FMM calls for more energy related assistance for industries
KUCHING: The Federation of Malaysian Manufacturers (FMM) hopes to see more energy related assistance for businesses, following the Energy Commission’s statement that no surcharge will be imposed under Imbalance Cost Pass-Through (ICPT) review for the period from July to December 2020.
Given the drop in global fuel prices, FMM said the industry had expected to see a drop in overall electricity tariffs which would have been most welcomed and provide a reprieve to manufacturers during the current challenging period as there has been very little assistance for manufacturers in relation to mitigating energy cost impact caused by Covid19 and movement control order (MCO).
“The industry is looking forward to more reliefs from the energy providers in particular for the more severely affected manufacturing sub- subsectors including those heavily linked to the construction and hospitality sectors,” said FMM president Tan Sri Soh Thian Lai in a statement.
“The Department of Statistics had indicated that given the current global economic climate, manufacturing sector would require some time to recover from the adverse impact of Covid-19 pandemic as it is strongly dependent on the global demand, whereby almost 69 per cent of the nation’s manufacturing output is exported.”
Total exports had recorded consecutive decline of 25.5 per cent in May and 23.8 per cent in April while imports declined 30.4 per cent in May and eight per cent in April.
In particular, the manufacturing sector’s output in April 2020 had contracted 37.2 per cent year- on-year, while its exports and imports in May 2020 declined by 23.5 and 28.5 per cents respectively.
Unemployment rate, meanwhile, had increased to five per cent and is expected to increase further in the coming months as businesses struggle to sustain their operations after the MCO period from the consequential impact of the Covid-19 pandemic on their business.
FMM is also calling for Gas Malaysia Energy Services (GMES) Sdn Bhd to defer its decision to impose excess gas charges beginning from July 2020 until the economy recovers.