Malaysia unveils new stimulus package to counter COVID-19 impact

The package includes 128 billion ringgit for the people welfare; 100 billion ringgit for businesses including small and medium enterprises; and 2 billion ringgit to strengthen the country's economy.

The total package has included the first economic stimulus package worth 20 billion ringgit which was announced in February.

Muhyiddin said in a televised address that the government's priority at the moment is to curb the spread of the COVID-19 outbreak, and the budget would help ease Malaysians' burden amid the crisis.

"We are a nation at war with invisible forces. The situation we are now facing is unprecedented in history," he said. "This unprecedented situation of course requires unprecedented measures."

Some key highlights of the stimulus measures included a 500-million-ringgit allocation for Malaysian Health Ministry to ramp up its healthcare capacities; a 1-billion-ringgit for the purchase of equipment and services to combat COVID-19. A total 10 billion ringgit one-off cash payment will be given to the middle and low income groups too.

The government also reiterated the implementation of all projects under Budget 2020, which included construction projects East Coast Rail Link and Mass Rapid Transit 2, as well as the National Fiberization and Connectivity Plan.

Socio-economic Research Center executive director Lee Heng Guie said in a statement Friday that the latest economic stimulus package is bolder as the government acted decisively to provide a timely and much needed financial assistance support to households as well as to businesses to manage cash flow challenges.

"While the package is unlikely to avert a recession this year, it is expected to ease the magnitude of economic contraction," he added.

Fitch Solutions on Friday revised Malaysia's 2020 real GDP growth forecast to 1.2 percent, from 3.7 percent previously, in light of the downside risks including a likely sharp downturn in the global economy.

"(Malaysia)'s exports are likely to fall sharply amid lower oil prices and failing external demand as the world slips further into recessionary conditions," said the global research house, adding that private consumption in the country is also dragged by existing movement restriction orders to contain the spread.