MP SPEAKS | Govt should borrow RM45bil from debt market to aid M'sians

MP SPEAKS | Malaysians can only benefit, and Prime Minister Muhyiddin Yassin has nothing to lose by borrowing RM45 billion from the RM1.3 trillion domestic debt market to help financially troubled companies and Malaysians face the adverse economic impact of the total lockdown.

Muhyiddin has created history by being the first prime minister in history, where the king has taken the unprecedented step of consulting all leaders of political parties, including opposition parties, on the emergency, the Covid-19 health crisis, the economy and parliamentary democracy.

The Perikatan Nasional (PN) government must announce a whole-of-society economic stimulus package that can inject RM45 billion to save jobs, businesses and economic livelihood of Malaysians following the extension of the current movement control order (MCO) for another 14 days until June 28.

Previously, Muhyiddin had announced a RM40 billion Pemerkasa Plus economic stimulus package with only RM5 billion in new funding following the first total MCO lockdown for 2 weeks on June 1.

Since the total lockdown is going to be extended by another two weeks, there must be another financial aid package to help distressed companies and displaced workers. Even PN cannot deny that the whole-of-government’s failure to contain Covid-19 has tragically led to Malaysia’s record number of Covid-19 cases and deaths.

With an estimated RM2.4 billion in daily losses similar to during MCO 1.0, the country’s economic losses are estimated to be at least RM60 billion. A RM45 billion cash injection into the economy will help to mitigate this best case scenario of RM60 billion losses. DAP reiterates that the cash injection of RM45 billon into the economy must directly benefit workers and business encompassing:

• An increase in monthly welfare payments to RM1,000, including the unemployed, costing RM7 billion for the remaining seven months of the year until the completion of the National Immunisation Programme (NIP) by December 31, 2021 to achieve herd immunity of at least 80%;

• an automatic extension of the moratorium of bank loan repayments, excluding the Top 20 percent, until the NIP is completed by the end of the year. This will help 8 million Malaysian individuals and companies. The cost should be borne by the banking industry, which recorded healthy profits after tax of nearly RM23 billion for 2020 as compared to RM32.3 billion in 2019;

• work hiring incentives over a period of two years, comprising wage incentives of RM500 a month to local employees and hiring incentives of RM300 per month to employers, creating employment for 300,000 Malaysian workers costing RM6.5 billion per annum. Youth unemployment is still at a high of 13.4 percent in March 2021;

• RM3.5 billion for the Health Ministry to ramp up NIP, accelerate the 3Ts of testing, tracing and treatment, upgrade hospital capacity and capability as well as medical equipment and human resources to avert the collapse of our public healthcare system; and

• RM28 billion in the form of financial grants; wage, rental and utility subsidies; loan guarantees and credit extensions; for the small and medium enterprises, construction, retail and the crippled tourism industry.

What is needed to pull out of an economic recession is serial financial aid on a regular basis to save jobs, businesses, and economic livelihood. The old method of one-off aid is a financial band aid that will not protect the economic livelihood of ordinary workers and financially distressed Malaysians.

Financial assistance should not be limited to B40 but also the M40 group to prevent them from slipping down into the B40 group. Just as in refusing to convene Parliament even though all MPs have been vaccinated, an extension of the two-week lockdown without any additional financial aid is irresponsible and unreasonable.

LIM GUAN ENG is DAP secretary-general and Bagan MP.

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