Malaysia Extends Covid-19 Lockdown

The nationwide Covid-19 lockdown which started from 1 June 2021 and was supposed to end on 28 June 2021 has been extended indefinitely due to persistently high daily new infections. On 29 June 2021, daily new infections returned to a level of more than 6,000 after staying below 4,000 for two days and hovering between 5,000 and 6,000 for six days. In consultation with your economics tutor Singapore in economics tuition Singapore, discuss the key considerations to lift the lockdown. One of the key criteria for the Malaysia government to lift the nationwide lockdown is to bring down the daily new infections to below 4,000. As of 1 July 2021, Malaysia has reported close to 752,000 cases and over 5,000 deaths.

RM150 Billion Aid Package

On 28 June 2021, Malaysia’s Prime Minister Muhyiddin Yassin announced a new aid package of RM150 billion. The new aid package includes an RM10 billion cash aid, in the forms wage subsidies and unemployment assistance to help households and businesses affected by the nationwide lockdown. A sum of RM4.6 billion will be given as cash handouts to benefit 11 million people, mainly the elderly and singles in low- and middle-income groups. They will receive the cash handouts ranging from RM100 to RM1,300 in August 2021. The disabled will receive a higher cash handout of RM1,500. They can also apply for seed funding to start a business. A total of RM20 million has been allocated for this cause to aid the disabled and homeless in starting their own businesses. You may discuss with your economics tutor Singapore in your economics tuition Singapore class the efficacy of this RM20 million seek funding. There is also an RM500 million aid to the one million people who have lost their jobs due to the Covid-19 pandemic.

Apart from the cash aid, the government has also announced wage subsidies of RM3.8 billion, together with other measures such as tax breaks and grants to help local people and businesses tide over this difficult period. In addition, a six-month bank loan moratorium will be offered to all individual borrowers. To find out more about the benefits of a bank loan moratorium, you may sign up for economics tuition Singapore with a reputable economics tutor Singapore. Mr Edmund Quek is widely regarded as the best economics tutor Singapore with over 20 years’ experience in teaching economics tuition Singapore. Please visit the economics tutor Singapore’s website at to learn more about this economics tutor Singapore and his economics tuition Singapore. People will also be allowed to tap on their Employees Provident Fund by withdrawing up to RM5,000. Businesses can expect up to 40 per cent discount on their electricity bills from July to September 2021. Most importantly, an additional RM1 billion will be channeled towards the vaccination programme, including RM400 million for the purchase of vaccines.

Swelling Budget Deficit

Prior to this new RM150 billion aid package, the Malaysia government had given out seven stimulus packages worth a total of RM380 billion since the onset of the Covid-19 pandemic. You may consult your economics tutor Singapore in economics tuition Singapore about the previous seven stimulus packages. The government had been trying to avoid another stimulus package due to its swelling budget deficit. In 2020, Malaysia’s fiscal deficit enlarged to 6 per cent of its GDP, the largest in over a decade. In contrast, the public revenue fell drastically as a result of the many disruptions caused by Covid-19 pandemic. Therefore, same as the many households and businesses in Malaysia, the government has also been struggling to make its ends meet. With guidance from your economics tutor Singapore in your economics tuition Singapore class, discuss the possible ways for the Malaysia government to fund its swelling budget deficit.

Experts believe the new RM150 billion aid package is a decision under pressure due to the mounting public anger and criticism. It remains to be seen how the government will fund the increasing government spending should the Covid-19 pandemic stay for another year.

Linda Geng

Click to Read Next Post

economics tuition, back to homepage

Economics Tuition Singapore @ Economics Cafe
Principal Economics Tutor: Mr. Edmund Quek