Economist: Aid will help ease economic pain of all affected sectors

SERC executive director Lee Heng Guie.

PETALING JAYA: The latest stimulus package worth RM150bil by the government is both comprehensive and timely for businesses as well as the people, says economist Lee Heng Guie.

He said the Pakej Perlindungan Rakyat dan Pemulihan Ekonomi (Pemulih) would help ease the economic pain of all sectors affected by the pandemic.

“It covers everything in whatever form of relief they can provide to give assistance to all the affected sectors. Of course, there are some sectors that are still struggling but there is also aid for those in the tourism sector.

“The automatic loan moratorium would definitely be a relief for those who are really in need this time, ” said Lee, who is executive director of the Socio-Economic Research Centre, the think tank of the Associated Chinese Chambers of Commerce and Industry of Malaysia.

“Hopefully we will see a more gentle impact on the economy as we go from the second quarter to the third quarter. We hope this will also ease the pain and avoid a sharp dent on the recovery phase of businesses and the economy, ” he said.

He noted it was also important for these measures to be implemented swiftly by disbursing the financial assistance whether it was by cash handouts or by people applying for the loan moratorium or for EPF withdrawals.

“On the business side, as expected, they addressed the 3Cs – cash flow, credit and cost – suffered by businesses including the wage subsidy programme, loan moratorium as well as by increasing the size of some funds. All this will definitely be helpful for businesses who are in need of financial assistance, ” he said.

Malaysian Industrial Development Finance Bhd head of research Imran Yassin Md Yusof also said Pemulih was timely given the economy, and more importantly the rakyat, required further support due to the extension of phase one of the NRP.

From an economic perspective, Imran Yassin said the fiscal stimulus could be categorised into two: pro-consumption and pro-business.

“The additional allocation of Bantuan Prihatin Rakyat or households and bachelors earning RM5, 000 and below, the i-Citra EPF withdrawals, the opt-in blanket loan moratorium, and the wage subsidy programme for all economic sectors are some of the pro-consumption initiatives underlined in the package.

“It is expected to provide some assistance to the needy, at least to cover their basic spending needs amid this hard time, ” he said.

Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the government had so far announced eight fiscal stimulus packages, since March last year.

He said this showed the government’s commitment to ensure that everyone’s plight was being taken care of.

“During the US Subprime Crisis back in 2007 and 2008, there were only two fiscal stimulus, totalling around RM10bil as opposed to now which is about RM530bil.

“Hence, the financial assistance has been rolled out in order to minimise the economic impact. What is more important now is how all Malaysians work together to adhere to the SOP in order to allow for us to move from Phase One to Phase Two (of the NRP) and so on, ” he said.

Mohd Afzanizam believed only when the economy was fully reopened, then all economic stimulus would work its way through, otherwise, there would always be a stumbling block for a holistic economic recovery.