FACULTY OF ADMINISTRATIVE SCIENCE AND POLICIES STUDY (FSPPP)

BACHELOR OF ADMINISTRATION (AM 228)

INTRODUCTION TO PUBLIC POLICY (ADS 514)

TITTLE:

PENJANA

Prepared By:

1. Nur Alia Azwin Binti Roslee (2020983189)

2. Muhammad Haiqal Hakimi Bin Hairul Amir (2020994929)
3. Muhammad Luqman Hakim Bin Mohd Yusri (2020975471)
4. Nurul Ashikin Binti Abd Rahim (2020969033)
5. Siti Mudzalifah Binti Zulkifflee (2019581965)
6. Nurul Ain Afiqah Binti Anuar (2019527483)

Class:

AM228 4C

Prepared For:

Nasyrah Binti Ahmad

Date of Submission:

10th November 2020

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NO. Content Page No.

1. Front Page i

2. Table of Content ii

3. 1.0 Introduction of PENJANA 1-4

4. 2.0 Government Initiative and Program 5-8

5. 3.0 Challenges Face by Malaysian Government 9 - 12

6. 4.0 Recommendation and Solution 13 - 14

7. 5.0 Comparison and Similarities

5.1 Comparison 15 - 16

5.1 Similarities 16 - 17

8. 6.0 Conclusion 18

9. 7.0 References 19

10. 8.0 Appendices 20 - 24

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1.0 Introduction of PENJANA

Pelan Jana Semula Ekonomi Negara also known as PENJANA is the one of
Malaysia Government initiative to regenerate the economy that effected during
pandemic Covid-19 that globally spread in 2020. PENJANA is a proactive action taking
by the Malaysia Government to protect and support in all aspects including lives and
business that in survival during the pandemic of Covid-19 and at the same time
strengthen the nation’s economy. Malaysia Government recognize the challenges that
faced by the individual and businesses during the pandemic, so that the government
create PENJANA with a lots of programs under this policy to help and support them to
continue in the current situation. PENJANA is short-term economic recovery plan that
introduce by government with slogan “Building the Economy Together”. About 40
initiatives and program that amount RM35 Billion under the PENJANA that introduced
by the government to regenerate and stimulate the national economy. (Yassin, 2020,
p. 5)

During the pandemic of Covid-19, government identified the problems and

challenges faced by the people around the country and taking an approach that
focusing on 6 key steps. The 6 key steps including Resolve, Resilience, Restart,
Recovery, Revitalize and Reform. (Flanders Investment & Trade, 2020) These 6 key
steps are the stages that under the government plan to ensure that our country back
into the better condition and stability in all aspect especially economy and lifestyle like
previous before the global pandemic issue rise. These key steps have been
implemented start from February until now. Malaysia government have started the key
with ‘resolve’ stage in February, ‘resilience’ and ‘restart’ in March and April,
respectively. Government decided to introduce PENJANA in stage ‘Recovery’ which
mean is this stage will start on June until December 2020 before government take
another action to be in the next stage as schedule in January 2021.

On the fourth stage which is ‘Recovery’, PENJANA is the main initiative that
introduced by the government by rolling out many sets of strategies in form of
programs and initiatives. In this stage, government decided to take an aggressive and
holistic action as an approach to Malaysia economy that in bad situation that affected
because of the “lockdown” on early of pandemic of Covid-19 in 2020. Every initiative
that plan by the government mostly focusing on the economy in all aspect including

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individual, Small-medium Enterprise, Corporate or large business and Government
Link Company. To ensure the succession of PENJANA, not only government effort
needed but the people also need to give a hand and cooperate to make sure that all
the initiatives that government introduced can be implement and reach to every people
especially that there are involve in businesses because there are the groups that can
help to regenerate and stimulate the national economy. At the end of the success of
PENJANA, there are three keys thrust that PENJANA focusing to achieve the objective
including Empower People, Propel Businesses and Stimulate the Economy. (Yassin,
2020, p. 4)

The main objective of government introducing PENJANA in June 2020 is to

regenerate and stimulate national economy after affected by the pandemic of Covid-
19. Over 40 of initiatives and programs that government introduced in this plan to
generate the national economy that covered several groups especially Small-medium
Enterprise and large businesses. About RM35 billion spending targeted by the
government to invest through the PENJANA that covered 3 key thrusts that they
identify including Empower People, Propel Businesses and Stimulate the Economy.

