{"id":5123,"date":"2020-07-19T16:53:06","date_gmt":"2020-07-19T08:53:06","guid":{"rendered":"https:\/\/newmalaysiatimes.com\/?p=5123"},"modified":"2020-07-19T16:53:12","modified_gmt":"2020-07-19T08:53:12","slug":"world-bank-malaysia-riding-out-covid-19-storm-comparatively-better","status":"publish","type":"post","link":"https:\/\/newmalaysiatimes.com\/?p=5123","title":{"rendered":"World Bank- Malaysia riding out COVID-19 storm comparatively better"},"content":{"rendered":"\n

KUALA LUMPUR, July 19 — Despite the numerous challenges brought by the COVID-19 pandemic, Malaysia is riding out the severe economic downturn comparatively better than many economies, said the World Bank.<\/p>\n\n\n\n

Country director for Brunei, Malaysia, the Philippines, Thailand, East Asia and Pacific, Ndiam\u00e9 Diop said Malaysia\u2019s economy rests on strong fundamentals.<\/p>\n\n\n\n

The country\u2019s\u00a0diversified economic structure,\u00a0sound financial system,\u00a0effective public health response and proactive macroeconomic policy support have all helped to soften the pandemic\u2019s blow, he said in a statement today.<\/p>\n\n\n\n

\"world<\/figure><\/div>\n\n\n\n

\u201cWhile we expect the economy to see a sharp contraction this year with gross domestic product shrinking by 3.1 per cent and a particularly pronounced contraction in the second quarter, there is light at the end of the tunnel,\u201d he said.<\/p>\n\n\n\n

The World Bank estimates that 90 per cent of the world\u2019s economies would see a contraction this year.<\/p>\n\n\n\n

\u201cThe impact from the pandemic is expected to lead to the first increase in global extreme poverty since 1998, effectively wiping out the progress made since 2017,\u201d he said.<\/p>\n\n\n\n

Diop noted that the Malaysian government has deployed a six-stage strategy to build resolve, resilience and to restart the economy, adding that the country is currently on the recovery stage; building the foundation for the later stages, namely revitalising and reforming the economy.<\/p>\n\n\n\n

\u201cThis means the government is set on not just getting out of this crisis, it is also trying to get into a better shape than it was before, so it is more able to withstand the next one,\u201d he said.<\/p>\n\n\n\n

Diop said while significant policy support has been put in place, the government might need to do more to protect those who need it most, especially vulnerable households and businesses.<\/p>\n\n\n\n

While some economic activities would rebound post-Movement Control Order, it would take some time for incomes and jobs to recover as some economic sectors, such as manufacturing, would see a faster return to growth than others, like tourism.<\/p>\n\n\n\n

\u201cThis may mean providing further rounds of financial assistance to the vulnerable, especially the Bottom 40 who lack the savings and support networks to withstand a prolonged hit to their earnings,\u201d he said.<\/p>\n\n\n\n

He said the crisis underscored the need for Malaysia to put in place a stronger social protection system that is more cost-effective and less fragmented to improve individuals\u2019 and households\u2019 welfare, both during the recovery period and in the future.<\/p>\n\n\n\n

Diop said COVID-19 caught Malaysia somewhat off-guard with limited budgetary space to respond with direct fiscal injections; noting that as the economy recovers, reforms would need to be taken to boost tax revenues, including finding new sources of revenue that are more progressive.<\/p>\n\n\n\n

A key focus also must be on upskilling and retraining the workforce for a new economy, as well as accelerating the digital agenda and bridging the digital divide, he said.<\/p>\n\n\n\n

\u201cEven before the crisis, there was a growing realisation that Malaysia needs to shift its competitive approach towards attracting higher-quality investments; a challenge which is even more critical to address now.<\/p>\n\n\n\n

— BERNAMA<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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