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FMM warns manufacturers may face downturn in first quarter of next year

FMM In The News: BERNAMA, KUALA LUMPUR, Thursday, December 1, 2022 - The manufacturing sector may face a downturn in the first quarter of next year (Q1 2023) due to global uncertainties, said the Federation of Malaysian Manufacturers (FMM). 

Its president Tan Sri Soh Thian Lai has warned industry players to be prepared moving into 2023. 

“The  government  must  take  proactive  actions,  engage  with  the  industry  to  come  up  with  the  right  policies  so  that  small  and  medium  enterprises  (SMEs)  can  go through the headwinds,” he told reporters at the ‘FMM Industry 4.0 Conference 2022 - The Digital Supply Chain’ today. 

He  noted  that  the  International  Monetary  Fund  (IMF)  has  predicted  that  global  growth  will  slow  down  next  year  amid  the  cost  of  living  crisis,  tightening financial conditions, and geopolitical tensions. 

Many countries which depend on trade with the United States, China, Russia, and Ukraine are witnessing reduced trade with the relocation of supply chains and job cuts, he added.

However, he said trade skirmishes and war are not the only factors dragging down the world economy but also the European Union energy crisis, high inflation rate, and the lingering COVID-19 pandemic threat. 

“However, despite all the challenges, Malaysia’s economy is still considered buoyant and unemployment was considerably low.

“Malaysia's  gross  domestic  product  (GDP)  exceeded  expectations  by  expanding  by  14.2  per  cent  in  the  third  quarter  -  the  fastest  GDP  growth  posted  by  any Southeast  Asian  nation  during  the  period,”  he  noted.  “This  highlights  Malaysia’s  resilience  amid  the  challenging  global  environment.  Growth  in  the  manufacturing sector also improved, supported by better performance of domestic-oriented industries.”

Soh also called on the government to build up the 5G infrastructure within five years, reduce the 4G subscription price and set the 5G subscription price. 

“From the FMM point of view, 10 years is too long,” he said, commenting on the government’s announcement that RM15 billion will be invested over a period of 10 years for the implementation of 5G technology throughout the country.

He added that the government must provide a stable 5G network nationwide to support the digitalisation of the economy.

— BERNAMA

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