MONTHLY NEWS SCAN

Tinjauan Berita Bulanan Compiled by IDS

Vol. 25 Issue 4 IDS Online http://www.ids.org.my 1 – 30 April 2020

HIGHLIGHTS again from the global coronavirus Index since it began more than two FOCUS pandemic. The poll found China’s decades ago. The report is a grim gross domestic product (GDP) was preview for European leaders, who Coronavirus: World economy expected to grow just 1.3% in the will discuss a possible 2 trillion-euro • current quarter on a year earlier, after (S$3.1 trillion) rescue plan for the ‘may face double recession’ contracting 6.8% in January-March. region. (23 April, The Straits Times) • Coronavirus: Asian economies won’t grow this year, says IMF (23 April, Reuters) • more resilient than many Aussie economy to shrink 10% in countries: World Bank Japan’s factory output, retail sales first half-year: RBA: Australia will • Malaysia’s economy to bounce slump as virus hits economy: suffer its biggest economic back to 9 percent in 2021, says Japan’s March factory output fell at contraction since the 1930s in the first IMF the fastest pace in five months, while half of this year due to coronavirus- • RM553m additional expenditure retail sales also dropped as businesses driven mobility curbs, the central bank enactment passed struggled with the coronavirus governor said. Reserve Bank of • 169,630 Covid-19 aid recipients pandemic’s sharp hit to overseas and Australia (RBA) governor Philip targeted domestic demand. The global Lowe said in a speech in Sydney that economy could suffer its worst the country's national output would INTERNATIONAL downturn this year since the Great fall by around 10 per cent in the first ANTARABANGSA Depression of the 1930s due to a half-year, with most of this decline virus-driven collapse of activity, with taking place in the April-June quarter. Coronavirus: World economy ‘may Japan’s economy facing stagnation Unemployment is likely to be around face double recession’: The world due to its export dependence and soft 10 per cent by June as total hours economy already faces an economic domestic consumption. (30 April, worked are likely to decline by around downturn worse than the Great Reuters) 20 per cent, he added. (22 April, The Depression. But this could be Straits Times) followed by another “possibly much Singapore sees sharper economic worse downturn”, according to the slump on global coronavirus Coronavirus: Huge economic spread: Singapore is bracing itself for Economist Intelligence Unit (EIU). rescue plan agreed by EU leaders: A World governments are giving a sharper economic contraction this year than an earlier forecast of a slump plan for injecting billions of euros of trillions of dollars in stimulus emergency aid into Europe’s battered packages to help prop up their of as much as 4 per cent, as the coronavirus pandemic continues to economies has been agreed by EU economies. Sovereign debts that they heads. Meeting via video, they agreed are racking up may push the global spread globally and disrupts supply chains. The city-state is “very likely” to set up a massive recovery fund, economy into a second recession, the closely tied to the bloc’s seven-year EIU warns. (15 April, BBC News) to see a steeper fall in gross domestic product (GDP), Trade and Industry budget. They also confirmed that Coronavirus: Asian economies Minister Chan Chun Sing said on €540bn (£470bn) of financial support won’t grow this year, says IMF: Thursday (April 23) in an interview would be released through existing Economies in Asia will see zero with Bloomberg Television's Haslinda mechanisms from 1 June. European growth this year for the first time in 60 Amin. “We are really concerned that Commission chief Ursula von der years, the International Monetary worldwide, this is going to lead to a Leyen said the fund would mobilise Fund (IMF) has said. Its bleak outlook more serious problem than many had €1 trillion of investment. (23 April, for the region comes as it warns the anticipated just a month ago.” (23 BBC News) global economy will