PAGOH: The National Recovery Council (MPN) recommends that banking institutions should consider offering moratoriums to small and medium enterprises (SMEs), especially those that are still struggling to recover post-Covid-19.
Its Chairman Tan Sri Muhyiddin Yassin said there have been three MPN meetings to discuss SMEs, which, among other things, have asked for financial assistance since some of them are still unable to recover and business is declining.
This is coupled with the increase of the overnight policy rate (OPR) three times this year, which is seen to not only affect the momentum of the country’s economic recovery but also the performance of SMEs, which now contribute to 90 per cent of the country’s economic activity, added the former Prime Minister.
“In the last (MPN) meeting, they (SMEs) requested that the banking institutions review (whether) it is possible to hold another special moratorium. (I think) even with the moratorium, they (banks) will not lose much. For a little while, they (SMEs) want to recover but cannot recover anymore (now).
“(If SMEs) want to borrow money, the bank (will) say first that they have not paid (the loan). Now, the OPR has gone up, (if) they want to borrow again, (the bank will) ask for a track record of the past year or two (but) after a year or two, they will show a loss. If you want to base it on normal conditions, (they) will not recover,” he told reporters after the Jualan Prihatin Rakyat in Bukit Pasir, here, Saturday.
Muhyiddin, who is also Pagoh MP, hopes the Government will also see the impact on the SME sector which is seen as one of the main sectors that contribute to the national economy.
“Yes. It (OPR increase) will have an impact. Even now we (MPN) are paying attention. Among other things, the issue of people’s poverty and the issue of the recovery of the economic sector, especially SMEs.
“If they (SMEs) are not active in producing marketable production, which can be competitive, it means that the recovery will be affected. (Recovery) is getting slower with the burden of costs, the increase in the inflation rate and so on, this will be a big problem,” he said.
In addition, Muhyiddin also hopes the Government will look at the increase in the OPR while also finding a way to help reduce the burden on the people in the coming presentation of Budget 2023.
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