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PETALING JAYA: An economist and the director of a business association are divided on whether the snap elections can help stabilize the economy, given that the country’s current political struggle has negatively impacted the Malaysian stock market and the ringgit.
Michael Kang, president of the Malaysian Association of Small and Medium Enterprises (SMEs), called for early elections to ensure economic stability, but Geoffrey Williams of HELP University said new elections would not change the economic situation unless there were better policies.
Weak market sentiments following opposition leader Anwar Ibrahim’s announcement of having enough numbers to form a new government saw the ringgit at a nearly two-week low yesterday.
Kang said politicians should resolve the political instability in the country as soon as possible to focus more on reviving the economy.
“With this kind of (political) situation, a lot of things are uncertain. The best thing is to call early elections so that they can at least get a mandate to form a new government that can focus on economic development, ”he said.
He also welcomed the government’s new Kita Prihatin stimulus package announced by Prime Minister Muhyiddin Yassin yesterday, which included the 2.0 Wage Subsidy Program aimed at helping B40 and M40 groups, workers and micro-enterprises.
However, he said that these forms of assistance should continue regardless of who is in power, as more than 50% of SMEs are still struggling to recover from the impact of Covid-19.
“We hope they can continue this effort, whoever the government is. They must fulfill their duties to help SMEs and the rakyat, ”he said.
Meanwhile, Williams said that fluctuation in the markets was not a problem, as it happened all the time.
“As long as the government has a minimal majority, there will always be nervousness in the financial markets when something comes up that threatens the government’s mandate.
“Today’s Anwar announcement is just one of these things,” he said.
He said that under the current circumstances, other events could have a similar impact, such as bad news about the Covid-19 numbers or the election results in Sabah on Saturday.
Instead, Williams said, the real issue was the devastating impact on the economy of the Covid-19 lockdown measures, which should be reviewed.
“The political situation is important, but the economic scenario is unlikely to change unless whoever is in power changes the focus of the shutdown.
“If the snap elections resulted in a different economic policy, then they could remedy the situation. But if the result was a different government with the same blocking regulations, nothing will improve in economic terms. “
