Malaysia will grant a six-month delay on most loan payments to ease economic suffering caused by the coronavirus outbreak, the Central Bank said Tuesday, as officials in neighboring countries took aggressive measures to mitigate the pandemic’s expected financial impact.
In Indonesia, Southeast Asia’s biggest economy, President Joko “Jokowi” Widodo said the government was preparing assistance packages to help cushion the negative effect of COVID-19.
“The automatic moratorium is applicable to loans and financing which are not in arrears exceeding 90 days,” Malaysia’s central bank, Bank Negara, said in a letter to bank CEOs and heads of the country’s financial institutions.
The delay in repayment does not apply to credit card balances, the bank said. The new measures, to take effect from April 1, would assist borrowers experiencing financial constraints, including small and medium-sized enterprises (SMEs), it said.
“Banking institutions should provide individuals and SME borrowers with adequate information on how the suspended loan … will be treated during the moratorium period,” Bank Negara said.
More than 18,200 people have died and at least 407,000 others have been infected worldwide, according to the latest data compiled by disease experts at Johns Hopkins University in the United States.
With 106 new cases and one more death reported Tuesday, for a total of 1,624 infections and 15 deaths, Malaysia remained the country with the third-highest caseload in Asia, behind China and South Korea.
Health ministry officials said almost 1,000 of Malaysia’s total cases were connected to a gathering at a mosque near Kuala Lumpur last month. About 16,000 people from more than two dozen countries joined the four-day event organized by the India-headquartered Tablighi Jamaat missionary movement.
At least eight of Malaysia’s coronavirus fatalities were linked to the religious gathering, health ministry officials said.
Neighbors impose economic measures
To limit the pandemic’s swift turn from a health crisis to a financial calamity, Malaysia’s neighbors, including Indonesia and Thailand, have also implemented a raft of economic measures.
Indonesian President Widodo said his government would provide a 10 trillion rupiah (U.S. $607 million) infusion of cash aid to help those who have lost their jobs or daily income as a result of the outbreak. The aid will be delivered through the so-called Pre-Employment Card, he said.
“Every holder of the Pre-Employment Card will be given an incentive of 1 million rupiah ($62) per month for three to four months,” Jokowi told reporters.
The president urged provincial governments to start collecting data on those eligible for the assistance, as he also announced subsidies on basic staples for low-income families, and a temporary waiver on income tax for workers in the manufacturing sector.
The government will also help small and medium-sized businesses by relaxing lending restrictions, Jokowi said.
He said interest on monthly installments would be suspended for a year for app-based taxi drivers who bought their vehicles on credit, and lenders would not be allowed to repossess the vehicles if the debtors were behind on their payments.
Indonesia reported 107 new cases of COVID-19 on Tuesday, bringing the number of confirmed infections to 686, with 55 deaths.
Thai stimulus package
Meanwhile on Tuesday, Thai Deputy Prime Minister Somkid Jatusripitak, announced a stimulus package of about 117 billion baht ($3.5 billion) to help blunt the nation’s economic losses from the pandemic.
About 3 million people without social security funds would each receive 15,000 baht ($458) in handouts over three months and be offered a 10,000-baht ($305) in soft loans, while workers with social security funds would be paid half of their salaries for up to six months, he said.
Small firms will also have access to soft financing, which have lenient terms, such as extended grace periods, officials said.
Earlier this month, the Thai government approved a package of measures, including soft loans for small and medium-sized businesses. Authorities said the move was expected to inject at least 373 billion baht into the economy after the pandemic devastated the nation’s tourism sector.
Bangladesh’s garments sector faces ‘extreme uncertainty’
The pandemic’s impact has hit Bangladesh’s all-important garment industry especially hard.
As many as 843 factories reported that 697 million pieces of orders, valued at $2.2 billion, had been cancelled, authorities said.
Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said the scrapped orders would impact about 1.4 million workers in the sector, which is the country’s top foreign currency earner.
“We are going through extreme uncertainty,” Huq said in a video message to the association’s members.
Bangladesh, the world’s biggest garment exporter after China, has only reported 39 coronavirus infections with four deaths as of Tuesday, but the ready-made garment industry accounts for about 13 percent of the nation’s Gross Domestic Product (GDP).
Huq said she had asked the German government to urge its buyers to continue using Bangladesh as their source for ready-made garments.
She said she made the request in a letter sent to Gerd Müller, Germany’s federal minister for economic cooperation, as global buyers kept cancelling or suspending shipments of garments.
“Let the production go on,” Huq also wrote in a letter to retailers. “I urge you all to kindly steer through this crisis together.”
But on Tuesday, Bangladeshi labor leaders urged factory owners to allow garment workers to take paid holidays to avoid getting infected with the coronavirus.
Dhaka had earlier announced that it would observe a general holiday starting March 26 until April 4, but labor leaders said they expected factories to remain open.
“People around the world are in a panic situation, no doubt about that,” Mahbubur Rahman Ismail, coordinator for the labor group Garment Sramik Odhikar Andolan, told BenarNews.
“The decision of the BGMEA to keep factories open will ultimately push workers towards death, spreading pandemic,” he said.
Hadi Azmi, Nisha David, and Noah Lee in Kuala Lumpur, Ronna Nirmala in Jakarta, Pimuk Rakkanam in Bangkok and Jesmin Papri in Dhaka contributed to this report.