KUALA LUMPUR: A survey conducted by the American Malaysian Chamber of Commerce (Amcham) revealed that 82 per cent of its member companies in Malaysia have reported significant losses.
It said around one third of respondents have been incurring losses of over RM10 million for every two weeks that restrictions on business activity have been in place.
The survey, which was conducted from April 17-24, 2020, also showed a considerable number of respondents (16 per cent) was heavily invested multinational corporations (MNCs) that have reported losses in excess of RM500 million since the movement control order (MCO) was put in place.
“As a short-term solution to mitigate the pandemic’s impact, the majority of respondents have been looking into cost-cutting measures and adjustments of their long-term business strategy, while devising new standard operating procedures (SOPs) to ensure employees’ safety and well-being during the crisis.
“Despite these challenges, and reflecting the long-term perspective with which American companies invest in Malaysia, the vast majority of employers have been able to avoid laying off staff or implementing mandatory unpaid leave,” it said in a statement yesterday.
Amcham carried out its first comprehensive Covid-19 and MCO Business Impact Survey to better understand how the pandemic and the policy responses of the government have impacted its members’ business activity and investment plans.
It said global companies were re-evaluating their investment plans in response to the pandemic, and half of its survey respondents were expecting to reduce their investment in Malaysia in 2020, with a further 20 per cent feeling that it is too early to comment.
It further said companies were also taking steps to revise their supply chain strategies to ensure future business continuity, and we may see some readjustments such as the movement of sourcing lines or the shifting of test and assembly operations.
A majority of respondents indicated that they worked extensively with local small and medium enterprises (SMEs) to support their operations in Malaysia, and therefore these local businesses may also incur considerable losses if adjustments to the supply chain become necessary.
Besides, the American companies emphasised the need for greater clarity of current policies relating to the MCO so that business activities in various sectors could be restarted as expediently as possible without compromising on safety.
“These unique times also open doors of opportunity and the past few weeks has shown the power of collaboration. Amcham looks forward to continuing our active engagement with the government to find pragmatic solutions.
“Through strong partnerships between Malaysia’s public and private sector, international and local, we can ensure that Malaysia’s dynamic economy proves resilient during these challenging times and is in a strong position to bring about a new prosperity,” Amcham chief executive officer Siobhan Das said.
AMcham’s membership consists primarily of large US multinational companies. A total of 114 respondents took part in the survey during the third phase of the MCO and almost half of the respondents are based in the electrical and electronics and semiconductor industries.
The survey comprised 43 questions to obtain feedback on the impact of Covid-19, as well as the implementation of the MCO on their respective businesses.
This includes issues with regard to operations and supply chain, human resources, and investment outlook. – Bernama