KUALA LUMPUR: Malaysia's inconsistent lockdown measures in the fight against the Covid-19 pandemic has hampered the country's economic growth as other Asean countries see a positive rebound.
Former second finance minister Datuk Seri Johari Abdul Ghani said small- and medium-sized enterprises (SMEs) lost business capital due to the flip-flop measures.
He said SMEs made up 98 per cent of companies in Malaysia and contribute to almost half of the country's total employment.
"By contrast, other Asean countries implemented lockdowns seriously. Once they reopened their economies, they did not revert back to lockdowns.
"The other Asean countries used to be lagging behind us. Now, they are ahead of us. Indonesia and Vietnam, for example, managed to draw more foreign direct investments (FDI) in 2020 and 2021."
He said Malaysia's gross domestic product (GDP) growth rate in 2020 was -5.65 per cent, but in 2021, a growth rate of 3.13 per cent was recorded.
"But our net growth rate was still negative," he said during the 2023 Budget discussion with TV3 today.
Johari said most investors wanting to embark on new ventures or expand their existing ventures in Malaysia were holding off their plans due to concerns over the country's political stability.
In the long run, Johari called on the government to identify and develop potential SMEs that can reduce the country's reliance on imports to take the economy forward.
He said the government should focus on projects that have "multiplier effects" for domestic activities so that additional allocations can be channelled to roll out subsidies for consumers.
Meanwhile, PKR deputy president Rafizi Ramli, who also joined the session, said the government should focus on improving the disposable income of households to benefit the people.
"We need more holistic measures to determine economic growth instead of relying on conventional yardsticks, like the GDP.
"Indeed, our ringgit is faring better than Thailand's baht (against the US dollar). However, the currency decline in Thailand has not affected people's livelihoods, as the ringgit's decline has in Malaysia.
"Thailand has lower dependency on food imports and most of the employment in the country is not dependent on foreign investments."
Rafizi said the country should focus on attracting FDI that can create jobs that match domestic requirements.