Program Strategik Memperkasa Rakyat dan Ekonomi Tambahan (PEMERKASA+): The Lockdown Tempers the GDP Outlook
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The critical stage in the race to end deadly COVID-19 pandemic with exponential rise in infections and deaths as well as overloaded healthcare system, has forced on the Government to implement a three-phase nationwide lockdown that will start with a "total lockdown" from 1-14 June 2021; followed by four weeks under the second phase of lockdown; and the third phase, which will be similar to the Movement Control Order (MCO) restrictions presently in force.
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The Government introduced a RM40 billion Program Strategik Memperkasa Rakyat dan Ekonomi Tambahan (PEMERKASA+), the 8th economic stimulus and recovery package rolled out since 2020. It contains twelve initiatives to strengthen the capacity of public healthcare system; ease financial burden of households and individuals; and ensure the business sustainability of SMEs and micro business.
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The RM5.0 billion fiscal injection will be funded either through savings on expenditure by reprioritising, borrowings as well as increasing revenue from dividends derived from government-linked companies and statutory bodies.
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It is likely that the Federal Government’s overall fiscal deficit target may be tweaked higher from the current estimates of 6.0% of GDP in 2021 (2020: -6.2% of GDP). Similarly, the statutory debt level could be increased above the present estimated 58.5% of GDP by end-2021 (Debt ceiling is set at 60% of GDP).
