The economy shrank by 8.3 percent during the first half of this year compared with the same period last year, according to the Department of Statistics (DOSM).
According to the department’s Malaysian Economic Statistic Review Vol 5/2020, there are signs of recovery since July.
The industrial production index (IPI, a measure of real output) had registered 1.2 percent growth in July after four consecutive months of negative growth.
Negative growth in the wholesale and retail sector was also easing. This, coupled with better commodity productions and higher exports were also positive indicators, said the DOSM.
DOSM said that the tourism industry contributed 15.9 percent of the nation’s economy in 2019.
The department noted that the government has been aiding the tourism industry by offering financing and individual tax relief of up to RM1,000 for domestic tourism expenditure.
Construction, which contributed less than 5 percent to the economy, was another sector which the DOSM believed should receive a boost.
“This sector has a high backward linkage and multiplier effect and has the ability to stimulate other sectors that lead to economic growth.
“Thus, increasing the related activities and expanding the opportunity of this sector that will push forward the momentum of the economy,” said the DOSM.
On the downside, the DOSM noted that unemployment has not returned to pre-pandemic levels and expects wages to continue to be suppressed.
“Businesses in selected industries have reported reducing monthly working hours of their employees amidst the challenging economic climate, resulting in lower salaries paid; while others have to implement pay cuts as an option to sustain business operations.
“It is foreseen that this will decrease the average and total salaries and wages paid to the employees, hence affecting decent work conditions,” said the DOSM. – MKINI
Economy recovering, bright prospects for 2021, says statistician
MALAYSIA’s economic activity outcome for the third quarter (Q3) is expected to improve, given the government’s various stimulus packages to support overall economic growth, said the Department of Statistics Malaysia (DOSM).
Chief statistician Mohd Uzir Mahidin said the economic recovery has begun with the reactivation of economic activities and was reflected by macroeconomic indicators in July, marking the preliminary indication for Q3.
“This is in line with the Leading Index, which suggests an economic recovery in the near term and projects a brighter economic prospect for next year,” he said in a statement today.
Mohd Uzir said this scenario was attributed to the increase in the total labour force at 15.82 million persons in July, from 15.76 million the previous month.
“In terms of turnover, the sales value of the manufacturing sector increased to RM119.3 billion in July, growing 2.1% month-on-month.
“Wholesale and retail trade also recovered in July, generating RM108.7 billion sales volume with a growth rate of 5.6% compared with the previous month,” he said.
The favourable sales growth in this sub-sector was largely contributed by automotive sales following the effective tax relief strategy by the government, said Mohd Uzir.
In terms of Malaysia’s merchandise trade, he noted that July recorded an increase in total trade amounting to RM159.9 billion compared to RM144.7 billion the previous month. In July, total exports increased by 11.7% while imports rose 8.7%.
On a year-on-year basis, he said exports increased by 3.1% while imports declined in July this year. In August, both exports and imports recorded a decline, however, trade balance continuously remained surplus.
Mohd Uzir also viewed the role of the tourism sector within the economy as crucial, as tourism-related activities engaged 23.6% of employment and contributed 15.9%, or RM240.2 billion, to Malaysia’s economy last year.
“The government’s tourism initiatives to spur promotional packages, had, in turn, garnered encouraging responses and reinvigorated domestic tourism activities this year,” he added. – Bernama
MKINI / BERNAMA