Here’s what a few Ministers as well as industry’s movers and shakers have to say concerning the industry at large and what measures could possibly address the trying times ahead with the now announced lockdown till the end of December once the six-month moratorium has been lifted.

The perfect storm was already long brewing over the stove of a prolonged sluggish economy, long before the pandemic even struck — taking the winds out of everyone’s sails in an unprecedented storm of untold proportions that was totally unanticipated. What’s more — sparing no one — it also wrecked its havoc across international borders. Various measures were announced by the governments worldwide, with the Malaysian government also announcing – amongst others, the six-month loan moratorium on housing and car loans. While this measure was a welcome relief — how far we have ventured into the eye of the storm remains to be seen. And, perhaps lulled into a false sense of security — what are the possible ramifications on society overall, once the six-month moratorium on loans is over? And, while the government has announced yet another wave of stimulus to assist entrepreneurs and businesses, it is clear that the storm is still ever raging strongly. Taking a cue from other countries overseas — like China and even Melbourne, Australia which relapsed into another lockdown — nothing should be taken for granted even during the relaxed Recovery Movement Control Order (RMCO) now already in place, as several cases have also emerged at this juncture. Various clusters have emerged sporadically — so it is clear that we are not totally out of the woods as yet. Perhaps, the best set of rules is to err on the side of caution even as the chains of the economy slowly and hopefully but surely, chug back into motion.

Datuk Dr. Jeffrey G. Kitingan Deputy Minister of Tourism, Arts and Culture Malaysia
As we all know it, the tourism industry – whether leisure or business is especially dependent on social media, given the nature of picturesque images as a point to introduce a destination to the world. Social media has dominated the world and of course with the rapid and vast adoption of these technologies, we get to engage with new partners, accessing information and to promote our latest offerings. Realising the importance, among the initiatives we set to engage with our partners includes current up to date tourism promotional campaign, live feed or updates on our flagship events, destination and venue promotions. In times of adversity, the power of unity and knowledge is what drives the resilience of an industry. From the days of Friendster, to the boom of Facebook, Instagram and now Tik Tok, stating that social media has rapidly taken over our lives is in fact, an understatement.

Terence Khoo Co-Founder & Director of ShieldZilla Essentials
After the lockdown, primary prevention will remain as utmost priority. Healthcare practitioners need to be as vigilant as ever to ensure that Hospital Acquired Infections (HAI) are prevented. Since the pandemic, additional safety or prevention measures have been introduced to protect not only patients and visitors, but also the front-liners while they are on the field.
Even after the six-month stage is over, Malaysians have entered into a “different” norm where it is of pivotal importance to know what we can do protect ourselves and our loved ones. The term “social distancing” is now commonly used, and people are expected to maintain good hygiene and wear face masks and use hand sanitizers whenever they leave their homes. This pandemic has driven a strong shift in the focus of what is currently trending especially in the area of primary prevention to stop the spread of the infection. The need for primary prevention has risen with an aging population and vulnerable people with chronic diseases mean that the demand for health essentials is crucial to safeguard their well-being.
Identifying this, ShieldZilla Essentials sees value in integrated forms of health essentials, emphasising on primary prevention by unlocking innovative products such as CUPRON Medical Textiles while optimising care delivery across the health field. Health essentials is visualised as an upcoming field since it emphasises continuous care connected to people’s daily as the trend is towards improving health outcomes while improving the work life of people and potentially lowering the cost of care.

