DAP regrets the stubborn refusal by the Prime Minister Tan Sri Muhyiddin Yassin to heed the calls of ordinary Malaysians and the business community to extend the moratorium of bank loans by another 6 months, when it expires on 30 September. Master Builders Association Malaysia (MBAM) is the latest to plead for an extension, following losses for the construction industry of RM11.6 billion every month since the nationwide Movement Control Order (MCO) began on March 18.
Of these, 29% of the losses were due to the unemployment of industry workers as construction projects had to be halted. What is significant is that MBAM’s plea for the extension of the moratorium for another half a year is defensive and a cry for help, to help protect not promote one of the most important economic sectors in the country.
The value of the loan repayment moratorium by financial institutions since April 1 is estimated at RM85.8 billion, of which RM30 billion had benefited the business sector while RM 55.8 billion involved individuals. This is significant in protecting the livelihood, jobs and businesses of 8 million individuals and companies.
Whilst the banking industry will incur losses of RM6.4 billion for another 6 month extension, this can be easily borne by the banking industry that recorded profits of RM32 billion in 2019. Even if the banks are unwilling to do so, the government can inject the RM6.4 billion to assist 8 million Malaysians and companies. This is money well-spent, with a high impact value to 8 million Malaysian individuals and companies of RM 86 billion.
The Human Resources Ministry has also revealed that there will be 1 million unemployed Malaysians by the end of September, of which more than 500,000 are youths. Failure to extend the loan moratorium will only increase the hardship of 1 million unemployed Malaysian workers.
Since the Federal government refuses to listen, then outside pressure is needed. Perhaps only a Warisan Plus victory in the upcoming Sabah State General Election can compel Tan Sri Muhyiddin to change his mind and extend the moratorium on bank loans by another 6 months.