STATEMENT
THE SPECIAL SEGMENT ON FINANCING THE COVID-19 RECOVERY
2021 ECOSOC FINANCING FOR DEVELOPMENT
BY
H.E. MUSTAPA MOHAMED
MINISTER IN THE PRIME MINISTER’S DEPARTMENT (ECONOMY)
MALAYSIA
UN HEADQUARTERS, NEW YORK
Ladies and Gentlemen,
Let me first thank ECOSOC for organizing this Forum on “Financing for Development”, and for inviting me to say a few words.
COVID-19 has caused a global recession the likes of which have not been seen for many decades. Malaysia, as a country deeply intertwined with the international economy, has not been spared. The country’s economic growth, income streams, and employment numbers, have been negatively affected by the pandemic.
In the past one year, we have been focused on protecting lives and livelihoods. We have put in place five economic stimulus packages and recovery plans, amounting to 20% of Malaysia’s GDP. The Malaysian Government’s economic response to COVID-19 is probably among the biggest in the world.
Ladies and gentlemen,
We have increased spending on healthcare, and have put in place wage subsidies, cash transfers, loan moratoriums, besides giving direct assistance to micro and small scale businesses. The Government's initiatives have helped cushion the effect of the pandemic on the economy, limiting Malaysia’s GDP contraction to 5.6% in 2020.
It is our hope that the vaccine rollout will gradually reduce the number of cases, and gradually put an end to this global pandemic.
We started our vaccination program a few weeks ago, and are hopeful that we can get at least 80% of our citizens vaccinated by early next year.
That being said, the international community must prepare for the ‘new normal’ post-pandemic. Some changes to everyday life are unlikely to reverse when the pandemic is over. Automation, work-from-home, and the widespread use of technology in everyday life are unlikely to revert to pre-pandemic norms. The ‘old normal’ is not coming back.
Ladies and Gentlemen,
At the global level, we are beginning to see signs of economic recovery. This is evident in our region as well. In Malaysia, the various policies implemented by the Government will continue to contribute to strong economic recovery in 2021. Our Central Bank has forecasted that we will be able to achieve between 6 to 7.5% growth by the end of 2021.
It is undeniable measures undertaken during this pandemic have led to the increase in fiscal deficit and government debt. In 2019, our deficit was at 3.4% of the GDP. In 2020, this went up to 6.2%.
Of course, the recovery packages have led to some pressure on our fiscal situation. However, Malaysia remains committed to long term fiscal consolidation.
Ladies and Gentlemen,
For every crisis, there is an opportunity. Malaysia must use this opportunity to increase its productivity and competitiveness, in order to get ahead in the post-COVID 19 global economy.
Innovation-led private sector growth and public investment will both be required to provide quality jobs.
Going forward, the Government’s focus will be on digitalization, labour market reforms, social protection, poverty eradication, public sector optimization, retooling and retraining of workers, and environmental sustainability. These reforms will go a long way in addressing a number of structural issues facing our economy.
At the international level, we must all do our level best to enhance cooperation and coordination. We need to engage more with each other. Travel bubbles and vaccine passports can help in ensuring a smooth transition to normalcy in the post-pandemic world.
Thank you, and all the best to everyone participating in this forum.
News From Mission