KUALA LUMPUR: The Institute for Democracy and Economic Affairs (Ideas) has described the National Economic Recovery Plan (Penjana) as timely in addressing the prospect of unprecedented levels of unemployment and slowdown in the country’s economy.
Ideas research manager Lau Zheng Zhou said overall, the key initiatives presented in Penjana were balanced in its coverage of the different target groups and business areas.
“The focus on digital investment for consumer and business adaptations is also forward-leaning.
“While Penjana is understood as a short-term recovery plan that will expire at year-end, some of the initiatives still seem very much an extension to the protection-focused theme from previous stimulus packages,“ he told Bernama.
Lau said hence, Ideas urges the government to ensure adequate long-term thinking in Penjana’s implementation to guide the economy’s exit from the crisis mode more effectively.
He said the extension of the Wage Subsidy Programme by another RM5 billion reflects the government’s ongoing priority to promote employee retention and reduce layoffs.
“However, the low take-up rate raised concerns over the efficiency of approval and disbursement processes,“ he said.
According to the Ministry of Finance, only RM3.22 billion out of the total RM13.8 billion that was previously allocated in the Prihatin Rakyat Economic Stimulus Package (Prihatin) had been approved as of May 31, 2020.
Ideas shares concerns on unemployment and looks forward to an improvement in the bureaucratic processes so that targeted recipients have better access to the wage subsidies.
Lau noted that the allocation to spur digital adaption in the economy was highly commendable and Ideas looks forward to a more comprehensive approach towards optimising the enabling factors for higher digital adoption, in addition to increase digital usage and spending over the short run.
“Structural issues ranging from infrastructure investment, effective regulation and the presence of monopolies must be addressed in concurrence with current recovery spending.
“This is crucial to better lay the foundation for future growth and development,“ he added.
He said Ideas commended the government’s approach in having more regular public communication to report on the status and progress of economic stimulus measures.
“Broader stakeholder engagement is also necessary to ensure greater inclusivity in gathering public feedback on potential challenges and effectiveness of policy implementation,“ he said. — Bernama
