Article Effect of Covid 19 on Malaysia Economy

 

THE EFFECT OF COVID-19 ON ECONOMY AMONG MALAYSIAN

Muhammad Faiz bin Jasmi A169638

Azamuddin bin Khairuddin A165921

Mohamad zhafi fathuddin bin zohiar A164779

Muhammad Faiz bin Nor Azli A169317

Faculty of medicine, Universiti Kebangsaan Malaysia

Abstract

This study is conducted to get the data about the effect of covid-19 on economy among Malaysia. The data that we get is from department of statistics Malaysia. Looking forward on economy status, the data is collected based on chart that shown Malaysia unemployment rate from 2008 to May 2020, and depreciation in Malaysian ringgit against USD. Based on the finding, what we can conclude that covid-19 impact is shown not good phenomenon because it shown number of unemployment among Malaysian is increases in May 2020 and the exchange rate for Malaysia ringgit to USD become weaker based on data that collect from Malaysian exchange rate for March 2019 is RM4.08 for 1 USD compare within July 2020 RM 4.26 for 1 USD.

 

Key word: economy status among Malaysian

 INTRODUCTION

            In early 2020,one shocking virus has been widely spread and become the most problem in all country because how severe the disease itself.It also have been caught by media and headlines worldwide as it have cause many country increase in the cases that can be life threatening.The Covid-19 is a newly discovered strain of coronavirus that will cause respiratory infections in humansThe origins of this disease have been traced in the food market in Wuhan,China in December 2019.The Chinese government has informed the World Health Organization about the increase in cases of pneumonia which means the lung infection.According to National Health Commission of China,it is believed that the patient got infected coronavirus have visited the seafood market which the sold live rabbit and bats.Apart from that,they also believe that the people who consume the bats as the source of the virus to develop.The transmission process occur and the virus spread when people visit China and tourist from China visit other countries make the disease more prone to cause widely spread.

            On January 24 2020,the first case of Covid-19 have been detected and cause a shocking to the Malaysia.The case keep on increasing and most of the cases reported believed that they have travel to the affected countries and regions.This prove that the Covid-19 is very highly transmission in rate.Due to this,Malaysia have make plenty of move to avoid this disease become more severely spread to others citizen.Ministry of Health have announed to make lockdown or MCO towards the country as preventive measures to control the spread of the disease.

From the lockdown,which the methods are prohibition of movement and mass assembly nationwide,including all religious,sports,social and cultural activities.Besides that,all  religious activities in mosques suspended,including Friday prayers,Malaysia barred from leaving the country,and restriction placed on the entry of non-Malaysians into the country.Furthermore,all industries local or federal are closed except for infrastructure services and supermarkets,wet markets,grocery stores and multi-functional selling daily necessitites,all nurseries,government and private school and vocational training closed based on the method of the MCO.Due to the restriction on the entry of all tourist and foreign visitor into the country have give impact towards the economy and financial aspect in the country.The MCO have been implement on 18 March.

Many have suffer from financial problem because the limitation to run their business and this also give economy problem in the country especially in exporting and importing local and foreign products.It also increase unemployment rate in Malaysia.Moreover,the broad based travel restrictions and travel risk aversion have affected all tourism related sectors.Global supply chain disruptions pressured the production and trade activities of the manufacturing sector.The decline in private consumption and investment due to reduced household spending.Heightened financial market votality due to ongoing external uncertaintites may lead to tighter domestic financial market conditions.

Apart from the pandemic, the domestic economy will also be affected and volatile shifts in crude oil prices.This is example the impact in economy sector of Malaysia from Covid-19 due to the preventive measure use by Ministry of Health to control the spread of the disease.

Findings :

 

Figure 1.1 : Data about economic impact due to Covid 19 by Department of statistic Malaysia

          We can see based on a small poster that we got from Department of Statistic Malaysia, based on special survey done by them. First one we could see about the respondent that take part in this survey. There are 168182 respondent and two states with highest number of respondent were Selangor and Johor. Selangor with 27.1% or 45578 person while Johor with 20.3% or 34141. It is logically why both states have a large number of respondent because both states were industrial states and most economic sector were at both states. Behalf on gender we can see female have more participate in this survey than man. Below the respondent data is employment status data. As we can see civil servant are not included in this data as well since civil workers not involving in  economic sector. The most affected sector were Private employee, unemployed and own account worker. Private majorly affected due to reduction of consumer because of implementation of MCO. It caused their financial unstable and causing them to reduce their workers. Workers that had relinquished now be unemployed and this contributed to increasing percentage on unemployed workers. Beside own account workers also affected when MCO implemented because their consumer cannot directly buy items to them causing their financial not stable.

     The data or graph provided at savings readiness is about the most affected sector during this pandemic and the duration how long they can survive with their savings. As we can see the yellow colour refer to employer or private employer which highly affected while own account worker represent purple colour. If we relate the most important factor with duration they can possibly survive during this outbreaks, we can conclude that they are not financially ready if total lockdown implemented by government. For employer and private employer, they possibly can survive with their current savings only two months and as MCO still implemented till nowadays, we assume that they struggle to buy their needs today. Private sector todays facing a big challenge in maintaining their economic status back to normal because there are a lot of restriction not just in Malaysia but also other country. As an example,if the private sector involve in manufacturing sector, it will face big trouble to import or export their items to buy or to sell it to other country.  For own account workers, even though the percentage is low, which 6.2% only affected, but 71.4% of them only able to stand 1 month only with the savings their have. We can state that their will suffer longer to compared with other groups.

