KUALA LUMPUR: The economic impact of the extended Movement Control Order (MCO) may be more severe to sectors classified as “non-essential services”, especially the manufacturing sector for exports.

Prime Minister Tan Sri Muhyiddin Yassin on Friday announced an extension of the MCO by another two weeks until April 28.

Muhyiddin said this was imperative to prevent the Covid-19 pandemic from escalating and infecting more people in the country.

Bank Muamalat Malaysia Bhd economist Izuan Ahmad said the government should address MCO issue by having discussions with the relevant sectors on whether to allow non-essential services to resume operations albeit within tight and strict control.

“The decision or other options are important to avoid further negative impact on the non-essential services sector,” he told the New Straits Times (NST) yesterday.

He, nevertheless, said the extension was a positive step to curb the pandemic.

He called for a smooth implementation of the RM260 billion Prihatin stimulus.

“Efficient implementation of the allocations to the respective beneficiaries is crucial to avoid further adverse impact from this extended MCO,” he said.

Putra Business School business development manager Associate Professor Dr Ahmed Razman Abdul Latiff expects businesses and organisations to encourage their workers to continue working from home especially if they have the technology and system for that purpose.

“Some businesses will improve on their logistic and supply chain to cater for the changing behaviour of their customers who probably wanted the product or services delivered to them rather than they go to the business premises,” he told the NST.

He said psychologically, people would likely behave differently after MCO, as majority of the public would still practice social distancing and wear masks.

“However, the working people and those with businesses to handle will be eager to resume their working life especially those who are getting lower pay or not getting paid at all during the MCO,” he said.

Ahmed Razman said it would probably take months to return to normalcy given that global economies were facing possible recession for the next few months.

“Domestic economic activities will be subdued and sluggish as people will still be afraid to spend and would rather save their money.

“The customer confidence level needs to be improved to kick start the business activities again,” he said.

He expects the country’s gross domestic product to ease by 2.0 per cent or about RM34 billion due to the pandemic.

This translates into a reduction in monetary value of all finished goods and services made during the first-quarter of 2020.

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