KUCHING: This is the time for Sarawak government to utilise part of its RM31 billion reserve to save the small medium enterprises (SMEs) in Sarawak by subsidising 50 per cent of wages of all business employees adversely affected by the Covid-19 pandemic, opined DAP Sarawak chairman Chong Chieng Jen.
“Sarawak government has a reserve of RM31 billion. Reserves are meant for rainy days. We are now in a mega storm.
“This is the time to utilise the reserve fund to help our people. DAP Sarawak will definitely support the bill to utilise such fund when tabled in Dewan Undangan Negeri,” he said in a statement Tuesday.
He added DAP Sarawak proposed that the state government should inject funds to help Sarawak SMEs by subsidising 50 per cent of all the employees’ wages in Sarawak for the next six months.
“This is to help businesses to sustain and minimise retrenchment.
“We estimate that with proper strategy and implementation of such wage subsidy, an approximate RM5 billion will be more than sufficient,” he said.
Chong pointed out that the economic stimulus package announced by the Prime Minister was a huge disappointment for the SMEs in Malaysia.
“Never has any announcement of economic policies in Malaysia generated such anger among the SMEs.
“The SME companies have to continue paying the full salaries of their employees, yet the government is giving nothing to compensate the loss suffered by the SMEs due to the Movement Control Order (MCO) and the dire state of economy resulting from the Covid-19 pandemic,” he said.
Chong lamented that even the RM600 subsidy for employees is tied to the condition that the employer suffers more than 50 percent drop in revenue since January this year and it only covers those employees whose monthly salaries are less than RM4,000.
“Furthermore, when all economists are expecting the Covid-19 triggered economic recession will last up till the end of the year, this wage subsidy will only be provided for a period of three months,” he said.
Chong pointed out that the contribution of the SMEs to the country’s economy should never be underestimated, saying that SMEs contributed to 38 per cent of the national GDP in 2018, contributing RM521.7 billion out of the national GDP of RM1,361.5 billion.
“SMEs are the backbone of our country’s economy. The effect of the SMEs closing down will not only be felt amongst the SME sector but will severely impact the other non-SME sector.
“If SMEs falls, the economy of the whole country will fall. That is a fact that the government must always keep in mind when formulating economic stimulus policies,” he said.