Malaysian Prime Minister Muhyiddin Yassin has unveiled a RM35 billion (US$8.2 billion) stimulus package to help the nation’s economy recover from the impact of COVID-19 and the subsequent MCO lockdown measures, which saw the majority of businesses shut down for weeks under restrictions on public activities.
Out of the RM35 billion, up to RM10 billion will be used as direct fiscal injections.
Billed as a short-term economic recovery plan (ERP), the package titled “Pelan Jana Semula Ekonomi Negara” or “Penjana” was established with three main goals: to empower the people, propel businesses and stimulate the economy.
This recovery plan will consist of 40 initiatives, with much emphasis being placed on aiding and supporting SMEs and their workers through training programmes, social support, financinf shcemes, boosting domestic consumption, and supporting industries impacted by the MCO and pandemic. Throughout this entire ordeal, it is the SMEs who have struggled the most to survive.
Penjana is the government’s latest initiative to mitigate the impact of the virus and its lockdown measures.
Putrajaya previously allocated RM260 billion through the Prihatin Rakyat stimulus package which included bank loan moratoriums, cash aid and loans for businesses.
With regards to SMEs, Muhyiddin said the government would be allocating up to RM50 million in matching grants for companies in the gig economy to make Socso and EPF contributions for their workers.
In addition to this, the government would also be setting up a special committee chaired by the ministers of finance and human resources comprising leaders from both public and private sectors in order to keep track of all initiatives related to workers.
“In line with the government’s call to encourage SMEs to implement work-from-home practices, insurance coverage and tax incentives will be provided,” he added.
“For example, tax exemptions of up to RM5,000 for workers who get a tablet, computer or smartphone from their employers.”
RM70 million will also be allocated for matching grants, and a further RM700 million to help SMEs digitalise their operations.
RM1 billion will be allocated to support SMEs in the tourism sector, while RM400 million will be allocated for the support of microbusinesses; with an additional RM500 million being allocated for loans to Bumiputera entrepreneurs.
Tax incentives would be extended for companies purchasing equipment such as PPE and thermometers.
Plans are also in place to offer tax rebates of up to RM20,000 for three years for SMEs set up between 1 July and 31 December this year.