Secondly, to improve standard of living of Malaysians especially to them that

affected by the pandemic of Covid-19 also one of the objectives of PENJANA. During
the pandemic, Malaysia stated that the percentage of unemployment increase
because of many companies decided to shut down the business and fire the workers
because they cannot pay the salary. In this plan, government introduced a few a plan
that give a modal to business owner to recruit and pay the employee’s salary without
fired them.

There are three keys thrust that recognize by the government that need to be
focus on implementation of PENJANA including Empower People, Propel Businesses
and Stimulate the Economy. One of the keys thrust is Empower People. Empower
People is where the government aware about the suffer that face by the individuals
that affected by the pandemic of Covid-19. Based on government analysis, they found
that about 2 or more million jobs estimated to be risk by the end of 2020. (Ministry of
Finance, 2020, p. 7) Implementation of PENJANA as a government aims to save the
jobs and promote employment, at the same the it will ensuring people have enough to
live on. Based on this key thrust, government introduced initiatives and programs in

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form of hiring incentives and expanded wages subsidy, reskilling and training and
other to ensure that the worker maintain and upgrade the skill then can contribute to
the economy recover. As an example, the target groups that been listed under the
Empower People including b40 community, students especially in rural area and urban
poor group. Government put a full effort to ensure that everyone have qualification to
be in the initiatives need to be reach so that they have a support to ensure their general
welfare is taken care of.

Secondly, Propel Businesses also one of the keys thrust that government
focusing on this PENJANA. Propel Businesses is a government effort to take a holistic
action as an approach to help businesses including large, SME and micro where they
are impacted during the pandemic of Covid-19. Most of the business especially on
SME and Micro need to take left action by shutting down the business because they
cannot stand during the pandemic. Up to 2 months they unable to operate the
business, so that if affecting their revenues and income stream. After the Movement
Control Order, the government decide to reopen the economy sector but about 60%
have problem to restart the business and 66% of business experienced a drastic drop
in demand, so that they having difficulty to recover the businesses and this bring to
the unemployment issue rise. (Ministry of Finance, 2020, p. 22) By implantation of
PENJANA, government introduce about 14 initiatives to help business industries to
restart the business by giving a financial support and alternative method to increase
the demand on the product. As an example, government act as an assist to any
business that demand for the help regarding to rebuild the business including
campaign and many more.

Lastly, one of the keys thrust that recognize by the government that need to be
focusing on implementation of PENJANA is Stimulate the Economy. Stimulate the
Economy is where that government give a signal to the world that our country are open
for the business after the pandemic of Covid-19 happen in early of 2020 (Ministry of
Finance, 2020, p. 38) Government have seen many opportunities that can be generate
in term of economy even we are need to be in the new norm. government also identify
that the national economy can be regenerate drastically by following the new basis
especially on advancement of technology to running the business. Many first world
country doing their business by online and there on track on producing revenues and
financial stream. Malaysia government act as a channel to find the international

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investor to come to our country to start the business here. This will help our country to
regenerate and at once stimulate the national economy to become at the level as
before the pandemic issue rise. Government also focusing on local business to involve
in PENJANA, so that they can rebuild the business. PENJANA act as assistance and
systematic support to help them adapt and grow in new norm operating landscape. As
an example, Malaysia government introduced Malaysia as Attractive Horizon for
Business as an initiative under the PENJANA to attract the international investor to
come and doing their business in our country.

