KUALA LUMPUR – The implementation of the conditional movement control order (CMCO) in Selangor, Kuala Lumpur and Putrajaya may be the final straw for thousands of businesses that are already struggling to stay afloat.
It does not include those that have already gone under since the first phase of nationwide MCO in March.
Yesterday Defence Minister Datuk Seri Ismail Sabri Yaakob announced that all businesses have to abide by new operation hours, from 6am to 10pm.
SME Association of Malaysia president Datuk Michael Kang said small and medium enterprises will have a challenging time balancing the books, with many having already stretched their finances to the limit.
He estimated that, with the latest CMCO, up to 30% of some one million SMEs in the country may close down by year end.
“Before the loan moratorium ended last month, we did a survey and found that 20% of SMEs said they would close. Now, with another round of CMCO, the figure may go up to 25% or 30%.
“This is taking into account operational cost, cost of compliance (to the government restrictions) and loan repayment,” he told The Vibes .
He was responding to the federal government’s decision to implement CMCO in Selangor, KL and Putrajaya for two weeks beginning midnight, following a spike in Covid-19 cases in the Klang Valley.
Although economic activities will be allowed during this period, many businesses have expressed concern that the restrictions put in place could hamper operations.
Among others, no cross-district travel is allowed without employer approval letters, no social gathering and only a maximum of two people per household are allowed in a car to buy groceries.
Kang said retailers operating in malls will be the worst hit by these restrictions, as it may force the public to stay at home.
“The retailers have never truly recovered from the first round of MCO. If the government doesn’t do anything to assist these businesses, more will be forced to shut down in the next three months.”
He said the government provided a 50% subsidy on store rentals to help retailers survive, as well as tax relief for the year.
Kang expressed hope that the current CMCO will not be extended beyond October 27, saying that most businesses cannot cope with the economic fallout.
He said if there is to be more restrictions and lockdowns in the future, it should be limited to political activities, pointing to the recent resurgence of Covid-19 infections.
Cases have seen a surge since the Sabah by-election – which in itself was caused by a political crisis in the state – with a lack of SOP and restrictions leading to the spread of the virus.
“Suspend all political activities until things are under control, that’s the most important thing. What we need now is to focus on the economy and fighting Covid-19. This is all our responsibility.
“The main issue we are facing today is putting food on the table, not more political drama.” – The Vibes, October 14, 2020
