The Malaysian Investment Banking Association says the Pakatan Harapan Government presented its fair share of challenges while trying to achieve fiscal prudence without derailing the economy and hurting the wellbeing of the Rakyat in 2019 Budget.
“It shows the strong commitment to ensure the economy continues to expand at a healthy pace while at the same time taking into consideration on the wellbeing of the people,’ says its chairman Tan Sri Azman Hashim.
“We appreciate the Government’s efforts to ensure the 2019 Budget will be inclusive, responsible and comprehensive towards achieving sustainable economic growth by taking into consideration of the interests of all groups in the country as the citizens of Malaysia. At the same time, it cares for the interests of the rakyat reflected by the targeted incentives and measures and create more high impact programmes.”
Azman points out that the Government’s plan to reintroduce the Malaysia Incorporated Policy by streamlining and improving the administrative rules and regulations, establish a new version of the public private partnership (PPP) where land swap approach will be revised, open tender, widening the export markets, encourage green FDI investments.
“This policy is seen to have a new mindset where the public sector will focus on value add contribution to the commercial and economic values and serve as a constructive facilitator by providing a more enabling policy environment which includes investing in human capital formation and education, raising the quality of public delivery services, timely dissemination of information, market liberalisation and strengthening institutions while the private sector will need to discard the “business as usual” mindset.”
To further strengthen the role of the Small and medium enterprises’ (SMEs), several measures were introduced such as RM4.5 billion SME Loan Fund, 1% reduction in corporate income tax rate for taxable income of up to RM500,000 and SMEs with less than RM2.5 million paid-up capital, from 18% to 17%, RM100 million to upgrade capability of SMEs in the halal industry via various programmes to increase exports and make Malaysia a global halal hub by 2020, RM1 billion SME Syariah Compliant Financing Scheme to be made available via Islamic financial institutions where government will provide a 2% profit rate subsidy.
“We also welcome the government’s move to raise productivity by encouraging more SMEs to adopt new technologies in digital platform like e-commerce, mobile-commerce and social-commerce platforms through Industry 4.0 as it will improve their revenue, open new markets, improve customer service support and experience, and provide a more efficient end-to-end customer journey.”
The 2019 Budget also focus on empowering human capital which is a critical factor for the future of the nation. Towards this, emphasis is to intensify higher education and strengthen the technical and vocational education. These efforts will help improve the overall efficiency as well as flexibility of the labour market.