MICCI says more effective stimulus package needed for businesses

KUALA LUMPUR (March 31): The Malaysian International Chamber of Commerce and Industry (MICCI) says the Prihatin Rakyat Economic Stimulus Package is imbalanced between the support to employees and employers.

“We believe that the Prihatin package, though rakyat-centric, is missing the mark, as businesses, especially the SMEs, are the largest employers of the rakyat and the largest tax contributors to the country.

“Cash handouts are only good for the moment but the rakyat needs continuous and secured employment, as well as income beyond three months. Deferment of loans and financial obligations of the rakyat is merely delaying the inevitable,” MICCI president Datuk Tan Cheng Kiat said in a statement.

Tan said the survival of businesses is the key that ultimately leads to economic resilience and employment sustainability.

“The government should provide a more effective stimulus package to businesses, instead of unsustainable ones. Bottom line, what is needed is to ensure that businesses being the engines of the economy, driver of growth and providers of employment, survive this current crisis. If not, it benefits no one.

“We urge the Government — protect the goose that lays the eggs, feed it to ensure it continues to lay eggs,” he added.

Tan called on Putrajaya to adopt wage subsidy measures that have been announced in countries such as Singapore, Germany, Canada and UK, where the balance between employees and employers are taken into account.

“The prime minister has stated that no one will be left behind and it really has to cover the whole chain within the economy. If businesses falter, everyone will be left behind,”

On the matter of approving business operations during the Movement Control Order (MCO), MICCI said it had earlier provided feedback to the Government on March 17, raising concerns that consistency was needed for approvals and suggested to include consideration on the entire supply chains.

Tan added: “We suggested that for those companies that are approved to operate, government shall grant automatic inclusion of their respective second and third tier suppliers in addition to the first tier suppliers.”

“[Otherwise, approved companies are] about to run out of supplies as second and third tiered suppliers are not allowed to operate.”

MICCI also urged the government to provide clear transporter guidelines for the authorities manning the roadblocks, as there have been inconsistencies.

Meanwhile, for the companies that are granted approval to operate, MICCI proposed to allow replacement workers to replace absenteeism and changes in the production plans from the original list of workers submitted for approval.

Other proposals by the chamber includes, clearer definition of “essential items”; releasing GST refunds and government procurement payments outstanding to disseminate quick cash flow; granting cheaper below commercial rates business loans pegged to payroll costs; waiver on employer’s contribution for 6 months; removal of wage subsidy condition and cash handouts.

To ensure sustainability of employment and the country’s fiscal health post MCO, the chamber asked for gradual allowing by sectors of non-essential operators to commence business after the lockdown period.

“The first should be those that supply to the MCO exemption companies (second and third tier supply chain), followed by medium sized factories that have the resources and capabilities to provide the sanitary and social distancing, followed by small businesses with staff levels of between two to 10.”

“A small operator of even 100% staff is significantly less than an approved operator with 50% staff level in the hundreds,” it added.

The MICCI also called on the government to consult the chambers or business associations who are at ground level, in the policy development process, especially during this critical period.

It emphasized that the survival of businesses is key to the country’s economy recovery and thus, in turn ensures the rakyat’s sustained employment

“Giving out eggs is fine but don’t forget to feed the goose, otherwise the goose may die and everyone will be left behind,” it said.

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