comprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP).
Another measure proposed by the association was a reduction in the SST by 2% for a 12-month period to boost business conditions, leading to higher investments and employment opportunities as well as higher disposable income for the rakyat.
Noting that the association understood that the delay in GST refunds was due to the need for the Customs Department to carry out field audits before refunds are granted, it urged the government to expedite the refunds by only undertaking field audit based on company risk profile.
It said the Customs Department could opt to carry out verification audit, which it said was sufficient for companies with a good track record.
FMM also called for levy payments to the Human Resource Development Fund (HRDF) be reduced from 1% to 0.5% for all employers for a period of one year, and for electricity and gas tariffs to be reduced for the next year to help lower business costs and sustain operations.
A further cut of 50 basis points on the Overnight Policy Rate (OPR), it said, would also help cushion any anticipated moderation in economic activities.
“Most importantly, FMM calls on the Government to set up a Budget Implementation Committee to ensure that all the proposed and approved initiatives and projects in the Budget 2020 and also earlier national budgets are implemented as planned and where possible expedited to give a more sustained and further boost to keep the economy going, ” it said.
We're sorry, this article is unavailable at the moment. If you wish to read this article, kindly contact our Customer Service team at 1-300-88-7827. Thank you for your patience - we're bringing you a new and improved experience soon!
What do you think of this article?
100% readers found this article useful