‘Monitor Covid-19 pandemic’s impact via economic indicators’
The pandemic has caused major challenges to the global economy. Almost all countries worldwide experienced an economic slowdown in 2020 and likely to deteriorate further.
Datuk Seri Dr Mohd Uzir Mahidin
KUALA LUMPUR: It is crucial to regularly monitor the challenging situation brought on by the Covid-19 through the economic indicators in order to lessen the adverse impacts on the economy, said Department of Statistics Malaysia (DOSM) chief statistician Datuk Seri Dr Mohd Uzir Mahidin.
“The pandemic has caused major challenges to the global economy. Almost all countries worldwide experienced an economic slowdown in 2020 and likely to deteriorate further,” he said in a statement yesterday.
He cited the latest indicators for certain countries, including China which recorded a rapid growth of 6.5 per cent in the fourth quarter (Q4) of 2020 with improved exports and manufacturing sector performance.
On Malaysia’s performance, he said export performance continued to show signs of recovery in November 2020, marking the third consecutive month of year-on-year (y-o-y) growth.
Exports grew 4.3 per cent yo-y in the month, supported mainly by higher exports of merchandise to major trading partners, namely the United States, Singapore, China, Hong Kong and the European Union.
“(However,) imports declined by a more significant magnitude of negative 9.0 per cent,” he said.
Meanwhile, the Industrial Production Index (IPI) recorded a decline of 2.2 per cent in November 2020 compared to the same month of the previous year.
“However, the manufacturing sector, which was the largest component in the IPI, posted a 2.0 per cent (increase), steered by the growth of both exports and domestic-oriented output,” he said.
In contrast, the sales value of the wholesale and retail trade in November declined by 1.2 per cent y-o-y due to the weaker performance of retail trade which contracted 2.3 per cent.
In November 2020, the Producer Price Index (PPI), which measures the average price change imposed by local producers on their output, fell at a smaller rate of 3.0 per cent y-o-y due to the decrease in the mining, electricity and gas supply, and manufacturing sectors.
He said a similar trend was observed in the Consumer Price Index (CPI) for the same month, with the CPI declining 1.7 per cent y-o-y.
However, based on December 2020 statistics, the CPI improved to negative 1.4 per cent, bringing the contraction in Q4 2020 to 1.5 per cent.
Mohd Uzir said that 2020 had been a whirlwind of challenges to tackle the Covid-19 pandemic and the repercussions from the implementation of the different phases of Movement Control Order (MCO) to the Malaysia’s economy.
“As the MCO 2.0 implementation is still ongoing until Feb 4, 2021, the implication of a more stringent standard operating procedures of business operations and restriction on interstate travel might have undesirable effects on the economy.
“Fortunately, the Malaysian Economic and People’s Protection Assistance Package (Permai) has been implemented straight away after the MCO 2.0 to ease people’s financial difficulties as well as maintaining economic resilience while the country face the spread of the Covid-19 pandemic,” he said.
Mohd Uzir said based on the Leading Index (LI) for November 2020 which recorded 109.1 points – a 7.1 per cent increase from November 2019 – the Malaysian economy in 2021 was expected to remain in the pace of recovery.
“Meantime, the monthly change in LI also recorded a growth of 0.4 per cent in November 2020 as compared to the previous month.
“Despite a better improvement of LI, the reimplementation of MCO, which objective is to strike a balance between health and economy, would post some ramifications especially in terms of recovery momentum,” he concluded.