PAGOH: Financial institutions should introduce another special moratorium period to help micro, small and medium enterprises (MSMEs) struggling to manage their cash flow, says Tan Sri Muhyiddin Yassin.
The National Recovery Council (NRC) chairman said some businesses are still facing difficulties after suffering losses of 30% to 40% during the first two years of the Covid-19 pandemic, with some even going out of business.
“Even if financial institutions reintroduced another round of relief to give our MSMEs a chance to regain momentum, they would not suffer significant losses.
“About 96% of the country’s economic activities are driven by MSMEs. So, if they fail to create a competitive market, the economic recovery will be slow, and halted by the rising inflation,” he said when met by reporters after attending the Jualan Prihatin Rakyat at Bukit Pasir here yesterday.
Muhyiddin said the NRC had previously discussed this matter three times, and recommended this to the government as one of the ways to help MSMEs.
“We proposed that the government come up with a firm solution to hasten the economic recovery process and ease the burden borne by the rakyat.
“We hope that Prime Minister Datuk Seri Ismail Sabri Yaakob can find a way to help the people as the increase in the overnight policy rate (OPR) has put even more burden on them, besides the weakening ringgit.”
On Thursday, Bank Negara increased the OPR by 25 basis points to 2.5%.
In a statement, it said it raised the ceiling and floor rate of the corridor of the OPR to 2.75% and 2.25%, respectively.
This is the central bank’s third consecutive rate hike, bringing the total increase in the OPR to 75 basis point so far this year.
In July 2021, Bank Negara introduced a six-month moratorium for all individuals and MSMEs, in line with the National People’s Well-Being and Economic Recovery Package or Pemulih.
On Jualan Prihatin Rakyat, Muhyiddin said the programme is expected to be expanded nationwide as a short-term solution to help people cope with the rising cost of living.
Under the programme, daily necessities such as rice, chicken, and eggs are sold at a discounted rate.
“For RM20, they can get a 5kg bag of rice, a tray of eggs, and chicken through the programme that started in August,” he added.