Adrian Un Chief Executive Officer of SkyBridge International
After the six-month moratorium period, many Malaysians will still not be able to normalise the situation. Many people will still be struggling because the unemployment rate is still quite high. To counter this and to prevent more default or higher Non-Performing Loans (NPL), banks could actually initiate steps to provide a top up loan for existing loans subject of course, to the Debt Service Ratio (DSR) calculation just to tide them over, at least for the next one to two years at a very reasonable interest rate. In that way, banks can still keep this group of good profile customers afloat, granting them the top up loan without going through that much of documentation.
This will come in handy to customers of banks to ride through the storm. Secondly, we are still not seeing many approvals for bank loans despite the sales of developers units that have actually gained momentum. People are still buying under construction projects so banks should relax the approval process a little to keep the consumption going. Thirdly, the secondary market actually needs more boost than ever. Banks right now are performing a lot of evaluations before they approve the loans for the secondary market. However, I think given that given certain locations are still prime, banks shouldn’t be too uptight in slashing the margin of financing. Fourthly, banks seem to be reluctant to give financing to certain industries like the automotive, aviation plus the oil and gas industries and to commission based earners. Banks should design loans on an approval matrix and not give a blanket decline on these industries but look at each case separately. If they give a blanket decline or rejection on certain industries, this will prevent buyers from buying the properties resulting in very negative sentiment in the property industry.
Lastly, the Housing Ministry should do a massive roadshow promotion either online or via other methods to sell KLCC properties to foreigners especially those from Hong Kong or China. If they continue to remain silent on this, many KLCC developers will struggle as generally, Malaysians are not buying there so there will be a lot of oversupply or overhang of KLCC properties. The only way is for the properties to be cleared as soon as possible. The only way to do this is to have a massive government boosted promotion made available to foreigners as a concerted effort with participation from most of the KLCC developers. And, they must do this within the next six months to clear stocks. As far as the Vacancy Tax is concerned, I don’t think we should embark on this decision recently because if this were to happen, the surrounding property prices subjected to the Vacancy Tax will spiral downwards. If there’s a Vacancy Tax, developers will be hard pressed to sell their existing supply at a very high discounted rate. This will have a multiplying effect on existing properties and will cause prices to drop even further. This is a very high risk for the property industry. Many existing owners will suffer so this is a bad move. We still have ample land supply so the Vacancy Tax should be postponed or shelved.

Datuk Seri Garry Chua Immediate Past President of MRCA and Chairman of F&B Chapter
Representatives from the Malaysia Retail Chain Association (MRCA), Small and Medium-Sized Enterprises (SME) Association and other associations met up with Bank Negara Malaysia (BNM) to present their views. If the banks won’t extend the moratorium, then they could consider the borrowers who are struggling to pay their loans to not pay the principal first but settle the interest perhaps. We’ve suggested to BNM to have a bureau should this loan issue be unfairly retreated as a recourse. Most retailers are only hovering at generally 50% to 60% sales as opposed to previously but the good thing is the crowd is coming back. But most importantly, Standard Operating Procedures (SOPs) have to continuously be adhered to as we cannot afford a resurgence of cases resulting in another lockdown which would entirely wipe out businesses altogether.

Dato Michael Kang President of the SME Malaysia Association
I think that the extended three-month extension on the loan repayment after the six-month loan moratorium loan that is in effect would be only a conditional offer. It not an open blanket extension and not everyone can get it. We hope banks can assist the SMEs to survive the pandemic. This is a good move and we hope all the bankers will be able to do this to help SMEs extend or restructure their loans. Bank Negara Malaysia states that banks cannot use the Credit Tip-Off Service (CTOS) report as an excuse not to help SMEs extend or restructure their loans. Our hope is that for most SMEs – if they can’t pay their loans come October 2020, to contact their bankers to try and restructure their loans. If there is another round of resurgence, the government needs to step in. Now, many SMEs are living on the borderline of survival so we need support and cooperation from the banks. If SMEs face problems, banks will also face huge losses. Even if banks take action in filing SMEs for backruptcy, this will not benefit them either as they will definitely not be able to recover their funds as well. Thus, if banks can assist SMEs to survive, then they will have ongoing business and they will be able to serve their loans.

