KUALA LUMPUR – The Budget 2021 next month will be a “make or break” economic plan for many small and medium businesses that are on the brink of shutting down since the latest conditional movement control order (CMCO) in several states.
Sunway University Business School economics professor Yeah Kim Leng said SMEs in the Klang Valley in particular will be paying close attention to the budget announcement.
The CMCO extension to November 9 has only aggravated the economic challenges, particularly for companies that are already facing serious cash flow issues, he added.
“There are numerous businesses that have been considering shutting down but are waiting to see with greater clarity what kind of support is forthcoming from the government.
“A lot of attention will focus on whether there will be further wage subsidies or other financial assistance, such as another round of stimulus package is in store in the coming budget.
“If the budget is seen to provide help, then I think most of the impacted businesses will take their chances and continue to operate longer,” he told The Vibes today.
Yeah was asked to comment on the impact of the CMCO extension in the Klang Valley by two weeks as announced by Senior Minister Datuk Seri Ismail Sabri Yaakob, and if the survival of businesses will depend on the coming budget.
While the economic sector is allowed to operate as usual during this period, many businesses have claimed to be running on losses, as the public remains prudent, financially and health-wise.
Yeah said the CMCO extension will result in businesses languishing for a longer period, as their road to recovery following the first phase of the movement control order in March may have hit a snag.
“It is due to this that government support via the budget is mightily needed at the moment, especially if the CMCO is again extended even beyond November 9.”
According to Yeah, the budget is also critical as it sets the direction and foundation for the five-year 12th Malaysia Plan, which kicks off next year.
It will be the first budget to signify strategies that will be taken by the government to help the country achieve its shared prosperity vision as well sustainable development goals, he said.
“Finally, this budget will also determine how Malaysia positions itself in the post-Covid economic landscape and the possible change in global geopolitics, especially with the looming US election.
“Beyond that, the government has to sort out the political uncertainties. Get the budget off the ground and implement it for the wellbeing of Malaysians.” – The Vibes, October 28, 2020
