Thursday, July 29, 2021

2020, an unprecedented year filled with unprecedented measures

The combination of politics, public health and economic issues has made 2020 a year unlike any other.

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If there is an epitaph for the year 2020, which is coming to a close, it would be something like this: “Unprecedentedness was everywhere. It reliably eluded comprehension; past and present lenses illuminated the familiar, thus obscuring the original by turning the unprecedented into an extension of the past, contributing to the normalisation of the abnormal, which made coming to terms and fighting the unprecedented even more of an uphill struggle.”

All of the major twists and turns this year can be thus summarised: an unprecedented year requiring unprecedented measures, along with unprecedent changes in mindset to cope and survive.

The year started with the unprecedented Covid-19 virus rearing its ugly head in China. From an epidemic there, it became a pandemic as more and more countries were infected and impacted by the lethal virus.

When things got too hot to handle, words like “lockdown”, movement control order (MCO)”, “close contacts”, “contact tracing” and “social distancing” became household names.

At the time Malaysia was first stricken with this virus in the early months of 2020, daily infections were in the region of one to two digits. By mid-February, it looked like the battle against the virus had been won when daily infections stayed at zero for a consecutive number of days.

This led to complacency in the form of dithering over whether the country’s borders should be unprecedentedly closed. Politicking went on an unprecedented overdrive, resulting in a political crisis that ended up with a new government taking office.

During the political crisis in late February which was precipitated by the Sheraton Move, no one in the government (or rather the government of one person in the form of an interim prime minister) monitored the huge religious gathering of the Jemaah Tabligh, which by the time the new government took office in March, had the Covid-19 virus in a second wave which brought daily infection numbers back to two-digit and much sooner, unprecedented three-digit figures.

By the time the tabligh cluster had ended on July 8, with no new infections reported for 28 days, a total of 42,023 individuals from this cluster had been screened and 3,375 positive cases detected, accounting for 39% of the total number of positive Covid-19 cases in Malaysia then.

In combating this unprecedented second wave of the Covid attack, the new government introduced unprecedented, bold moves: the complete closure of the country’s borders and the MCO which was put into effect on March 18 for two weeks, confining people to their homes. They were urged to go out only when necessary in an attempt to flatten the infection curve.

The government also ensured that the health system would not be overwhelmed by converting hospitals into a battle-ready Covid-19 zone, creating more quarantine facilities and roping in more frontliners including retired nurses and doctors.

Even though the MCO crippled the economy, costing as much as RM2.4 billion a day, there was a newfound unprecedented unity and solidarity among the rakyat in supporting the government in its fight against the deadly virus, as they saw that the government was doing its best to balance lives and livelihoods.

There were no protests when houses of worship were closed during the MCO – a sharp contrast to the US and Europe where things like a lockdown and even SOPs for the use of masks were the subject of protests, further worsening the state of the global economy.

On the economic front, despite the perfect storm of a slowing economy and the trade spat between the US and China which was already entrenched in late 2019, and the emergence of Covid-19, Malaysia was one of the few countries that managed to record an unprecedented positive GDP growth of 0.7% during the first quarter of the year.

But with the MCO extended until early May, with only essential economic sectors allowed to operate, the stage was set for a deep GDP contraction of 17.1% during the second quarter.

To cushion the impact on the people and ensure the survival of the economy, the government announced an unprecedented stimulus Prihatin package of RM250 billion in March – the biggest and most generous stimulus ever announced by the prime minister of Malaysia.

An automatic moratorium of six months on loans for all beginning in April was given. This was followed by the stimulus package for SMEs amounting to RM10 billion which featured, among other things, a refined wage subsidy programme and incentives for companies to go the route of digitalisation as the new norm of doing business.

On May 5, the economy was given a boost when the MCO morphed into the conditional MCO with the gradual reopening of the economy. Finally, when daily infections were back to two- and one-digit figures in early June, the recovery MCO was introduced on June 10 where more sectors of the economy were opened up.

Things seemed to be a bit rosy by early September when the rise in unemployment was arrested throughout the months of May up to September and the manufacturing production index exceeded 50% for much of June up to September, culminating in a contraction of GDP for the third quarter to a much smaller 2.7%.

Things, however, started to unravel in late September when politicking reared its ugly head, causing political instability, first through a power grab that led to a snap state election being called in Sabah. At the federal level, it was opposition leader Anwar Ibrahim playing the numbers game by claiming the government had fallen because he had a formidable and convincing parliamentary majority with statutory declarations of support allegedly signed by some MPs to become the prime minister.

The fallout from the Sabah state election was the emergence of a third wave of Covid-19 infections beginning in late September which still bedevils the nation today with daily infections in the region of four-digit figures and cumulative infections breaching the 100,000 mark as of last week.

This third wave also features higher daily infections in some states, particularly Sabah, Selangor and Kuala Lumpur, causing a benign conditional MCO to be reimposed which costs the country about RM300 million a day.

Things came to a critical head when the government decided to advise the king to declare a national emergency which was rejected by the king who in turn commanded the rakyat to cast aside their differences and help the government in its fight against Covid-19 for the recovery of the economy, and for parliamentarians to pass Budget 2021.

Meanwhile at the economic level, the stimulus pertaining to moratorium and wage subsidies came to an end by September and there was concern that this would result in more suffering for the rakyat. This led Emir Research and many others to urge the government to practise the economics of empathy at this unprecedented time by extending the moratorium and wage subsidy for another three to six months with immediate effect.

This became highly politicised when, in anticipation of Budget 2021, political parties joined in the chorus asking for an extension of the moratorium and wage subsidy with a new demand for a lump sum of EPF money to be allowed to be withdrawn without any conditions as a prerequisite for their support of Budget 2021.

But the government dithered on all these suggestions and instead decided to put them all together under Budget 2021 as a sign of a bipartisan budget, which meant that implementation would only be done next year, if the budget was passed.

As the presentation of Budget 2021 on Nov 6 approached, politicking went on an unprecedentedly fever-pitched level, resulting in a downgrading of Malaysia’s sovereign debt by Fitch Ratings from A- to BBB+.

When Budget 2021 was finally passed along partisan line on Dec 15, the country finally breathed a sigh of relief, putting the opposition in a defensive position.

A postscript to the year came when it was announced that Malaysia would get its Covid-19 vaccins sin February. But this still generated mild politicking in the form of questions as to why the country would be receiving its vaccines two months later than neighbouring Singapore.

Jamari Mohtar is director of media & communications at independent think tank Emir Research.

The views expressed in this article are those of the author(s) and do not necessarily reflect the position of MalaysiaNow.

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