Coronavirus: Malaysia unveils US$4.8 billion stimulus package to cushion outbreak impact
- The economic measures include tax breaks for tourism businesses and funds to ease cash flow for industries affected by the epidemic
- Interim Prime Minister Mahathir said the government now expects the economy to grow 3.2%-4.2% this year, down from an earlier forecast of 4.8%
The fallout from the virus is wreaking havoc on mobility and supply chains across Asia, including Malaysia.
Mahathir said the government now expects the economy to grow 3.2%-4.2% this year, down from an earlier forecast of 4.8%, and was widening its fiscal deficit target to 3.4% of gross domestic product from 3.2%, which already had been raised from an initial target of 3%.
“I believe the economic stimulus package will enable the Malaysian economy to achieve the highest point of the range” of the GDP forecast, he said. “In formulating the stimulus package, the government exercised prudence with respect to its fiscal position.”
“Lowering the growth target is sensible given the downside risk to growth regionally and globally,” said Winson Phoon, head of fixed-income research at Maybank Kim Eng Securities Ltd. in Singapore. “The modest widening of the fiscal deficit from 3.2% to 3.4% is tolerable from a rating point of view.”
