COVID-19: Challenges and Way forward

By H.E. Dato’ Kennedy JawanAmbassador of Malaysia to Japan

5 November 2020

ASEAN-Japan Center – Embassy of MalaysiaASEAN Ambassador’s Lecture Series

Outline

I. Covid-19 situation in Malaysia

II. Malaysia’s Approaches in Combatting the pandemic

III. Impact of COVID-19 on Malaysia’s economy

IV. Economic measures

V. International Collaborations

VI. Malaysia – Japan relations

VII. Way Forward

VIII.Conclusion

1st case : 24 January 2020

Movement Control Order (MCO) : 18 March 2020 (6 Phases)

Currently in Recovery Phase until 31 December 2020 (RMCO)

Covid-19 Situation in Malaysia

35,425 confirmed cases

(+1,032)

271 deaths (4 November 2020)

Testing capacity:

54,706 daily tests

(October 2020)

APPROACHES

Ministerial COVID-19

Task Force

Screening, Investigation and Contact

Tracing

MySejahtera -COVID-19

Contact Tracing App

Increased laboratory

capacity for COVID-19 testing

Quarantine centers, health

clinics & hospitals

Volunteers for Medics

Border control measures

1.

2.

3.

4.

5.

6.

Malaysia’s Approaches

Impact of COVID-19 on Malaysia’s economy

Malaysia’s economy lost an estimated MYR 2.4 billion daily duringthe initial stages of MCO, a total of MYR63 billion when businessactivities were suspended at the time.

As of 1st May 2020, 67.8% of the total 4,094Malaysian companies responded no sales/revenueduring the MCO period

Decline in Production and trade activities

Decline in Consumption

and investment activity

Decline in private

consumption

Tourism(Cancellation of “Visit Malaysia

Year (VMY) 2020)Rise in

unemployment rates (4.7%, August 2020)

January-September 2020:Total trade between Malaysia and Japan decreased by 7.6% (in Ringgit terms)to RM88.9 billion (USD21.0 billion) when compared to the correspondingperiod of 2019 Growth in

online sales

Economic Measures

PRIHATIN Economic Stimulus Package

• Special Prihatin Grant (GKP), a Government initiative of providing an MYR3,000 worth one-off financial grant to support the micro-SMEs in terms of cash flow during the pandemic

• Micro-credit scheme

• Reduction in foreign employees' levy payments

• Wage subsidy programme

• Discount on electricity tariffs

• Commercial Banks : introduced support packages (emergency loans) to support the SMEs, as well as flexibility for repayments ofexisting loans in addition to a decrease in the Policy rate

• 6 months moratorium on the repayment of personal loans and financing

• Additional funding to assist SMEs in sustaining business operations

Malaysia’s economy is on track towards recovery as domestic economic activities improve and exports increase.

The Government of Malaysia had put in place the PRIHATIN and PENJANA initiatives to jump-start the country’s economy

Prihatin (Care) Penjana (Generate)

Economic Measures

National Economic Recovery Plan – PENJANA (Pelan Jana Semula Ekonomi Negara)

• PENJANA has 40 initiatives worth MYR35 billion (USD8.3 billion)

• Investment fund to support the digitalization of Malaysian businesses by channeling funding from international investors into thelocal venture capital space

• Allocation to the Malaysian Investment Development Authority (MIDA) for promotional and marketing activities.

• Tax incentives for the Tourism sector, such as Tourism tax exemption, Income tax relief

• Incentives for the Property Sector to stimulate the property market and provide financial relief to home buyers.

• 100% sales tax exemption on locally-assembled passenger cars and 50% on fully-imported passenger car

-Government of Malaysia’s move to jump-start the country’s economy-

Economic Measures

INVESTMENT INCENTIVES FOR COMPANIES RELOCATING TO MALAYSIA:

• 0% tax rate for 10 years for new investment in manufacturing sectors with capital investment between RM300 - RM500 million.

• 0% tax rate for 15 years for new investment in manufacturing sectors with capital investment above RM500 million.

• 2-day approval of Manufacturing License for non-sensitive industries;

• The establishment of Project Acceleration and Coordination Unit (PACU) in MIDA to speed up the implementation of investment projects in Malaysia.

