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PETALIZING JAYA: In these times of great uncertainties, two things are certain: virtually all economic sectors have been hit hard, and the way business is done will have to undergo a major overhaul.
Barely three months have passed since the Covid-19 outbreak in Malaysia and all businesses are already faltering. From hotels to transportation, from manufacturing to retail, businesses are out of breath.
The situation is clearly reflected in Prime Minister Tan Sri Muhyiddin Yassin’s statement that the country is losing an average of RM2.4 billion per day while the movement control order (MCO) is in force.
Freight forwarders have already lost half of their potential revenue, and in the manufacturing sector, more than 50% of all companies are already taking cost-cutting measures.
In the tourism sector, hotels are closing their doors, some forever.
Executive Director of the Malaysian Hotel Association Yap Lip Seng said hoteliers are preparing for significant losses until the end of the year.
“Occupancy has dropped below 40%,” he said. Sun.
The sector could end up losing up to RM6 billion this year. Yap said that, according to a survey of 324 hotels, 20% of them have instituted pay cuts, another 20% have forced employees to take vacations without pay and another 6% have fired workers.
However, 23% of them did not apply for subsidies under the Prihatin stimulus package because they felt that the amount would not last the mandatory six months they have to retain their workers.
Malaysia Freight Forwarders Federation President Alvin Chua said the full impact of the recession will be felt in June, when the companies are expected to resume operations.
While he was unable to provide an industry-wide estimate, he said his company has already lost half of its business.
The sector represents 15% of the gross domestic product.
Malaysian Manufacturers Federation (FMM) President Tan Sri Soh Thian Lai expects the economy to take up to 24 months to fully recover.
He said he could see a partial recovery in 12 months if a Covid-19 vaccine is found.
An FMM survey of 420 companies showed that 67% will not increase the number of employees, while 59% have instituted unpaid leave and removed permits and benefits.
Some workers have been forced to take annual vacations or work fewer days a week.
Soh said 78.7% of companies are likely to reduce staff strength by 30%.
The economist of the Universiti Tun Abdul Razak, Prof. Dr. Barjoyai Bardai, said Sun It would take 12-18 months for the economy to recover, but that would depend on how quickly companies can align themselves to the “new normal.”
“Social distancing will greatly transform commercial operations. Those who cannot adapt to the “new normal” will abandon, “he said.
However, the president of the Asli Center for Public Policy Studies, Tan Sri Ramon Navaratnam, said it would be unrealistic to determine when the economy will recover.
“There are so many ever-changing factors to consider. For example, will the Covid-19 virus still exist?”
He said that even if companies start to resume operations in Malaysia, those in other countries may not be ready yet.
“That means that we will not be able to import goods or export finished products,” he said.
However, he praised the government for allowing companies to gradually restart operations.
“This is a step in the right direction and the sooner we can get the ball rolling, the better it will be for us.” However, we must be vigilant to ensure that we work under the proper regulations to prevent the virus from spreading further. “
“The public must also cooperate so that there is no spread and we don’t have to go through another scenario like this ever again,” he added.
Read this story on our iPaper:
Counting losses
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