Services sector’s revenue fall due to the MCO

PETALING JAYA: The services sector generated an estimated revenue of Rm83.29bil during the first three phases of the movement control order (MCO) up to April 28, representing a drop of 38.6% in its estimated average monthly revenue.

The Department of Statistics Malaysia (DOSM) said the wholesale and retail trade subsector, which posted the highest revenue at Rm63.5bil, saw a 36.6% slump.

“Wholesale trade is expected to record a revenue of Rm34.77bil or a 28.2% drop, followed by retail (Rm27.76bil, -32.4%) and motor vehicles (Rm0.97bil, -90.9%),” the department said in a newsletter focusing on the MCO’S impact on the services sector.

Meanwhile, the transport and storage subsector posted Rm2.66bil in revenue, a sharp fall of 69.9%.

The services subsectors that suffered the largest percentage drop were the arts, entertainment and recreation segment (Rm0.75mil or a decline of over 90%) and food and beverage (Rm0.80bil, -86.4%).

During the MCO period spanning March 18-April 28, all services subsectors recorded less revenue except for information and communications, which reaped Rm11.92bil or an increase of 2%, DOSM said.

The department noted that during the first two phases of the MCO (up to April 14), the services subsectors that were allowed to operate were information and communications, transport and storage, financial, health, food and beverage, accommodation, wholesale and retail trade, and utilities.

For phase three, the government allowed several more economic activities to operate.

DOSM pointed out that in Malaysia, the services sector was the largest economic sector. It contributed Rm771.9bil or 56.7% of the gross domestic product in 2018.

During the MCO period, only essential services were permitted to operate.

“The closure of a large portion of the premises in the private sector has affected the country’s economy,” DOSM said.