Sr Mike Geh Immediate Past President of The International Federation of Real Estate (FIABCI) Chapter of Malaysia
I don’t think that the end results will be that dramatic since we now have a Prihatin government. From my gauge, banks are going to be friendly to their existing borrowers — meaning there won’t be a blanket moratorium but there will be the option for those seeking further extension to visit the bank and request to stretch the loan repayment further. However, I don’t think there will widespread options after September as I believe banks will be more prihatin to their customers and try to work out a viable solution at the borrower level such as stretching and extending the duration of the loan.
I don’t think there will be a widespread drop of residential values of about 40% to 50%. Therefore, I don’t see auctions being triggered immediately after lockdown. Starting an auction procedure will take at least three to six months so property prices will not drop right away. I think that in the next six months — the property outlook will see a lot of overhang units. Thus, I believe issues of overhang should be more detailed and analysed as a majority constitute unsold Bumiputera units that have not been released. I find the last six months exceptional because local developers who embarked on the digital platform performed well in their sales. The Home Ownership Campaign (HOC) was on since the last six months so I want to emphasise that there is an activity in the market.
There are also many developers announcing that they will be able to meet their sales target including Mah Sing Group Bhd, SP Setia Berhad and Eco World Development Group. Therefore, the horse or the market is not dead and developers are still selling as compared to other countries and chapters other than Singapore and Malaysia in terms of property buying sentiments.
Properties in Singapore are still selling although there is a slight price drop. However, property is still moving and it’s not headed off the cliff with no buyers or sellers as there is still activity. In Malaysia, we ended the lockdown quite early and are ahead of a few countries including Indonesia besides other regional countries. Malaysia is one of the acknowledged leaders to have contained Covid-19 in Asia. This is a plus point in the property market because really post Covid-19, if there is no more resurgence cases and a vaccine is found, I foresee that more Indonesians and Hong Kong people who are interested in buying properties here will spend more time in Malaysia. Even in the midst of Covid-19, the Hong Kong and Indonesian people were expressing interest in buying properties here and spending more time in Malaysia.

Shirley Tay President of the Malaysia Retail Chain Association (MRCA)
I think it is important for the RMCO to be extended as there are still new cases daily. Though Malaysia is seen to be effective in controlling the spread of Covid-19, the virus has not been totally eliminated. We cannot afford to take any risk as another MCO will impact the economy badly, let alone risking losing many precious lives.
Many businesses especially those without much resources and those badly affected by the earlier enforced MCO are still struggling. The need to now put measures in place so businesses can resume operations need to be done so they can operate otherwise paying their loans will be burdensome. Though their bankers have allowed them to discuss in terms of some forms of relaxation or to restructure their loan repayment schemes, in reality, this will not solve their cash flow problems. Many businesses would need the government to also come up with some more stimulus packages. The crucial problem to resolve also relates to contracts with landlords, suppliers, creditors besides the pressure of retaining their employees.

Sr Lim Boon Ping President of the Malaysian Institute of Estate Agents (MIEA)
The good news is that the property market didn’t crash. I don’t foresee doom or gloom but I’m not saying that nobody will default on their loans. MIEA wrote in an official proposal to Bank Negara Malaysia to introduce interest only. There will be defaulters but the situation is not as serious as anticipated, especially when the lockdown first started and everyone was wondering when it would end. The first lockdown was two weeks long which was then followed further by another extension. However, when the moratorium announcement was made to assist borrowers with the lowering of interest rates setting in, these measures helped people to hold on to their properties so the market didn’t crash.
Penjana came in after that whereby the government waived the Real Property Gains Tax (RPGT) with the waiver of stamp duty only for the Home Ownership Campaign (HOC) and removal of the 70% cap on the third residential loan which had a positive effect to stimulate sentiment. The budget will be announced soon and the third wave coming in from the budget will help to stimulate the economy. On the other hand, our government’s pandemic crisis management is one of the best in the world after Taiwan. This has further created more business confidence with Malaysia internationally. Secondly, the government is introducing a lot of stimulus and protection plan like the moratorium. This means a lot for 90% of those whose salary is affected. The next phrase after the six-month moratorium, will see a lot of Refinancing and Restructuring (R&R) for people to stay alive. So, it’s all about reducing the monthly commitment to stay afloat. Everyone has now got to look at financial planning very seriously especially the younger generation. If they have not gone through the crisis and if the government didn’t help them, they will go through very tough times and the younger generation especially always needs to plan for the worse to happen.

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