    On employment part, is the data about workers that lose job by main sector and impact on own account worker. As we can see the agriculture sector are the most impacted with 21.9%. Especially for fisherman because they have to go to the ocean every day to catch fish or mineral sources to be sell. But when the MCO implemented they cannot go to the sea, causing them lose their main source of income. As we can see 33% from agriculture sector come from fisheries. It cause them suffer, and relate with statement we mentioned before, they will suffer longer because their savings decrease day by day. Services sector, especially food and beverages also heavily impacted because they have to shut down their premise when MCO implemented. But luckily they were delivery services such as Food Panda so they still can open their premise without dine in customers. Beside industrial sector, especially construction also affected by the outbreaks. It is because we also use foreign workers also and when MCO implemented, government restricted foreign immigrants entering this country. This causes their current projected progression slowed. Own account worker also affected when this pandemic occur. As we can see 46.6% of them lose their job and the remaining that still working have to decrease their income because company have to cut the cost. This show that even though own account worker least affected but they are also struggle and suffer as well as others.

  Below are the spending pattern difference before and during the outbreaks. Majority of respondent choose not to eat at the restaurant and go to cinema when the outbreaks happen. Most of them, even though before outbreaks they use to having time at cinema, but during the pandemic, most of them never go to cinema like usual.  The pattern of going to supermarket or groceries to buy raw material for cooking are also decrease since the MCO started. We suggest most of them will buy the things online and delivered straight to their house to avoid them affected by coronavirus.

DISCUSSION

            The data suggests that two states with highest respondant are Selangor amd Johor by 27.1% and 20.3% respectively from 164182 respondents. As what we know, both states record the highest number of Covid-19 in a country in Malaysia. The data supported by image taken from (TheStar) in Figure 1.0.

This image in Figure 1.0 is the total numbers of Covid-19 cases for each country in Malaysia until May 20, 2021. We can see that Selangor, Wilayah Persekutuan Kuala Lumpur and Johor that recorded with highest number of Covid-19 cases. In fact, Kuala Lumpur is the capital city of Malaysia that locate many Ministry office, parliament, offices, and another infrastructure. But, most of this cases came from manufacturing sector which has many infected in Selangor and Johor.

             

 

 

 

 

The next findings that stated in the image is Unemployed and Private employee recorded with  21.0%  and 21.5% each above another employment status. Economy pattern of Malaysia is decrease gradually due to the Covid-19 pandemic that heavily affected on Malaysian. This is plotted on graph in Figure 1.1. 

Low revenue company with high employee in the country could make people lose their job and had financial problem especially for the manufacturing sector and food & beverages. In Figure 1.1, GDP growth of Malaysia in 2017 is 6% then decreasing to 4%. Due to impact of Covid-19, it decrease to 3%. It results from the movement restrictions that applied to all and affect to the low economy growth. From the issue like people lose job and suffer in financial problem, the economic growth will become slower and it could affect on the Malaysia currency (MYR). Between October and December last year, much of the country came under renewed restrictions, including travel curbs, as the government scrambled to deal with a third wave of Covid-19 infections.  Stated on finding that three sectors heavily affected, by this pandemic are agriculture (21.9%), services (15.0%) and industry (6.7%). This show the main factor of Malaysia’s economic growth is difficult to improve due to lose job and low revenue or profit.  

 

 

The spending pattern of people is changes significantly before and during Covid-19. People tend to option not to eat out or take away food from restaurant and not go to cinema.  Plus, activities of buying groceries and rawr materials for cooking at supermarket has reduced. It can cut cost for people to spend on transport and item People rather to stay at home that go outside to buy stuffs. So, clearly Covid-19 pandemic changing the spending pattern of Malaysian. 

Conclusion

A novel coronavirus, named SARS-CoV-2, has caused major outbreaks of COVID-19 disease with severe effects worldwide when compared to the previous two deadly pneumonia diseases, SARS and MERS. More than 1.5 million positive cases of SARS-CoV-2 infection had been recorded globally 4 months after it was first discovered in China. Malaysia was ranked 34th in the world based on the number of positive cases.

 Perceiving the alarming trend shown in other countries, constructive actions and effective measures to overcome this pandemic became the main agenda of the Malaysian government in the early stage of its emergence in the country. Specific hospitals were assigned to handle COVID-19 cases as a measure to isolate the patients and prevent them from affecting others. The capacity and capability of laboratories were enhanced to speed up sample testing and the provision of results.

An MCO was enforced as the biggest decision by the government to strictly and seriously break the chain of COVID-19 within the community. This tough decision has obviously affected all sectors, especially the economy, from the smallest scope of individual income to the largest of international trade. However, all Malaysians showed their full support of the MCO enforcement to ease the burden of frontliners, especially medical personnel, in handling the increasing numbers of cases each day.

To lessen the effects of the MCO, the Malaysian government has granted a huge budget to various sectors to lessen the effect of this pandemic, initiate people-based economic growth, and encourage quality investments. The PRIHATIN Package has been one of the beneficial initiatives announced by the government, followed by drastic measures of a 6-month moratorium offered by BNM to reduce the financial impact. In addition to these collective measures, all Malaysians have played their role through different channels to help the nation in facing this major outbreak. Each individual is playing a big role in ensuring the community and country become free from COVID-19.

Reference

 

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