GEORGE TOWN: Penang has outlined four distinct strategies to minimise the damage caused to the economy by the Covid-19 pandemic.
Datuk Seri Lee Kah Choon, who is special investment advisor to the Penang Chief Minister, said the strategies are: helping investors catch up on the progress of their projects; SMEs – race to recovery; preparing to help potential job seekers; and strategies for industry development.
Lee said the Movement Restriction Order (MCO), which was enforced on March 18, had curtailed economic activities severely.
He said Malaysians need more than “stimulus packages" as they are merely short-term measures to ease the cash flow crunch of businesses and provide wage support to protect jobs.
He added that the longer-term challenge is to put the country back to work soonest possible by getting it into productive mode, which is the key to financial and social sustainability.
"Looking at the economy as a whole, the demand disruptions are here to stay and the ripple effect will be far, wide and deep. Public sector spending and the manufacturing sector will be the economic drivers to sustain us through the difficult times ahead.
"While the global export market will be dampened by weaker demand, the economic implications are varied across countries. Those that react swiftly to Covid-19 situations, and put in place comprehensive EHS (Environment, Health & Safety) protocols to get their manufacturing sectors back to work quickly, will be the ones that can contain the damage to their economies.
"So, in Penang's case, with half a century of industrialisation in its DNA, the state has navigated numerous up and down cycles and emerged stronger from each. While the Covid-19 situation is unprecedented in its scale, Penang is versatile enough to navigate these uncertainties and seek out fresh opportunities.
"Being a state that drives 30 per cent of the nation’s export and contributes 77 per cent of trade surplus, and being a regional manufacturing hub for medical devices and Electrical and Electronics (E&E) components and finished products, Penang takes a major role in driving Malaysia’s industrial outlook," he said.
Lee said last year had been a fantastic year for Penang in foreign direct investments and most of the strategic projects are being planned and waiting for the MCO to be lifted so that physical implementation on the ground can proceed.
He said the state government will facilitate in every possible manner ways for investments to catch up on their implementation timeline.
"Under the leadership of our Chief Minister, the Penang Development Corporation and InvestPenang are in close contact with investors to drive their plans and projects," he added.
The survival of Small and Medium-sized Enterprises (SMEs), he noted, is crucial for employment and preserving the manufacturing supply chain.
He added that the federal and state governments have already introduced direct financial assistance to SMEs in the form of wage subsidies, deferment of loan repayments and provision of interest-free loans.
"This assistance will temporarily relieve SMEs’ cash flow constraints.
"The conditional operation approval by the International Trade and Industry Ministry (Miti) for qualified SMEs during the MCO period is expected to reduce the financial distress of the SMEs," he said.
Lee pointed out that the current macro environment encompasses too many uncertainties.
"While the current job market in Penang remains stable, we should prepare ourselves for the worst. The state government, via the Penang Career Assistance and Talent Centre (CAT Centre), is ready to offer job-matching facilitation for those who are facing retrenchment due to the shifting of technology.
"The new industries in Penang are doing well and always hungry for talent.
“With the implementation of all investments already in the pipeline, Penang is looking forward to creating at least 13,000 new job opportunities.
"The challenge for us is to match the right skills with new employment opportunities. In the new norm after Covid-19, there is no lifelong employment, only lifelong employability," he said.
To strengthen Penang’s industrial base and protect employment opportunities, Lee stressed that the state has been diversifying industries in various forms over the years.
He added that the Covid-19 pandemic created a new normal for how people live and work. The changes include the higher adoption rate of e-commerce and broader acceptance of work-from-home models by employers.
Penang, he said, understands the importance of digital infrastructure to support the new norm in how businesses are to be conducted.
He said the setting up of Digital Penang to enhance the state’s digital infrastructure will further strengthen Penang as the destination of choice for the digital economy.
"Sustainability is always the top priority of the Penang government. Extraordinary times call for extraordinary solutions and self-adjustments. Amid the prevailing headwinds, we must be ready to adapt and embrace new living, working and learning models.
"The state government is committed to ensuring that Penang remains a conducive, desirable and sustainable destination for 'work, live, play and invest'," he affirmed.