The areas will assist the govt to present a strong front to the nation and worldwide, the economic think tank says
by HARIZAH KAMEL & SYAHMIE FAYYADH JAAFAR / pic by TMR FILE
THE Socio-Economic Research Centre (SERC) has proposed 15 focus areas for Budget 2022 to facilitate the nation’s economic recovery.
The economic think tank believed that as the nation enters the endemic phase of Covid-19 and begins to reopen many of its facilities and services, the government should focus on 15 key areas to present a strong front to the nation and the rest of the world.
SERC ED Lee Heng Gui said this upcoming budget would have to be very focused in terms of the trust, strategy and whether it is short-, medium- or long-term.
“It has to revolve around supporting the economic recovery and enhancing economic resilience against future shocks,” he said.
The 15 areas include targeted fiscal stimulus; fiscal revenue enhancement; fiscal expenditure rationalisation and optimisation; green stimulus spending; encouraging consumption; reviving private investments; alleviating business pain points; tax treatment; fortifying the digital economy and automation; increasing exports; rebuilding tourism for the future; going green and sustainable economy; generating jobs and retraining; and solving the lack of foreign workers.
SERC mentioned that the third quarter of the year holds the key to the nation’s economic revival as it slowly reopens more sectors including interstate travels and opening up international borders, among others.
Yet, to fully recover Malaysia’s commercial and living conditions, pandemic mitigation and surveillance must be maintained.
The economy’s direction will be determined by the fourth quarter of this year, it added.
If relaxations of restrictions happen as expected, the nation will be well on its way to recovery by next year.
However, there are several threats to the nation’s economic progress, including volatile financial markets, price pressures, reduced savings, weak domestic demand and political events that could erode public confidence.
Following the three basic principles of rebuilding public confidence and trust; rebuilding and sustaining the economic recovery and investing in the future, SERC believed that Budget 2022 must consider these threats.
These include reskilling and upskilling workers, as well as accelerating digitisation and automation.
“There are jobs which are likely to be permanently lost, but there are new skill sets that are required for companies to adopt more digital transformation in their business model.
“So, this will require a lot of support from the government in the coming budget as well as from companies and organisations on how to upskill and reskill their manpower,” Lee said.
Lee also suggested the government focus on long-term infrastructure building rather than broad-based fiscal expansionary spending to achieve inclusive growth and a sustainable long-term recovery.