The study by the market research and consulting company involved over 100 businesses nationwide and was carried out from June to July this year.

The participants voiced concern over uncertainty of government policies such as taxation, trade and investments which would significantly impede business decisions.

For large local enterprises and local small and medium enterprises (SMEs), this topped their list of concerns.

Large enterprises said the possibility of contract termination, re-tendering or delays was second on their list, followed by the depreciation of the local currency.

For SMEs, meanwhile, complying with new regulations was their second concern followed by the ringgit depreciation.

“While there has been a lot of communication between the new government with the media and the public, there is still an opinion among businesses that there is a lack of clear and comprehensive direction from the government,” the survey said.

“There is also a desire among businesses for further clarity concerning the status of some mega projects initiated by the previous government.”

Multinational corporations (MNCs) meanwhile were more worried about the fluctuation of the ringgit as this would affect their international trade operations.

But number one on their list of concerns was the costs involved in the reversal of the goods and services tax (GST).

According to the survey, the majority of businesses believed the government should focus on stabilising the local currency in order to minimise any risks in this area.

Large local enterprises said minimising red tape and regulatory burdens came next, followed by ensuring consistent policies and better governance in the public sector.

For local SMEs, improving financial support and assistance for businesses was first on their list, followed by stabilising the currency and ensuring consistent policies.

MNCs meanwhile ranked stabilising the ringgit first, followed by ensuring consistent policies and better governance in the public sector.

“The majority of businesses are generally optimistic towards the Malaysian economic outlook over the next one year, with MNCs expressing slightly higher levels of optimism,” the survey said.

“This sentiment is largely underpinned by the hope that the new government will come up with policies and initiatives which are expected to restructure and boost the economy.”

It said the overall positive sentiment on the economy also translated to an upbeat sentiment on their own business prospects, partly due to the expected improvement in the local business climate.

“The good news is that given the smooth political transition, Malaysia’s long-term attractiveness as an investment destination and a place to do business is now stronger.

“However, the government will now need to communicate a clear, consistent and comprehensive economic policy, failing which businesses may start losing their optimism and hold back in making any business decisions,” said Ipsos business consulting country head Kiranjit Singh.

“The current upbeat mood among businesses can quickly turn downward if the uncertainty continues.”