He said if the economic sector is closed, the number of unemployed people is expected to reach one million, which will impact four million people based on an average family size of four persons.
The impact of a full-fledged MCO would be greatly felt by the low-income group and workers in the informal sector, Tengku Zafrul said, while senior minister for security Ismail Sabri Yaakub said at a separate media briefing that the MCO in March last year had affected petty traders who relied on daily income.
“If we close again, they will have no daily income. During the first MCO we heard the plight of families having to eat rice with just salt water to survive. This really happened among the poor and the B40 groups,” he said.
Tengku Zafrul said: “If controls are too tight and the economy is closed, yes Covid-19 cases are reduced but at a severe cost to the rakyat, but if controls are too lax, it will lead to an explosion of Covid-19 cases which also will undermine the economy.
“We need to be mindful that the manufacturing sector also employs many low-income Malaysians. In a situation like this, a full-blown MCO will not only increase unemployment, but cause more harm to the people, while the social impact will take a long time to recover,” he said at a press conference today.
Tengku Zafrul said 68% of businesses reported no sales or revenue during the first MCO in March-May last year, while 42.5% of businesses needed more than six months to recover, and two out of three businesses had outstanding debts within six months.
The best solution in balancing between protecting the lives and well-being of the people was through targeted and a tightened MCO and not a full-scale lockdown, he said.
“Moreover, the government is committed to continue various targeted assistance to help affected individuals and businesses. Various assistance will continue to be channelled throughout the year,” he said.
The tightened restrictions of the MCO from May 12 to June 7 is estimated to have an impact of up to 1% on the gross domestic product (GDP), he said.
During the first MCO from March to May last year, the economy suffered RM2.4 billion in losses daily while during the January-February lockdown this year it is estimated to have cost the economy about RM300-RM400 million a day.
He said the new month-long restrictions could reduce this year’s GDP growth to about 5%-6.5%, slightly lower than the 6%-7.5% forecast by Bank Negara Malaysia earlier.