IT doesn’t rain but it pours. This year has not been smooth-sailing for the Penang government, which has been hit by a slew of bad news.
Like every city in the world, the state is still reeling from the economic fallout of Covid-19.
Then there was the abrupt change of the Federal Government, turning Penang into an opposition state again.
Defections jolted the Pakatan Harapan-led government slightly, with the state now having an additional four opposition members to make it seven out of the 40 assemblymen in Penang.
There was even talk that the state government would fall but I take this with a pinch of salt.
As an opposition state, infrastructure spending could be cut under the new Government.
Already, the RM100mil allocated for the proposed Penang Hill cable car project was cancelled last month.
Questions have also been raised over the fate of the RM46bil Penang Transport Master Plan as well as the Penang South Reclamation (PSR) project involving the creation of three man-made islands measuring 1,800ha near Permatang Damar Laut.
State officials, both former and current, have been in the spotlight over the RM6.3bil Penang Undersea Tunnel probe carried out by the Malaysian Anti-Corruption Commission.
But the outlook for the state isn’t all doom and gloom after all.
The manufacturing and service industries, accounting for 43.3% and 50% of the state’s gross domestic product (GDP) respectively, are moving again.
Penang Institute, the state’s think tank, points out that although Penang is relatively vulnerable to global headwinds, having a solid industrial base that has existed healthily for more than 40 years allows for swift recoveries.
Malaysian Association of Hotels Penang chairman Khoo Boo Lim was also quoted as saying domestic tourism had picked up pace again.
Several beach hotels achieved 70% to 80% occupancy while city hotels had about 40%, he said.
But the rise of the service sector, especially tourism, still relies strongly on the reopening of international borders. It could take a year or two before the industry can be back to its peak.
Down at the Penang port, container activities which are measured in twenty foot equivalent units (TEUs) are on the move again, although it would take some time to reach full capacity.
The present scenario represents a significant test case for Chief Minister Chow Kon Yeow, who has performed admirably since he took over the top post more than two years ago.
Under him, Penang was the first state to announce economic stimulus packages of RM151mil during the pandemic, coupled with several incentives of interest-free loans for small and medium scale enterprises, rental waiver for businesses and direct cash incentives for working people.
While challenges abound, Penang has proven to be resilient in every economic downturn over the last four decades or so.
But another tough hurdle may lie ahead — a snap general election may be called by Perikatan Nasional to settle scores.
It’ll be interesting to see how Chow displays his political acumen in warding off the onslaught mounted by Umno, PAS and Parti Pribumi Bersatu Malaysia on traditional Malay-majority seats presently held by PKR and Amanah.
This will test his mettle in preparing the state to face the general election, his first since becoming the Chief Minister.
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