face the “worst April, The Straits Times) recession since the Great Depression”. Coronavirus: Eurozone economy Asia’s service sector in particular will Europe’s coronavirus lockdown shrinks at record rate: The eurozone struggle to rebound, it said. Airlines, pushes economy into record economy shrank at the sharpest pace factories, shops and restaurants have slump: Europe’s economy suffered a on record in the first quarter as the been “hard hit” by national massive blow in April when Covid-19 pandemic forced countries lockdowns. (16 April, BBC News) government restrictions to contain the into lockdown.A first estimate of GDP coronavirus left companies between January and March showed a China on slow road to recovery, but scrambling to stay afloat. An estimate contraction of 3.8%, worse than recession risk is high: Reuters poll: of private-sector activity in the euro during the financial crisis. Separate The Chinese economy will slowly area plunged to just 13.5 from 29.7 in figures revealed a steep fall in recover from its first quarterly March, according to IHS Markit on economic activity in France and Spain contraction since current records Thursday (April 23). The drop was far over the same period. In Germany, began, economists predicted in a sharper than economists had unemployment has increased though it Reuters poll, but they warned of a anticipated and marks the lowest remains relatively low compared with likely recession if conditions worsen reading for the Purchasing Managers’ other nations. (30 April, BBC News) 1 – 30 April 2020 MONTHLY NEWS SCAN (Tinjauan Berita Bulanan) 1 year to post a gross domestic product Malaysia to reset its aviation industry NATIONAL (GDP) of RM1.47 trillion under the and become profitable, says an NASIONAL best possible scenario, if the analyst. Sobie Aviation independent Movement Control Order (MCO) only analyst and consultant Brendan Sobie Malaysia more resilient than many lasts until April 28, according to a said the local aviation industry was countries: World Bank: The World think tank. The country’s economy already at a critical juncture even Bank says Malaysia will be deeply can also contract 1.02 per cent with a before COVID-19, with all six airlines affected by the Covid-19 shocks but GDP of RM1.41 trillion under the unprofitable in 2019 and the market there are a slew of factors that make it worst case scenario, according to the suffering from overcapacity. The more resilient than many other Malaysian Institute of Economic government, he said, has a lot of countries. Malaysia has, among Research (Mier). Mier Deputy others, a diversified economic Director Professor Dr Jamal Othman initiatives for a reset, but the situation structure and sound track record of said this was based on the world oil has become more important now as macroeconomic management, the price of around US$35 per barrel in the industry is bleeding really badly World Bank Malaysia lead economist the second half of 2020 and and the potential for a collapse is real. Richard Record said. It also has deep throughout 2021, besides the (30 April, ) domestic capital markets, astute government’s RM260 billion Prihatin financial institutions, and past stimulus package. (24 April, Business Malaysia stuck in middle-income experience responding to crises, Times) trap: Moody’s Analytics: Malaysia Record said. “While the challenges now faces the challenge of ahead are unprecedented, because of Government formulating economic maintaining its competitive edge these reasons the country is well recovery plan for short, medium against both ends of the value chain placed to weather the storm,” he and long term: Prime Minister Tan namely low-wage countries on one added. (15 April, Business Times) Sri Muhyiddin Yassin has directed the side and advanced and more Ministry of Finance, Economic innovative countries on the other, said Malaysia’s economy to bounce back Planning Unit (EPU), and the Prime Moody’s Analytics. Moody’s to 9 percent in 2021, says IMF: The Minister's Department to