KUALA LUMPUR, 8 June 2020 – Malaysia is expected to be on the path of economic recovery starting from the end of this year and return to growth into 2021, said The World Bank, as reported on Bernama.
Its country manager for Malaysia, Dr Firas Raad, said the country needed to continue with its encouraging and effective public health measures while bringing the economy back to where it was before the COVID-19 pandemic.
He said pro-growth policies, coupled with incentives to push the private sector were crucial ingredients to employ to help the nation recover from the economic downturn.
“The country first needs to continue its effective public health measures to ensure no second wave or the return of the (COVID-19) virus.
“Aside from that, (it must) continue supporting vulnerable households and focus on the firms that need support and recovery, especially the small and medium enterprises (SMEs), and then start to think about the medium-term reform agendas,” he said in The Nation programme themed “Economic Recovery Plan (The World Bank Perspective)” on Bernama TV today.
Firas said Malaysia should continue its effort on the reform agendas such as those involving governance, regulatory environment, and competition of economic sectors, as well as education reform, in its bid to achieve high-income nation status.
“For Malaysia to cross into high-income country status, it will have to boost productivity growth, and that will only come with great investment in human capital,” he said.
He added that the World Bank is in the midst of reviewing the economic impact of the COVID-19 outbreak on Malaysia’s economy before deciding whether to revise the country’s 2020 gross domestic product (GDP) growth target, sometime this month.
The bank in April cut Malaysia’s 2020 GDP growth forecast from 4.5% to a negative 0.1%, amidst the COVID-19 outbreak.
Business activities in the country are resuming as the country gradually eased the COVID-19 lockdown measures after the economic activity froze for almost two months.
Malaysia is now entering the recovery phase of COVID-19 following a declining trend of infections, while the country’s medical and public health capacity has reached a better and more convincing level.
The majority of businesses are allowed to reopen but are still subject to strict conditions, in the conditional movement control order (CMCO) that will be replaced by the recovery MCO (RMCO), from June 10 to Aug 31.