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2.0 Government Initiative and Program

One of the initiatives from the government under the Short- Term Economic
Recovery Plan (PENJANA). This initiative was introduced to encourage consumer
spending among the Malaysian people. Other than that, ePENJANA also was
introduced to encourage Malaysian people to instil safety practises through
contactless payment for any matter and it can assist the public health especially in
keep track the people through the MySejahtera application. According to Ministry of
Finance Malaysia, around 15 million Malaysians stand to benefit from ePENJANA,
where the government provides RM50 ePENJANA credits, to be used for purchase
through the selected e-Wallets service providers, which are Boost, Grabpay and
Touch ‘n Go e Wallet. (Finance, 2020).

Government decided to allocate about RM750 million as the quantum amount

that will give benefit to 15 million Malaysians in the country and it can be claimed by
the citizen starting from 8.00am on 31 July 2020 to 11.59pm on 24 September 2020.
The money from the ePENJANA cannot be cashed out or transferred to another e-
Wallet and the people that claimed the ePENJANA must be utilised the credits before
30 September 2020. Malaysian people that wants to claim the ePENJANA must fulfil
the criteria needed by the government. Because of that, government had set up the
qualification that must the people follow to apply the initiative. Firstly, the applicant
must be a Malaysian individual. People that was not a Malaysian citizen cannot apply
the ePENJANA. Secondly, the person must be 18 years old and above and also a
registered user of MySejahtera app. Then, the person cannot earn more than
RM100,000 anually. Government decided to use three e-Wallets as the medium to
deliver the Rm50 to the people which are Touch n’ Go e Wallet, Boost and Grabpay
because this three e-wallet have active user around 21 million in the year.

The impact of COVID-19 on the world economy has been devastating and
Malaysia are not excluded from the bad impact because of the COVID-19 crisis. As
we can see, the financial market was collapse and this affected the economy sector.
Because of that, ePENJANA was introduced as one of the initiatives under the Short-
Term Economic Recovery Plan (PENJANA) that will assist the economic growth of the
country. As we can see, government provide RM50 for 15 million Malaysians to

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purchase using the e-wallet. With this, the demand will not decrease, and the
production will continue as usual. When the production is increase, the manufacturer
can create job opportunity and the salary also will encourage the person to spend.
This cycle can lead to the economic growth. If the people stop spending, it will give
bad effects to the economy because the consumer spending makes up more than
70% of the economy. Because of that, the citizen responsible to spend the ePENJANA
credit as it will assist the government to increase the economy during this crisis. Either
in online or physical, it can give a positive impact to the economic recovery and
automatically the objective of the ePENJANA will be achieve.

Secondly. Wage subsidy programme is one of the governments initiatives

under the National Economic Recovery Plan. This programme was performed in June
to the end September 2020. The wage subsidy programme was introduced to promote
employee retention and reduce layoffs by extending the wage subsidy programme.
This are important because the employee and the economic are related and depends
to each other. This programme will give benefit to 2.7 million workers in Malaysia to
keep working during this pandemic COVID-19 without any problems with their
organization. The government allocated about RM 5.3 billion to run this programme.

This programme is a continuous programme from the PRIHATIN economic

stimulus package and was extended for three months under the National Economic
Recovery Plan (PENJANA) AND it was known as PSU 2.0 (PERKESO, 2020). This
programme was leads by SOCSO for Business in Malaysia (PERKESO) and Ministry
of Human Resource Malaysia. The government have set the requirement which the
employer that want to apply must follow the requirement. Firstly, the employer and
their employee must register with SOCSO. If they failed to do that, they cannot apply
the wage subsidy programme. Then, the business sales shows decrease especially
during the Recovery Movement Control Order (RMCO) and the employee wages in
the organization must not earn more than RM4000. This is because government
focusing to B40 people which are the most impacted due to the COVID-19 pandemic.
The employee that earning the wage subsidy programme also cannot be laid off, but
the employer can reduce their working hour with the employee’s agreement. For a
new applicant, the employee of the organization will receive RM600 per month for six
month and the current Wage subsidy programme’s recipients will only receive RM600
per month for three months. According to YB Tengku Dato ‘ Sri Zafrul, Minister of

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Finance stated in the 26th LAKSANA report, about RM11.996 billion in wage subsidies
has been approved that give benefit over 322,134 employers as well as over 2.6 million
employees (Zafrul, 2020).

