Shifting The Malaysian Economy into Higher Gear: Statistics, Strategy, And Action
THERE IS NO RETURN TO “BUSINESS AS USUAL”
Where does the Malaysian economy stand in terms of its recovery and what are government plans for its way forward? Minister in the Prime Minister’s Department, YB Dato’ Sri Mustapa Mohamed, addressed these questions in his remarks on “Shifting the Malaysian Economy into Higher Gear: Statistics, Strategy, and Action” at the Forum.
In that speech, he acknowledged the ruinous hit to the Malaysian economy caused by the pandemic. “The pandemic resulted in cut-backs in demand, severe disruptions to the supply chain, a steep fall in income levels, and knock-on effects in troubled sectors that resulted in wide-scale retrenchment. Lives, livelihood, and businesses were severely affected. In 2020, our domestic economy contracted by 5.6%. It was our worst economic performance since the 1997 Asian Financial Crisis,” YB Dato’ Sri said.
The economy was now on the mend but there would be no question of “business as usual” as the pandemic has exposed the economy’s frailties: “Given the challenges prior to the pandemic and the new challenges arising from this crisis, the Government has recognised that we cannot adopt a business-as-usual approach in dealing with post-pandemic challenges. We need to take the bull by the horns. Some of the vulnerabilities and weaknesses exposed by this crisis are certainly not new. Hence, it is imperative that the Government takes this opportunity to reform the economy and “build back better”.
Building back better is what the 12th Malaysian Plan aims to do, while the eight stimulus packages introduced by the government seeks to shore up ailing businesses during and post-pandemic. Before wrapping up his speech, YB briefly summarised the main areas of focus: “The government’s priorities in the next five years include increasing incomes, eliminating absolute poverty, and reducing development gaps between states and regions, as well as ensuring quality growth that is sustainable.”
A member of the Economic Planning Unit, Dr Anthony Dass, who is also AmBank’s Chief Economist, then elaborated on some of the points mentioned by Dato’ Sri as well as answered questions from the audience.
The new norm, Dr Dass stressed, can no longer revert to doing business as it did, pre-pandemic. He highlighted the ways that businesses would have to evolve:
- They need to incorporate ESG (Environmental, Social, and Corporate Governance) considerations into business decisions, as climate change will have a greater impact on business and consumer trends than ever before
- Malaysian businesses have to be international in outlook, as the signing of the CTPPA (Comprehensive and Progressive Trans-Pacific Partnership Agreement) heralds a new phase of international trade and competition;
- Digitalisation is not an option for any business, and automation, including robotics, is also becoming increasingly necessary.
- Reskilling Malaysia’s talent pool is crucial; with businesses going digital and factories automating, existing graduates need to be re-assessed and reskilled to ensure they have up-to-date skill-sets.