A need for third economic stimulus package
Zaidi Isham Ismail, NST
MALAYSIANS heaved a huge sigh of relief when the RM250 billion economic stimulus package was rolled out recently.
The people felt the positive vibes as soon as Prime Minister Tan Sri Muhyiddin Yassin announced it. Social media filled to the brim with accolades for the government’s caring package.
Moving forward, economists said there is still ample room for additional aid to be injected in the future. This is because the pandemic could be a protracted affair with its effects lasting well into the second half of the year.
Therefore, there is a need for additional economic buffer to cushion the blow.
The World Bank, the International Monetary Fund and numerous ratings houses such as Fitch Ratings have warned of challenging times ahead. The impact of the pandemic on the global economy could last for the next two years.
Thus the country and its people must be cognisant of the fact that Covid-19 could last much longer.
Towards that end, tongues are already wagging among local financial experts on the need for a third stimulus economic aid.
For Sunway University Business School senior lecturer Professor Dr Nur Ain Shahrier, the answer is a definite yes.
She said many small and medium scale enterprises (SMEs) are registering zero revenue as we speak.
“The relief facility and loan moratorium announced by the government takes time to be approved and for some, their cash flows can’t even survive more than a week.
Thus there is a need for a third stimulus package. And also, given that there are so many uncertainties of forecasts around the spread of the disease and the state of our economy, a third round of stimulus package is possible, said Nur Ain.
This is the hard reality, as the first phase of the Movement Control Order (MCO) ended on Tuesday. As we wait for data from the Health Ministry on whether the MCO will be extended to April 30 from the initial April 14, the Finance Ministry must also prepare for the long haul.
Putrajaya has to reassess the situation and take stock of the whole situation at least for the next 6 months.
In the meantime, let us heed Health Ministry director-general Datuk Dr Noor Hisham Abdullah’s call: “It is up to me and you.”
Nur Ain said, regardless of whether the MCO is lifted as planned on April 14, the next stimulus package should still be launched.
The third aid will act as an additional catalyst for the economy to recover, create jobs and consolidate as it reels from the deadly contagion.
The government, especially the Finance Ministry, needs to go back to the drawing board. Never mind if the economy temporarily stretches into fiscal deficit. Now is the time to save the people.
