Shots In The Arm

The devastation wreaked by the pandemic on Malaysia’s economy is clear for all to see, but government stimulus packages and financial incentives are riding to the rescue of the country’s real estate sector

- AL Gerard De La Cruz

With stimulus funds being thrown around like so much confetti, the pandemic has highlighted the extent to which governments can provide financial succour to their people.

Malaysia has unfurled one package after another since the virus took hold in the nation in January 2020. One year later, King Al-Sultan Abdullah would declare Emergency (Essential Powers) Ordinance 2021, suspending parliament and postponing elections at the request of embattled Prime Minister Muhyiddin Yassin.

On the face of it, the move was merited; so was federal administrative capital Putrajaya’s version of the lockdown, the Movement Control Order (MCO). Malaysia, after all, had the third-highest Covid-19 caseload in Southeast Asia.

In a narrative replicated with some variations across the region, GDP growth in Malaysia last year contracted by 5.6%, the steepest economic plunge since the 1998 Asian financial crisis. Overall property transactions plunged almost 28% by volume—31.5% by value—in the first half of 2020 from the same period in 2019, according to figures from the National Property Information Centre (NAPIC). Transaction volumes and values within the residential segment alone plunged 24.6% and 26.1%, respectively, as sales rates hit a low of 3%.