Government urged to table Covid-19 bill to save retail, services and
manufacturing sectors
By Kalbana Perimbanayagam - April
29, 2020
KUALA
LUMPUR: A coalition of Malaysian business associations is calling for an urgent
enactment of a Covid-19 Act.
The
group of more than 10 associations said the Act should be put in place as a
temporary measure until December to avoid legal disputes over contractual
obligations in the post-Movement Control Order (MCO) period.
They
said the Covid-19 Bill is crucial because more than 40 per cent of businesses
in the retail and services sectors will not survive the financial impact
brought about by losses and the high stakes involved in rental, salaries and
other contractual commitments.
The
bill, when enacted will protect these sectors against collapse, they said. The
coalition urged the Malaysian government to emulate similar enactments of Covid
19 Acts in Singapore and the United Kingdom.
The
coalition comprises entities such as the Asean Retail-Chains & Franchise
Federation (ARFF), Branding Association of Malaysia (BAM), Bumiputra Retailers
Organisation (BRO), Federation of Malaysian Fashion, Textile and Apparel
(FMFTA), Malaysia Budget Hotel Association (Mybha), Malaysia Digital Chamber of
Commerce (MDCC), Malaysia Hair Dressing Association (MHA), Malaysia Retail
Association (MRA), Malaysia Retail Chain Association (MRCA), Persatuan Usahawan
Maju Malaysia (PUMM) and SME Association of Malaysia (SME Malaysia).
MRCA president, Datuk Seri Garry Chua said it was the
first time in history that various Malaysian business associations banded
together to appeal for help for 30,000 businesses.
He
said the effort will ultimately help to save three million jobs in the country.
"It
is of paramount importance for a Covid-19 Bill/Act, similar to the Singapore
Covid- 19 (Temporary Measures) Act to be put in place to protect business
owners from legal suits when they are unable to fulfill their contractual
obligations or sustain their businesses post-MCO.
"The
act is necessary to enable businesses to receive temporary relief as many
business owners will be unable to fulfil their contractual obligations leading
to disputes and legal actions against one another.
"We
implore the government to consider implementing a Malaysian version of the
Covid-19 Act, which is temporary and retrospectively effective from the start
of the MCO on March 18 till the end of the year," said Chua via a live
e-Conferencing platform today.
He said businesses in the retail, manufacturing and
service sectors have contractual commitments; and a temporary act could avoid
unnecessary trouble for everyone if the act is spelt out correctly.
He
said such legislation will prevent certain legal actions to be taken between
counter parties and their guarantors, if the inability of that counter party to
perform such contracts is related to the Covid-19 pandemic.
"The
bill should also extend to the supply of construction materials, performance of
private corporate bonds, performance of provision of goods and services for
events, performance of goods and services related to tourism, performance of private
hire purchase related to factoring service providers and repossession of goods
used for the purpose of trade and business," Chua said.
Meanwhile,
MRA president James Loke said the legislation was important to combat the
adverse effects of the Covid-19 pandemic on the nation's businesses. He said
the act would protect the present job market.
"The
retail and franchise industries and related businesses are facing unprecedented
uncertainties due to the ongoing MCO. It has brought big losses to businesses
and workers are being laid off.
"Many retailers operating at shopping malls and
rented premises are already feeling financial pressure as they have to still
pay their workers' salaries, utilities and rental, despite not having any
business.
"The
act should detail out clauses for rental, other expenses and allow for sharing
of financial burden between owners and tenants of shopping malls, shop lots,
offices and factories, as well as (have details on) reductions in rental.
"You
cannot expect every landlord to be kind enough to understand (a tenant's)
predicament and give a waiver or extension period to pay up " Loke said.
He
said business owners could implore for a Gross Turnover (GTO) Rent to be in
place to tide them through during these challenging times until normalcy is
restored.
"If
this is not favourable, the government should consider an 80 per cent tax
rebate for rental reductions to landlords. The wage subsidy should also be
recapped by the government."
Loke
said the current terms and conditions which sets a 200-employee per company
limit to claim wage subsidy should be removed by the Social Security
Organisation (SOCSO) because all employees, regardless of what sector they work
in pay Employment Insurance System (EIS).
He
said private sector employers must be given the rights to manage their
respective workforces and reign in wage reduction, as the employers see fit.
"Ultimately,
it is the employers who are in in charge of the employee wage welfare."
Loke
said in the next six to 12 months, businesses will be affected by adverse
market conditions and they will not be able to guarantee employment and full
wage.
1.
Outline at least FOUR major issues as described in the article above.
[12 marks]
2.
Suggest ways these parties can help to alleviate the issues faced by retailers:
a.
Retailers themselves
b.
Government
[14 marks]
3.
Forecast the possible impact of COVID-19 on Malaysian retailers should
the pandemic continue to wreak havoc for another year.
[14 marks]
Part B (60 marks) Answer all questions Question 1
Using
examples of goods or services you are familiar with, explain how does
the knowledge of price elasticities helps these two
entities to make pricing decisions.
(a)
A used car dealer
[15 marks]
(b)
A chicken rice shop
[15 marks]
(a)
Using an appropriate example, explain THREE (3)
characteristics of an oligopoly firm in Malaysia.
[15 marks]
(b)
Malaysian Airlines and AirAsia are said to be part of the oligopoly market. Evaluate this statement based on
your knowledge of oligopoly firms.
[15 marks]
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