formulate a Analytics said Malaysia ranks as the International Monetary Fund (IMF) comprehensive Economic Recovery third richest country in Southeast expects Malaysia’s economy to Plan for the short, medium and long bounce back to grow a whopping nine term. He said the plan was aimed at Asia, successfully transforming its per cent next year, from an expected ensuring the economic activities could economy from an agricultural-based 1.7 per cent contraction in 2020. This be revived quickly after the one to a manufacturing hub with one will be the fastest among Asean-5 Movement Control Order (MCO) of the busiest ports in the world. economies, which according to the period has ended. “The focus “Income inequality has been a IMF is likely to expand at an average currently is to identify measures and growing issue between Malaysian 7.8 per cent next year. Asean-5 also initiatives that can spur economic states, particularly the richer comprises Indonesia, Thailand, the growth in the short and medium term, manufacturing hubs and states that Philippines and Vietnam, whose gross as well as to encourage confidence of rely on agriculture and other natural domestic product (GDP) are projected the people and investors to regenerate resources like palm oil and mining. to grow 8.2 per cent, 6.1 per cent, 7.6 the nation’s economy. (23 April, (29 April, Business Times) per cent and 7 per cent respectively. Bernama) Malaysia’s solid projection will also Govt committed to helping SME set to outpace the global GDP growth. Malaysia’s trade in Feb 2020 weather economic challenges - PM (16 April, Business Times) expands 11.6 pct to RM136.28 bil: Muhyiddin: The government will Malaysia’s trade in February 2020 ensure that the local small and Malaysia to experience short-term grew 11.6 per cent year-on-year medium enterprises (SME) sector will benefit from China: RHB (YoY) to RM136.28 billion from remain resilient and sustainable in Investment Bank said Malaysia is RM122.14 billion recorded in the facing the current economic expecting a short-term benefit from same period a year ago, according to the reopening of China’s International Trade and Industry challenges, especially the cash flow economy after COVID-19 but the Ministry (MITI). The agency said problem during the Movement general weakness is likely to kick in as higher trade was recorded with the Control Order (MCO) period, recession seems to be looming. It said United States (US), Singapore, the said Tan Sri Muhyiddin Yassin. The supply disruption in China has led to a Republic of Korea (ROK), China and prime minister said this is because the spike in Malaysia’s exports and Taiwan. Exports picked up sharply by SME is a key sector, accounting for imports, with exports of commodities 11.8 per cent to RM74.45 billion in more than two-thirds of the jobs in the as well as electrical and electronics February 2020, compared to a 1.5 per country and almost 40 per cent of the pulled the overall exports upward. The cent decline in January 2020 while Malaysian economy. Therefore, the Department of Statistics Malaysia imports expanded 11.3 per cent to government is committed to helping recently shared the country’s trade RM61.83 billion. (3 April, Business ease the financial burden of SME figure for the month of February Times) now, apart from ensuring that they showing the number rising from 11.6 fully benefit from the aid provided per cent to RM136.3 billion compared COVID-19 an opportunity for under the Prihatin Rakyat Economic to the same month in the previous Malaysia to reset aviation industry Stimulus Package (PRIHATIN) and year. (22 April, Bernama) – Analyst: The COVID-19 pandemic SME additional package of RM10 Malaysia’s GDP to grow -1.02 pct to which has caused global economic billion which were unveiled recently, 3.8 pct this year: MIER: Malaysia’s shutdown with the risk of recession he said. (25 April, Bernama) economy can grow 3.8 per cent this somehow provides an opportunity for 1 – 30 April 2020 MONTHLY NEWS SCAN (Tinjauan Berita Bulanan) 2

