Malaysian economy could shrink more than earlier forecasts, says finance minister

KUALA LUMPUR: Malaysia’s economy in 2020 could shrink more than initially forecast due to extended curbs on movement imposed to stem an outbreak of the new coronavirus, the finance minister said on Saturday (May 2).

Malaysia’s central bank had forecast in April for growth in gross domestic product (GDP) of between -2 per cent and 0.5 per cent this year.

“But that forecast was made after just two weeks of movement curbs. We’re now more than five weeks in … so our GDP could shrink even more,” Finance Minister Tengku Zafrul Tengku Abdul Aziz said in an interview with a local television channel.

Malaysia, which has announced a stimulus package worth 250 billion ringgit (US$5.8 billion) to help cushion the economic blow from the outbreak, will also announce an economic recovery plan later this month, the minister said.

READ: Malaysia reports 105 new COVID-19 cases, authorities warn movement control order still in force

Malaysian authorities on Saturday defended plans to ease coronavirus lockdown measures next week even as the number of new infections jumped to a two-week high.

Most businesses will reopen on Monday, although schools, cinemas and nightclubs will remain closed, along with the country’s borders. Mass gatherings will still be banned.

Security minister Ismail Sabri said Malaysia was not being hasty in relaxing the curbs, stressing that businesses reopening will have to implement hygiene and social distancing measures.

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