International collaborations

(i) Sharing of information andexchange of ideas on countries’ experiencesand issues in managing COVID-19 which hasbeen declared as pandemic by WHO on 11March 2020.

(ii) WHO has also announced a largeglobal trial called Solidarity and choseMalaysia as one of the countries toparticipate in a joint research to test anantiviral drug, Remdesivir as a possiblemedicine to treat COVID-19 patients.

International collaborations

JAPAN – ASEAN

• Special ASEAN and ASEAN Plus Three Summit on Coronavirus Disease 2019 (COVID-19),

• ASEAN Centre for Public Health Emergencies and Emerging Diseases

International collaborations

2020 Theme:

Optimizing Human PotentialTowards A Resilient Future ofShared Prosperity

Malaysia – Japan relationsDiplomatic relations 外交関係

• Established on 31 August 1957• Establishment of the Embassy of Japan in Kuala Lumpur in September 1957 and the

Embassy of Malaysia in Tokyo in January 1958.

Political 政治的関係• High level exchanges: Visit by His Majesty King of Malaysia (2019), Visit by then PM of Malaysia to Kyoto

and Fukuoka (2019)• Cooperation in areas such as trade, investment, industrial development, human resource development,

capacity building, tourism, education, ICT, cultural exchanges, science and technology.• Malaysia and Japan - “Strategic Partnership”.

Look East Policy (LEP) ルック・イースト政策• Initiated by the 4th PM Tun Dr Mahathir Mohamad in 1982• Cornerstone of Malaysia-Japan bilateral relations• Training and education programmes, trade and investment, education, human resource development and

transfer of technology

Malaysia – Japan relations

Economic relations 経済関係(in 2019)

• Japan was Malaysia’s 4th largest trading partner in 2019.• Japan was Malaysia’s 5th largest export destination and 4th largest source of imports• Malaysia was Japan’s 13th largest trading partner , 13th largest export destination and 12th largest source of

imports• January – September 2020: Total trade between Malaysia and Japan = USD21.0 billion (drop by 7.6%)

• As at December 2019, 2,712 Japanese manufacturing projectswere implemented in Malaysia worth USD27.3 billion.

• Japan is the largest foreign investor in terms of implementedprojects in Malaysia

• Japanese companies in Malaysia:• Panasonic, Nippon Electric Glass,

Toray, Sony, Rohm-Wako andHonda.

In the manufacturing sector, Malaysia ranked 4th among 17 economies on competitiveness as a manufacturing hub (Study by KPMG)

Malaysia – Japan relations

COOPERATION IN ADDRESSING THE COVID-19 PANDEMIC

• Assistance by the Japanese government via UNICEF, UNHCR and

IFRC

• Provision of Avigan (influenza medication) for clinical research

through UNOPS

• Supply of medical devices and modalities to Malaysia

RECENT HIGH-LEVEL EXCHANGES

• Telephone call between FM Motegi Toshimitsu & FM Dato Seri

Hishammuddin Tun Hussien (19 May 2020)

• FM Motegi’s visit to Malaysia (14 August 2020)

RESIDENCE TRACK

• Residence Track: Entry of Malaysians and Japanese nationals into

Japan and Malaysia

Way forward

• Changed the way diplomacy, trade & investment activities are conducted

• Virtual, creative means of communication and conduct

• Online business environment, teleworkingNew normal

• Development of SOP and response plans for present and future outbreaks.

• Development of a vaccine/antidote for COVID-19

• Growth of digital sectors: Telework and video conference platforms, e-commerce, food delivery, gaming, delivery, e-sport and edu-tech

Opportunities

New normal for export activities’ promotion [Malaysia – Japan]

• virtual exhibitions,

• virtual B2B Meetings,

• dissemination of trade information via My Export,

• Webinars

• trade clinics and virtual trade advisory for the Japanese business community and Malaysian companies

that are keen to venture into the business scene in Japan.

Conclusion

• Development of vaccine

• Adherence to safety measures

• Relaxation of restrictions, border control measures

• Resumption of travel in stages

• Tokyo 2021 Olympics

• Home to many remarkable treasures and hidden gems.

• A melting pot of culture - Malaysia –Truly Asia

• Malaysia – Tourism, education, business and investment destination