Since the COVID19 outbreak, many industry players in Malaysia have taken a hit, with the government forced to come up with an economic stimulus package that will be announced on Feb 27, to mitigate the impact. Malaysian Media recently asked Nordin Abdullah the following question. How do you think the government can best come up with something sustainable, what in your opinion should be included in the stimulus package?
The is an opportunity in the wake of the COVID19 crisis to change strategy and policy for governments and the corporate sector alike, and to look at not just trying to survive the fallout of the COVID19 Outbreak.
2019 MEF predicted 30,000 to 40,000 lay-offs, and it really happened. Experts say we’re looking at a possible 100,000 retrenchment nationwide. This may happen, some sectors will be hit harder than others. Yet there are sectors that will do well and are indeed hiring more staff to meet demand.
The best way for stimulus package to be effective is to take into consideration the new reality that global producers are starting to look at in the wake of this virus. It has become a risk for companies to solely rely on china for production. This can be seen in the critical minerals and critical components part of the supply chain.
Malaysia should take advantage of this crisis to grow investments which will in turn grow the required jobs in the economy.
Many companies that have been hit the hardest are those companies that relied too much on countries like China for cheap components or indeed finished products. The question for Malaysia will be can the country develop an investment strategy that is cognisant of the fact that companies need to move components of their supply chain away for single source mega factories like found in China.
Recently the US and Australia signed a pact on critical minerals to ensure supply of baseline materials needed in the automotive, aerospace and technology sectors. The ministries in Malaysia that to be aware of this shift and develop policy to take advantage of these shifts.
A simple gap analysis will reveal that the workforce in Malaysia will need to gear up for this shift. At the same time considerable amounts of investments will be required in the infrastructure and machinery to mine and process those minerals currently present in Malaysia for global consumption.
At the same time the stimulus package needs to ensure that the industries that we have already developed in the country are given the resources to survive this short-term crisis. The funds within that stimulus package need to reach industry as quickly as possible to allow business to survive.
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