not store enough that come from water give focus to the growth of its main LOCAL gravity resources. (22 April, Daily productive sectors namely tourism, TEMPATAN Express) industry and agriculture in a bid to speed up the development of the RM553m additional expenditure RM2m to convert Likas sport hall state’s economy. The Yang Dipertua enactment passed: The State into Covid-19 ward: The State Negeri of Tun Juhar Legislative Assembly recently passed Government has allocated RM2 Mahiruddin said the focus is in the First Supplementary Supply million to turn the hall in Likas Sports tandem with the re-alignment of the (2020) Enactment 2020 to take out a Complex as a makeshift facility to state government to ensure Sabah’s total of RM553 million from the handle Covid-19 patients. Chief development policy stand on firm Consolidated Fund for additional Minister Datuk Seri Mohd Shafie ground. The industrial sector, expenditure this year. Tabling the Bill Apdal said: “The hall will be modified especially manufacturing-based, on Tuesday (21 April) , Chief to become a branch of Queen would be given focus on becoming a Minister-cum-Finance Minister Datuk Elizabeth Hospital to accommodate catalyst in generating more Seri Mohd said the the placement and additional employment opportunities for the Sabah Covid-19 Aid Package that was healthcare centre with the expectation people especially during the announced on March 25, this year, of the increasing number of Covid-19 implementation of the 12th Malaysia involves such additional provision cases.” “The proposed facility will be Plan (2021-2025). “This is aimed at accelerating the transformation of (RM553 million), besides from able to cater about 170 patients. I will Sabah’s economic structure to become getting less revenue collections that inspect the preparation done at the an industrial state. (16 April, could not be collected by the State centre, in terms of beds and basic Bernama) government or local authorities (PBT) amenities,” (21 April, Daily Express) and giving some discounts on Over RM11 mln worth of payment of electricity bills. (23 April, RM6 mln to upgrade Pitas road – contributions to combat Covid-19: Daily Express) Peter: Sabah Infrastructure The State Government has received Development Minister Datuk Peter contributions worth RM11,380,000 in 169,630 Covid-19 aid recipients Anthony announced RM6 million cash and kinds from State statutory targeted: The State Government is allocation to upgrade Jalan bodies, NGOs and the private sector in targeting some 169,630 recipients for Salimpodon Darat, Pitas. Peter, who support of its efforts to stem the the Covid-19 special aid for farmers, handed over food aid to the villagers Covid-19 spread in Sabah. Of the breeders, and fishermen, said in Kampung Salimpodon, said the total, RM3,950,000 was in financial Agriculture and Food Industry upgrading work would start after the aid and channelled to the State Minister Datuk Junz Wong. “We have extended Movement Control Order Disaster Assistance Management received 123,583 names, as of April (MCO) was over. “Although many Committee Fund, said Chief Minister 17. Of the figure, only 118,635 have infrastructure developments have Datuk Seri Shafie Apdal at the State bank accounts,” he said at the State been postponed due to the increasing Assembly Sitting recently. The State Legislative Assembly sitting recently. number of Covid-19, “All we want is Government, he said, would ensure “The State Cabinet has discussed to stop the chain and come back to that the contributions would be used about this and we will arrange for the work without risking our health.” (12 specifically for issues pertaining to cash aid to be handed over directly at April, The Borneo Post) Covid-19 in Sabah. (21 April, The the recipients’ homes and we are in Borneo Post) the process of doing this.” Junz was 63,092 benefit from RM300 special responding to a supplementary one-off aid – CM: A total of 63,092 RM2mil to upkeep Federal question by Paginatan assemblyman people benefited from the special buildings: Sabah received an Datuk Abidin Madingkir. (22 April, Covid-19 one-off assistance payment additional allocation of RM2 million Daily Express) of RM300. In a statement issued by for the maintenance of Federal the Chief Minister, Datuk Seri buildings, said Sabah Federal RM800K water tanks in Inanam Panglima Mohd Shafie Apdal said it Secretary Datuk Samsuni Mohd Nor. after MCO: The State Government involved payment of RM18,927,600. The allocation from the Prime will build four water storage tanks – At the same time, 1,818 students in Minister’s Department brings benefit two each in Kg Kionsom and Kg West Malaysia benefited from the to the G1 and G2 class contractors, he Kokol in Inanam – to resolve the food assistance rendered by the State said, adding the allocation distribution water woes in two villages involving government. The amount involved is process will be implemented some 4,000 villagers. State RM874,100 and is distributed to the according to the guidelines set by the Infrastructure Development Minister students through the Sabah -Kuala Finance Ministry. “It is part of Datuk Peter Anthony said the tanks Lumpur Liaison Office. The State initiatives to ensure the country’s costing RM800,000 in all would be government also provided an economy continue moving and the constructed soon as the Movement assistance of RM500,000 to Universiti maintenance works can be completed Control Order (MCO) ends. He said Malaysia Sabah (UMS). (8 April, The before the end of this year,” he told the villagers do not face any problem Borneo Post) reporters during monitoring the during rainy season but during dry disinfection works carried out at the spell, water resources like water Sabah will focus on main Sabah Federal Government gravity would dry up. “Capacities of productive sectors to speed up Administration Complex their present water storage tanks could economic development: Sabah will (KPKPS). (25 April, Daily Express)

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SELECTED FACTS AND FIGURES FAKTA MUTAKHIR

Malaysia’s Monthly Rubber Statistics, February 2020

(Source: 15 April, Department of Statistics Malaysia)

Malaysia’s Index of Industrial Production, February 2020

(Source: 13 April, Department of Statistics Malaysia)

Malaysia’s Producer Price Index, March 2020

Table 1: Producer Price Index (2010=100) Local Production by Sector (MSIC 2008), Malaysia:

(Source: 30 April, Department of Statistics Malaysia)

1 – 30 April 2020 MONTHLY NEWS SCAN (Tinjauan Berita Bulanan) 4 Malaysia’s Sales Value of Wholesale & Retail Trade, February 2020

(Source: 22 April, Department of Statistics Malaysia)

Malaysia’s Consumer Price Index, March 2020

Chart 1: Percentage Change of Consumer Price Index by Main Group:

(Source: 22 April, Department of Statistics Malaysia)

1 – 30 April 2020 MONTHLY NEWS SCAN (Tinjauan Berita Bulanan) 5