The Sun Daily
16 February 2022
Govt to focus on two main thrusts to support economic growth
KUALA LUMPUR: The government will focus on two main thrusts to support the economic growth momentum this year, namely creating jobs and helping entrepreneurs to grow, said Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz.
He said this entails the creation of 600,000 job opportunities under the RM4.8 billion JaminKerja initiative to help in the Keluarga Malaysia income recovery, as well as the RM40 billion Semarak Niaga initiative for entrepreneurs.
“The government will also closely monitor any inflationary pressures, especially on food items, and ensure that appropriate measures are taken to alleviate the people’s concerns about their survival,” he said on Astro Awani’s Awani Agenda programme on the topic ‘Keluarga Malaysia’s Economic Resilience’ yesterday.
Tengku Zafrul said the Ministry of Finance (MoF) and the government have always been responsive in ensuring that the entire Keluarga Malaysia and business communities are well-supported, especially towards strengthening the country’s economic recovery.
He highlighted that the nation’s gross domestic product (GDP) grew by 3.1% in 2021 compared to the 5.6% contraction in 2020, thus reflecting the effectiveness of the government’s aid and economic stimulus packages totalling RM530 billion.
“The growth was also supported by the success of the National Covid-19 Immunisation Programme, which has been further enhanced by booster doses and the expansion of the programme to include children.
“Additionally, it was also supported by the systematic National Recovery Plan where all states have successfully transitioned to Phase 4; and almost all economic sectors and social activities have been allowed to resume,” he said.
The Finance Minister noted that in terms of sectoral growth, the manufacturing sector took the lead with a growth of almost 10%, followed by the services sector (+1.9%) and the mining and quarrying sector (+0.7%).
“Meanwhile, other sectors recorded a lower contraction rate, thus reflecting the country’s recovery,” he said.
Tengku Zafrul said the unemployment rate had also dropped to 4.2% at end-December 2021 from a high of 5.3% in May 2020.
“This clearly shows that the government’s initiatives towards job creation have been effective, supported by foreign trade which exceeded RM2 trillion as well as the net foreign direct investments which stood at more than RM50 billion in 2021.
“So, with all the initiatives and plans made under Budget 2022, we project that the GDP will grow between 5.5% and 6.5% in 2022,” he said.
He noted that Budget 2022 was Malaysia’s largest budget to date, with an allocation of RM332.5 billion, reflecting the government’s commitment to not compromise in ensuring the well-being of all Malaysian families and business continuity through an expansionary fiscal policy.
“However, the provision of allocations and measures alone would not be enough. We need to ensure the effectiveness and delivery of the Budget 2022 initiatives.
“To this end, the Budget 2022 Monitoring Committee chaired by the prime minister has been established to monitor the implementation and performance of various Budget 2022 initiatives and recommend appropriate solutions and interventions to ensure the smooth implementation of the initiatives,” he added.
Tengku Zafrul also said the Semarak Niaga initiative with a value of RM40 billion is provided to restore the capability and ensure the viability of the business sector, particularly during the post-pandemic period.
“What is important is holistic government support, where all levels of entrepreneurs and businesses are supported, from the micro level to companies listed on Bursa Malaysia,” he said in the interview with Astro Awan.
“The government is also aware of the importance of supporting micro-businesses, especially to help them recover after the pandemic.”
The RM40 billion breakdown includes RM1.8 billion microcredit through agencies such as BSN, Tekun, Agrobank, Bank Rakyat and Bank Negara Malaysia (through commercial banks).
The measures include equity/alternative financing (RM2.2 billion), SME Soft Loan (RM14.2 billion) and Syarikat Jaminan Pembiayaan Perniagaan guarantees (RM22 billion including a special bumiputra allocation of RM2 billion).
One of the features specially negotiated by the MoF when drafting the measures for Semarak Niaga is the moratorium feature, where borrowers can get a moratorium of at least six months (up to 12 months under Tekun). Even though not for the entire period, at least they can get zero per cent for six months.
Apart from that, cooperatives also benefit from Semarak Niaga through the Cooperative Movement Economic Transformation Programme (RM10 million), Cooperative Economic Recovery Intervention financing programme (RM30 million) and Preparation of food truck business sites in urban areas (RM1.75 million), he said.
As for the tourism sector, he said the government is aware that when the borders are reopened, the capacity that has already been developed is needed to maximise revenue potential in the sector.
So, to rebuild the tourism sector, the government has allocated RM1.6 billion in Budget 2022. This includes wage subsidies to industry players that will benefit 330,000 workers and involve an allocation of RM600 million; also RM600 million under Penjana Tourism Financing and Special Assistance to more than 20,000 tourism operators registered under Motac for a period of three months with an allocation of RM85 million. Special individual income tax relief for domestic tourism expenditure up to RM1,000 is also extended until the year of assessment 2022.
Tengku Zafrul also stressed that the MoF will always be responsive to the needs of the people and businesses in taking steps that will accelerate their respective recovery efforts. – Bernama
(Web source: https://www.thesundaily.my/business/govt-to-focus-on-two-main-thrusts-to-support-economic-growth-CI8864545)