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MTUC refute Tengku Zafrul's statement


KUALA LUMPUR 15 August - Malaysian Trade Union Congress (MTUC) urged the Malaysian ministers to stop going overboard in attempting to paint a rosy picture of the economy and the unemployment problem, more so after Bank Negara Malaysia reported that the country’s GDP was -17.1 per cent in Q2.

TUC Secretary-General, J. Solomon said, Malaysia’s Q2 showing, which forced BNM to reverse the country’s  2020 economic growth  to between -3.5 percent to -5.5 per cent, was worse than neighboring countries such as Singapore, Indonesia, Vietnam and the Phillippines.

                                                J. Solomon

Also on Friday, the Department of Statistics reported that private sector jobs in Malaysia decreased by 200,000, shrinking from 8.6 million to 8.4 million also in the second quarter 2020.

The Q2 GDP figures, the drop of jobs in the private sector and the unemployment rate of 4.9% or 773,200 people without work in June, should reflect the gravity of the problem and prod the government in taking necessary action to ensure the livelihood and survival of ordinary Malaysians. 

"MTUC accepts BNM Governor Datuk Nor Shamsiah Mohd Yunus assertion that with the gradual reopening of the economy, she is “cautiously optimistic that the worst is behind us, ” in releasing the Q2 figures. 

"On the contrary, Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz statement has been on  laced with over optimism of the economy which belies the situation on the ground,'' he said in a statement here today.


     Tengku Zafrul Tengku Abdul Aziz

Solomon said, the minister says that with each passing month, Malaysia recorded an improvement in its GDP, with the negative growth rates from April (-28.6%) reduced significantly by June (-3.2), after the Recovery  Movement Control Order was introduced.

"However, if businesses were coming back strongly over the past months with GDP ‘improving’ by leap folds as claimed by the minister,  why is it that the  official unemployment rate continues to be very high? 

"The official estimate of 4.9% or 773,200 people out of work in June certainly does not reflect Tengku Zafrul’s claim yesterday that the economy has “rebounded strongly,” based on the June GDP growth.  There is clearly a disconnect between his claims and the reality on the ground,'' he said. 

In fact said Solomon, the unemployment rate is well higher as the Human Resources Minister has admitted that companies were terminating their workers without reporting to the Labour Department. The official unemployment figures also does not take into account those self-employed who were forced to close shop and have no source of income.



"Based on our feedback, we have no reason to doubt the Malaysian Employers Federation projections of up to 2 million people losing their jobs by next year. While we will refrain to cast any doubts on Tengku Zafrul’s statement that the multi billion ringgit Prihatin and Penjana packages saved 2.8 million jobs, the fact remains nearly one million people,  or more do not have jobs,'' he said.

he decrease of 200,000 jobs in the second quarter of the year is a serious matter for the government to take note in light of the prevailing high unemployment rate.

In the best case scenario, the job market will take time to return to normal as domestic demand - while picking up -  remains fragile and employers are still reeling from the disruptions to the supply chain while international trade is still slow.

"It must not be forgotten that not all the problems stem from the MCO as employment in some sectors, such as manufacturing,  has been weakening for some time since the second half of 2018, before the Covid-19 pandemic pushed growth in the sector to negative levels,'' said Solomon.

MTUC according to him, expects global trade to remain affected by the continuing trade war and diplomatic spat between China and the United States. Global oil prices, the recovery of European economies and the US itself as well as geo-political developments across the world may all throw a spanner in the bullish outlook being touted by Tengku Zafrul.

More importantly, everyone should have both their eyes on the present situation, especially with regard to helping retrenched workers as well as fresh graduates joining the labour market.

Billions of ringgit have been taken up by employers in wage subsidies, soft loans and other forms of assistance, yet the return of investment (ROI) from all these public funds failed to stop hundreds of thousands of people from either losing their jobs or take deep pay cuts.

"The MOHR also spent close to RM100 million to develop two job portals which it claimed would help the jobless to find employment. Alas, there is little to show for the portals’ effectiveness, given the record numbers who remain jobless, despite government claims there are adequate opportunities for them, provided they were not choosy. 

"The cash hand out given by the government under Prihatin package in March to the needy has long gone. Come next month, the six month moratorium on loans repayment will no longer be automatic, meaning the borrowers will be left to the mercy of their respective banks. 



"Those who are lucky to get further moratorium extensions, will still struggle to balance their paltry paycheck with the high cost of living, especially in the cities,'' he said.

In all probability said Solomon, the coming months will be the toughest for the B40 and M40, irrespective of whether they get to further defer their loan repayments or not. Until a Covid-19 vaccine is available in Malaysia and elsewhere in the world, the economy will need much time and effort to be fully resuscitated. 

"During this testing times, those in the B40 and M40 must be helped with direct cash assistance and other forms of aid by the government to mitigate the high costs of living and ensure they have a roof over their heads and enough food on the table.       

"However, despite the government’s repeated proclamations to help them, this marginalised groups remain in dire straits and are the most vulnerable to retrenchments and pay cuts in the current economic downturn. 

As such, it is imperative that the government is not be seen as abandoning them, especially when it is confident that an economy recovery is around the corner.

As a nation, we must do all we can to help the blue collar workers, the self-employed, including petty traders and those in the gig economy to ensure they can sustain in this difficult times,'' said Solomon.

"They also need to be told the bare facts - that while Malaysia has made some strides in reviving the economy, there is still a long trek ahead and many challenges remain.  Malaysians, especially workers, must not be deluded into thinking we are on a quick fix mode that will see the economy bouncing back in full swing in 2021,'' he said.

The bold predictions of a 5.5% to 8% growth for 2021 must not blur the present daily challenges of workers struggling to make ends meet nor those rendered unemployed and have no income to support their families.

"MTUC calls on the government, especially the Finance Minister not to paint Malaysia’s economy canvas with just a broad brush of optimism, without laying out the complex challenges we presently face, both as a nation and as the working class. The rakyat need to know the hard facts, just as they need to see concrete and effective solutions from the government to address their bread and butter woes,'' said Solomon. -