KUALA LUMPUR: THE short-term Economic Recovery Plan (Penjana) is well covered and will impact various groups and individuals for the short- and medium-term, economists said.
Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the plan addressed concerns of the labour market, the transition into a new normal, especially in respect to digitalisation and the mainstream economy, such as the property and automotive industries.
"It shows that the government is committed to promoting growth as it is willing to tolerate higher (fiscal) deficit.
"Should the reopening of the economy continue to do well, we can expect better growth in the second half of 2020," he told the New Straits Times yesterday.
Afzanizam said banks, in particular, should welcome digitalisation measures and the gig economy.
He said the matching grant of RM50 million would encourage gig economy workers to contribute to the Social Security Organisation and Employees Provident Fund.
"This means their social safety net is being taken care of," he added.
He said Malaysians would be more willing to spend online due to the Penjana incentives.
These include a free RM50 e-wallet credit, promotional codes and discount vouchers.
On another matter, he said, matching grants for small- and medium-scale enterprises to aid them with their transition to digitalisation via training and subsidies would encourage them to leverage on the digital platform.
"The reintroduction of House Ownership Campaign and sales tax exemption for automotive completely-knocked down products should help propel the properties and the automotive sector."
Putra Business School Associate Professor Dr Ahmed Razman Abdul Latif said the RM10 billion direct fiscal injection, would help individuals, such as the 2.4 million workers who are receiving wages subsidy, jobless individuals and local businesses through digitalisation grants, the Buy Malaysian campaign and the free RM50 e-wallet credit.
He said, Penjana also emphasised middle-term effects, such as tax incentives or exemptions as well as various incentives to attract foreign businesses and investors to set up their operations in Malaysia, which could address unemployment.