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Malaysian government mulling stimulus package as coronavirus outbreak takes toll on economy

Malaysian government mulling stimulus package as coronavirus outbreak takes toll on economy

File photo of Kuala Lumpur's skyline. (Photo: AFP/Mohd Rasfan)

PUTRAJAYA: The Malaysian government is looking to launch a stimulus package to mitigate the economic impact of the novel coronavirus outbreak, Prime Minister Mahathir Mohamad said on Monday (Feb 10).

He noted that the tourism industry has been most affected, as the drop in arrival numbers has a direct effect on the Visit Malaysia 2020 campaign.

"When we announced the campaign, we did not expect the coronavirus (outbreak). But now, we have to stop airlines from flying to several areas in China,” he said during a question and answer session with French multinational companies.

Malaysian Prime Minister Mahathir Mohamad being interviewed by Reuters in Putrajaya in December. (Photo: Reuters/Lim Huey Teng) FILE PHOTO: Malaysia's Prime Minister Mahathir Mohamad looks on during an interview with Reuters in Putrajaya, Malaysia, December 10, 2019. REUTERS/Lim Huey Teng

He added that Chinese tourists constitute a huge fraction of the tourist market, thus the tourism industry would have to brace for impact following their absence.

However, Dr Mahathir did not elaborate on what concrete measures the government will be taking to boost the economy.

Many airlines, including Malaysia Airlines and AirAsia, have cancelled flights to and from China amid growing fears of the coronavirus. 

READ: Commentary - Novel coronavirus outbreak weighs heavily on global economy

The outbreak has claimed more than 900 lives, with more than 40,000 of confirmed cases recorded globally.

As of Monday, there were 18 confirmed cases of the novel coronavirus in Malaysia, of whom 12 are Chinese nationals.


At the weekend, Finance Minister Lim Guan Eng said his ministry will look at the duration and impact of the coronavirus outbreak in Malaysia, before deciding on the suitable quantum for the stimulus package.

Finance Minister Lim Guan Eng says the government is working to improve the economy. (Photo: Fadza Ishak)

"This (the stimulus package) cannot be done in a hurry, we need to look at the impact to ensure that those who are affected will get the help they need, and to do that, we need to get input from various parties,” he was quoted as saying by the Star.

"Many economic analysts are saying that the outbreak would not last a long time, which is why we need to ensure that the package would assist those who need it to remain sustainable.”

READ: Singapore's tourism, transport sectors to get targeted help in response to coronavirus economic impact

Mr Lim also said his ministry will meet with tourism sector players on Monday to discuss the impact of the outbreak.

"I will meet with everyone involved in the tourism sector. We will discuss the matter,” he was quoted as saying by the New Straits Times.

"And after (the result of the discussion is) presented in Cabinet, we will make an announcement," he added.


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