This COVID-19 pandemic has given bad impacts to the economy sector to run
their activities. Many businesses cannot run their activities and affected their business
sales and some of them had to stop their operation. With the wage subsidiary
programme, the employer can run their business without any salary payment issues
because the government have assisted them with the programme. The employer can
maintain their productivity and avoid the issues of layoffs and also at the same time
assist the economic recovery. This are important for the country to reduce the
unemployment and to prevent the investment from the investor decreases in the year
as it will give bad effects in the future.

Thirdly, Tourism sector support is the one of government initiative under the Pelan
Jana Semula Ekonomi Negara (PENJANA) that government introduced to regenerate
the national economy. The reason of government introduced this initiative is to support
the tourism sector during the pandemic of Covid019 period through tax incentives.
Tourism is the sector that faced major impact during the pandemic because this sector
is totally shut down and cannot operate especially during early of pandemic period.
Government also announced that Malaysia border is close until the end of 2020, so
that there are no more movement from inside and outside country except movement
with government approval for emergency and important matter and government
initiatives to bring back Malaysian that work or study outside country during the
pandemic-covid-19.

Based on the government announcement about this initiative, government

decided to allocate about RM 1.8 billion that to be divided into several small program
under this initiative. Government decided to allocate to the people who is qualified to
this initiative start from July until the next announcement onward. Based on
government announcement, government focusing to give this allocation to all people
and businesses that involve in tourism including several beneficiary groups such as
workers, businesses that located at tourism place, tourism agencies, hotels and
restaurants at tourism area and others. All the beneficiary groups that listed by the
government a faced major impact during the pandemic of Covid-19. Most of the

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businesses cannot be operate and no tourism activity occur during the pandemic. In
other view, many of workers that work in this area have been fired because the
company unable to pay the salary. Most of businesses have problem with the financial
steam during this pandemic period.

Tourism sector support is the initiative that government introduce under

PENJANA that focusing on giving tax incentives for the tourism sector. There are
several tourism tax incentives that government allocate under this initiative including
tourism tax exemption, extension of service tax exemption and tax relief of RM1000
for tourism expanses. Tourism tax exemption that government introduced is start from
the 1st of July 2020 until end of June 2021. Government also announce that extension
of service tax exemption for hotel until end of June 2021. The latest announcement
regarding Tourist sector support initiative, government announced new tax incentive
which is extension of period of deferment of tax installment payment for tourism
industry until the end of 2020. All business including micro and SME business that
located at tourism area have extension from tax, this is because this industry still
cannot receive any income even the industry slowly reopens after the pandemic. They
cannot gain income even government give an approval to start operation of the
business because tourist from inside and outside the country loss of interest to come
to the tourist area and cautiously toward the spread of Covid-19 virus.

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3.0 Challenges face by Malaysia Government

The spread of Covid-19 has been a global social and economic challenge.
Malaysia will not escape the insufficient financial crisis. Then, to overcome the Covid-
19 crisis, the government has made a strategy when Malaysia enter the stage of
Recovery, economic recovery plan known as the National Economic Regeneration
Plan (PENJANA) to be introduced by the government. Then, there are some
challenges faced by the government while operating (PENJANA) for Malaysians.

One of the challenges faced by the government while operating (PENJANA) for
Malaysians is that the government cannot provide the people in large numbers due to
economic problems faced by the country. So, from that, the government cannot fully
meet the needs of the people because the government has invested large sums of
money for other needs as well as for Malaysians.

In addition, the economy is also dealing with the problem of "limited resources"
unlimited will. It can be seen that the government is not able to satisfy all the people
due to the deteriorating economic problems. So, the government unable to satisfy the
people. Then, the people must use the money in the right way and be frugal for
important uses.

For example, the government is doing the initiative, which is to create e-

PENJANA program for the people. So, one of creating such a program can reduce
their burden and help the people to buy necessities. Moreover, the government cannot
give the people in a huge amount because the government invests a lot of money into
other programs as well. Therefore, government money is limited to be invested in all
citizens.

