Malaysia’s 2020 GDP at 2016’s level if MCO not lifted now

Kuala Lumpur, 4 May 2020- The country’s 2020 gross domestic product (GDP) could hit the 2016 level if the Movement Control Order (MCO) is prolonged and the government is not taking steps to lift it by phases, said Minister in the Prime Minister’s Department (Economy) Datuk Seri Mustapa Mohamed.

In 2016, Malaysia’s GDP stood at RM1.23 trillion. Last year, the GDP grew 4.3 per cent to about RM1.48 trillion.

Mustapa said while health remains the government’s top priority, it is equally important to ensure the economic livelihood of the rakyat.

“The Malaysian Institute of Economic Research (MIER) has projected 2.4 million unemployment rate in Malaysia if the MCO is prolonged, meaning a lot of businesses are halted during this period. We already heard that people are losing jobs during this period.

“The country’s unemployment rate has been stable for the last few years at around 3.2 to 3.3 per cent. Bank Negara Malaysia expects this rate to go up to 8.0 per cent if no actions is being taken.

“We hope we can contain this numbers when we implement the conditional MCO,” he said during a live dialogue session on RTM last night.

In fact, he said Malaysia government’s decision to implement conditional MCO from today (May 4) was taken as the country had fulfilled World Health Organisation’s (WHO) conditions in order to lift restrictions in phases.

According to the WHO, the six criteria are transmission is controlled, health system capacities are in place, outbreak risks are minimised, preventive measures are in place, importation risks can be managed and communities are fully educated, engaged and empowered to adjust to the “new norm”.

According to Prime Minister Tan Sri Muhyiddin Yassin, Malaysia had incurred an estimated RM63 billion losses since MCO came into force on March 18.

He said the country would incur another RM35 billion losses if the MCO is extended for another month, bringing the total losses throughout the enforcement period to an estimated RM98 billion.

Muhyiddin said the country was losing an estimated RM2.4 billion daily throughout the enforcement of the MCO, which is currently in its fourth phase until May 12.

-New Straits Times