Budget 2022 to accelerate nation’s economic recovery

Political stability will contribute to a more conducive environment for country’s investment sector, capital market and economy, says minister

by NUR HANANI AZMAN / Pic by BERNAMA

THE Finance Ministry (MoF) will continue to accelerate the nation’s economic recovery through Budget 2022 by drafting policies that are both business and investment-friendly, and strengthen resiliency.

Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz (picture) said political stability will contribute to a more conducive environment for the development of the country’s investment sector, capital market and economy.

He believed the signing of the memorandum of understanding (MoU) on Political Transformation and Stability between the federal government and Pakatan Harapan (PH) will have a positive impact on the country’s economic growth in the fourth quarter of 2021 (4Q21) and 2022.

“Overall, the implementation of stimulus packages, the reopening of economic sectors and Malaysia’s diversified economic structure have successfully resulted in the nation’s GDP growth of 16.1% in 2Q21.

“MoF is confident that the MoU signed on Monday will continue to support economic recovery and the GDP growth projection of between 3% and 4% for this year,” he said in a statement yesterday.

The MoU was signed by Prime Minister Datuk Seri Ismail Sabri Yaakob and heads of the PH component parties at the Parliament on Monday.

Budget 2022 will also implement several restructuring aspects that will support the objectives of the 12th Malaysia Plan in driving more sustainable and competitive growth.

Meanwhile, Tengku Zafrul said the government will increase the ceiling cap for the Covid-19 Fund, if necessary, to continue supporting the people and businesses that are in need.

He said on Sept 10, the Cabinet approved a proposal to amend the Temporary Measures for Government Financing (Coronavirus Disease 2019) Act 2020.

“This includes raising the ceiling for the Covid-19 Fund from RM65 billion to RM110 billion and increasing the government’s statutory debt ceiling from 60% to 65% of the GDP.

“The amendment to the bill will be tabled for Dewan Rakyat’s approval next month,” he added.

Among other things, it is aimed at strengthening the public health system, especially to curb the spread of the Covid19 epidemic and to treat Covid-19 patients; improving direct cash assistance to the people; and supporting business continuity, especially for small and medium enterprises (SMEs) and micro SMEs.

On the same note, Tengku Zafrul said the MoF has instructed banking institutions to work towards waiving interest payments for loan moratorium recipients immediately.

“This would involve moratorium recipients from the bottom 50% of Malaysia’s population for three months in 4Q21,” he said.

He said to focus on efforts to combat the pandemic, and the spirit of consensus across parties is expected to bring back hope to the people.

“MoF’s priority is to protect lives from the threat of Covid-19, and ensure that the country’s economic growth prospects remain strong, driven by the National Recovery Plan and the principles of prudent financial management,” he concluded.