The government has a responsibility to protect the financial problem borne by

the people as well as the people have a responsibility to use the money given by the
government frugally. Next, PENJANA is a much-needed impetus to restore the
people's income, lifestyle and provide assistance for us to overcome current
challenges and look firmly into the future and be able to ease the burden of the people.

Next obstacle that face by the government in conducting the “NATIONAL

ECONOMIC REGENARATION PLAN (PENJANA)”. As what can we see, covid-19
virus has spread rapidly beyond what we expected. So, during this pandemic most of

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the citizen had lost their source of income, job and others. This plan been introduced
by the government as one of the initiatives to help the citizen and ease the citizen’s
burden.

Through this National Economic Regeneration Plan (PENJANA), government

has introduced 40 initiative under it which can support the economic recover faster
while the effect is expected to be seen as early as the third and fourth quarters of this
year. All of the 40 initiative under National Economic Regeneration Plan (PENJANA)
which cost RM35 billion where been divide into several group which are empower
people, propel business, and stimulate the economy (Bernama, n.d.).

From all the initiative government had giving so much to the people in order
helping them continuing their life especially during this outbreak. PENJANA and “Pakej
Rangsangan Ekonomi Prihatin Rakyat (PRIHATIN) that cost most RM295 billion,
direct fiscal injection from the government cost RM45 billion which RM35 billion for
PRIHATIN and RM10 billion for PENJANA. So, it cause the increasing of the national
deficit which from 5.8% to 6.0% compared 3.4% that be recorded last year (Teks
Ucapan Perdana Menteri Pelan Jana Semula Ekonomi Negara , 2020)

This is not only the national deficit could be increasing the country debt also
could be increase if the amount of the subsidies been increase from time to time. This
is because when the country does not have enough money to give to the citizen the
government will borrow from the world bank to top up the lease amount, they have in
order to help the citizen.

In Malaysia’s history be proven in reducing the national deficit during 2009

which the national deficit reached to 6.7% and after several years, government
managed to reduce it to a level over 3.0%. This is because of the commitment given
by all the people who get involved, finally government could manage in reducing the
national deficit. (Aziz, 2020)

This could be one of the challenges faces by the government in conducting

PENJANA during this outbreak but with everyone commitment finally it could help in
reducing the national deficit from time to time.

PENJANA outlines a short-term recovery plan, based on sessions involving

engagement and engagement more than 100 stakeholders comprising both public and

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private sectors. By collectively, a total of 40 initiatives worth more than RM35 billion
have been set up. The government has also made step by step to apply for any
assistance but there are also people who do not follow the conditions set by the
government. This is because the government provides conditions so that the people
are not confused and get the right info to apply for any assistance.

The people do not cooperate with the government where they do not follow the
instructions set by the government which is where they have to apply according to
age, but some do not follow the rules. So, this will cause the government not to get
the right information about the people to collect the data.

The government has difficulty in getting information from the people. This causes the
government to not be able to collect clear data for later use. For example, anyone who
has an SSM certificate, they are eligible to receive RM3000 but those who do not
follow the conditions to apply for RM3000 is incorrect because they have the SSM
certificate but do not follow the conditions set by the government. So, this will cause
the people not to get the right info to apply for the assistance.

In addition, based on what have happen around us we can see some of the
people are not satisfied with government decision where they are not eligible to accept
one of PENJANA initiative which is under PRIHATIN. This problem are from the
government itself, they are not getting the updated information about the people
income until they misinterpret their income and categorized them as M40 meanwhile
they fall into B40 group or that people are eligible to get the “Bantuan PRIHATIN” but
turnout are not eligible. Government should play as the biggest role at here to really
measure the people income to be fair and square in conducting PRIHATIN towards
the citizen.

