FMM in the news: The Star, Wednesday, 21 Aug 2019 KUALA LUMPUR: Business activity was sluggish in the first half of 2019 and manufacturers are bracing for slower growth in the second half, according to a joint survey by the Federation of Malaysian Manufacturers (FMM) and the Malaysian Institute of Economic Research (MIER).
During the H1, general business activity index fell 29 points to 78, the lowest reading for the index since 2012, according to the findings of their latest business conditions survey.
The survey said most (45%) of the respondents reported that activity had declined in the first half of 2019, up from 30% in the second half of 2018 and 32% in the first half of 2018.
The survey also said the local sales index posted a significant decline, falling 16 points from the second half of 2018 to 77 in the first half of 2019 - its lowest level since the second half of 2015.
“The export sales index lost 34 points from the second half of 2018 to an all time low of 73. Not only does this indicate poor export sales, it also suggests that export sales had slowed down more rapidly than local sales in recent months, ” it said on Wednesday.
On the outlook for the second half 2019, FMM president Datuk Soh Thian Lai said respondents are cautiously bracing for slower growth.
“The expected business activity index remained unchanged from the prior period’s 101, with 29% projecting a pick-up in business activity in the second half of 2019, while 28% are anticipating a slowdown instead, ” he said at a press conference on Wednesday.
In conjunction with the tabling of Budget 2020, respondents’ wishlist were mostly tax-related, with a reduction in the corporate tax rate topping the list of proposals, followed by general tax incentives, deductions and relief for the manufacturing sector.
Soh said respondents are hopeful that the corporate tax can be reduced to 20% from 24% currently.