The implications of the emergency declaration on businesses and investors should be addressed by the government, a think-tank said.
Social and Economic Research Initiative (SERI) said there is a need and opportunity for a concerted effort to provide more clarity on the implications of the emergency in relation to investment and economic activity.
“For example, with the emergency being in effect until Aug 1, how will this impact the current, planned and future investments?” the group said in a statement yesterday.
“We cannot afford to put foreign or domestic economic activities on hold while we address Covid-19. It must be a concurrent coordinated strategy to address both lives and livelihoods, in partnership with the private sector,” the statement added.
On Tuesday, Prime Minister (PM) Tan Sri Muhyiddin Yassin announced that the King, Al-Sultan Abdullah Ri’ayatuddin Al-Mustafa Billah Shah consented to a proclamation of emergency until Aug 1.
In his speech, Muhyiddin said Malaysia is “open for business”.
He also reminded investors that the government has a six-pronged strategy to bolster economic growth.
However, according to SERI, the emergency proclamation potentially allows the government far-reaching ordinances by the consent of the King.
It said this includes commandeering of land and private sector resources by the government in order to manage the spread and treatment of the Covid-19 virus.
Among the concerns raised by the private sector, it said, is how will factories, businesses, data centres and fibre optic cables be taken over should the need arise.
“Will both domestic and foreign-owned resources be exposed to the same risks, or does the government intend to treat domestic and foreign investments differently? Where are the boundaries and limits, and whose interests will be protected?”
“The rapidly increasing flows of investment to neighbouring Vietnam, Thailand and Indonesia serve as worrying reminders that we must do better to achieve our true potential,” the group noted.
It also urged the government to implement measures to support micro, small and medium enterprises, bottom 40% income group households, people with disabilities and others who require financial assistance to stay open and afloat until August 2021.
“Malaysia may be open for business, but there is certainly more we can and should do to increase social and economic resilience,” it stressed.
Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said the Malaysian capital markets will remain open to support and facilitate fundraising, trading and investment, with all regulatory functions in place throughout the various forms of Movement Control Order and the Emergency Ordinance period.
“The continued operations of the capital markets are important to support the resilience and recovery of the economy, and help investors manage their risks and opportunities during this period.
“I would also like to highlight that Malaysia has a resilient capital market ecosystem, supported by ample liquidity,” he said in a statement.