Furthermore, in term of tourism sector PENJANA has giving the opportunities

to free from the tourism taxation, extension of service tax exemption and extension of
individual income tax. In here, it could be the government misinterpret the company or
the company itself manipulated their data in order to get free from any taxation. For
example, their location of the hotel are not located in tourism places but because
government has introduced this, so they want to get the opportunities by saying their
places are located near the tourism places which get affected because of the
pandemic of covid-19. So that, the government must really check on every detail of

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the information giving by the company and the company also should realize that they
are not eligible to be part of the company who are supposedly get the free taxation.

In conclusion, government and citizen itself should play their big role as the
responsible people to apply one of the initiatives under PENJANA. If you belong to
ineligible group, then you are not supposed to apply it because of your application
government may be misinterpret the data given and accidently giving it you. In order
to avoid this type of challenges government should really measure the source,
information, so that the initiative is fall to the right people.

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4.0 Recommendation and Solution

Firstly, Malaysian government give the initiative only stage by stage since the
government cannot afford for a huge amount of money to give towards people.
Malaysian government give incentives for employers by RM 600 for three months. So,
government stated that the wage subsidy starts from April 2020 until June 2020 and
extended it to Wage Subsidy Program 2.0 from July 2020 until September 2020. This
proved that government cannot give a huge amount of money for people due to
economy crisis face by Malaysian country. Government implement National Economic
Recovery Plan (PENJANA) for economic recovery by focusing on domestic growth.
This showed that government cannot afford to give a huge amount of incentives
towards all employers around the country since the national debt increase. Based on
the article by New Straits Times, “Wage subsidy buys bosses more time” stated that
the WSP is a short-term solution. Wage subsidy purpose is for employers retain their
workers as their business cannot being run due to Movement Control Order (MCO).
This is related to the overhead cost that could be minimal. The first phase of WSP,
basically to reduce the financial burden of employers and employee. This is to relief
all the affected employers during the pandemic Covid-19.

In addition, the government offered the Wage Subsidy 2.0 which is under
Prihatin Supplementary Initiative Package (Kita Prihatin). The government extended
the wages subsidy for business recovery their economy. The government extended it
until the end of year 2020, in terms to lower projected domestic and export sales. This
stimulus is to help medium enterprises (SMEs) to overcome the cash flow constraints
by meet a fixed capital cost. So, under Kita Prihatin, all affected employers managed
to relief a little bit of their financial problem. As the government reduce the people lose
their jobs it also could help to boost the economy recovery in the future.

Secondly, the solution that could government do is by interest and principal fees
so it could decrease the national deficit and maintain nation’s Gross Domestic Product
(GDP). Basically, government needs to pay interest fees within period and continues
with principal fees. As the government implement the PENJANA, the national deficit
will increase compared to last year. As the deficit of the country increase, the national
debt also increases. Based on the Finance Minister, stated that the national deficit will
be doubled than before as the government implement the PENJANA. It is stated that

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fiscal deficit will increase to 5.8% to 6% in early June 2020. When country spent more
than they received it will lead to the deficit to happen. According to the Ministry of
Finance stated that Malaysia have RM 823.8 billion its current debt and still within
nation’s GDP which is 53.6%. The national debt will affect Malaysian policy, future and
economy in the future. Government need to roll out economic stimulus to help
managed the global pandemic and unstable economy. For example, if our country has
20 years contract to pays the debt then the country needs to pay within 20 years and
after that country could pay all principal fees. If the country fails to pay lump sum all
the amount, then the country needs to rollover. Rollover means that create a new debt
to pay the old debt. As the process rollover going, the country’s economy also needs
to keep on progress and growth. Basically, Malaysian’s country does not have a huge
difference on national deficit as the GDP is maintain on 51% to 53% within these four
years.

Thirdly, Malaysian needs to improve their procedures regarding initiative that

has being offered in PENJANA. So, that it would ease all applicant to proceed the
documentation or the requirements. Basically, procedures are an official process of
doing something. Basically, all initiative that has been offered in the PENJANA has a
procedure or a requirement that people needs to fulfill. The government set up and
provide a condition regarding initiative in PENJANA. As government give initiative
under PENJANA, they need to ensure that all receiver was qualified and follow all
requirement to apply the initiative. The government were focusing on people who most
affected during this pandemic Covid-19. For example, ePenjana one of the initiatives
under PENJANA. People who wants to receive the initiative of RM50 either must have
an application of Touch n Go ewallet, Boost or GrabPay. People also needs to have
MySejahtera application to proceed with other requirements. The requirements for
claim the RM50 is must be age of 18 and above, also income must be less than RM100
000 that has been declared to Lembaga Hasil Dalam Negeri Malaysia (LHDN). After
verifying all personal information in the ewallet also identification document such as
MyKad. Then, applicant needs to wait for three days to receive it as the government
seen all applicant details. So, basically government could improve the time taken they
take for verifying the applicant’s information. By then it could increase the process and
ease the applicant process.

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5.0 Comparison and Similarities
5.1 Comparison
One of the differences between PENJANA with the others country is PENJANA
covers all aspects for the people in the country. There are three key thrust that the
government use to run PENJANA which are Empower People, Propel Business and
lastly is Stimulate the Economy. With this, the initiative takes into account the
individual, SME, micro and large and no one missed from the PENJANA programme.
It shows that the government not only focusing to the single entity but all people in the
country to recover the economy together. Some countries decided to focus to only one
issues, and this will give a negative effect to the side. For example, Armenia stimulus
package only focusing on SME and firms only. According to International Monetary
Fund website stated that the measures fall into three broad categories which are
subsidized 2-3 year loans to provide short term support to affected businesses and
SME, direct subsidies to SMEs and businesses to help maintain their employees and
grants to entrepreneurs and firms. (Fund, 2020).

The second differences between PENJANA and some other countries is

PENJANA providing direct subsidies and loans to the people. This are important to
assist the SME’s or firm that adversely impacted by COVID-19 in order to sustain
business operation. With that, it also automatically will assist the government to
recover the economic because the production is run smoothly. Wage Subsidy
Programme is one of the examples of the direct subsidies and PENJANA SME
financing (PSF) is the example of the loan that have being provided by the government
during the covid-19 pandemic. For another countries, some of them decided to only
provide loans to SME or firms. The example of the country that only providing loans to
SME or firms is Argentina. Argentina has located about ARS700 billion stimulus
package as their initiative to recover the economy and also sustain the economic
activity. Other than that, the stimulus package also aimed to avert shortages of medical
and food, protect workers from being layoffs and also help the companies to run their
businesses. The government focusing on six issues and one of them is credit
guarantees for bank lending to micro, small and SME for the basic supplies and
production of food. The stimulus package does not have a direct subsidy to the
businesses, but they can lend a loan from the banks. According to the International
Monetary Fund Official Website stated that measures have been aimed at

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encouraging bank lending through lower reserve requirements on bank lending to
households and SME (Fund, 2020).

5.2 Similarities
In 2020, the world has affected by the Pandemic Covid-19 widely. The
country needs to face a lot of problem specially to maintain the country well-being.
Every country needs to construct and introduce several temporary short-term policies
to reserve the stability of the country in many aspects especially economy, education
and health. European Union are the one of the country coalition including 27 members
that faced huge impact during the pandemic of Covid-19. European Union also take
several initiatives to help their euro area especially on economy to ensure the stability
of economy. There are several similarities between PENJANA that introduced by
Malaysia government and European union which is Pandemic Emergency Purchase
Program to cope the problem during the pandemic of covid-19.

One of the similarities of European Union initiative and PENJANA introduced

by Malaysia Government is to ensure the financial viability of as many firms as
possible. (Kirkegaard, 2020, p. 2) Both governments decided to channel some
allocation to the firms and businesses inside the country to maintain the operation of
the business. European Union decided to offer varying degrees of credit guarantees
to national firm as a temporarily protection of the business to cope with the financial
stress that the business faced during the pandemic of Covid-19. (Kirkegaard, 2020)
EU government provided a temporarily subsidy to the firms as an initiative to avoid the
business going bankrupt. In other part, Malaysia Government also introduced an
initiative for help the stability of the business especially for SME including PENJANA
SME Financing (PSF) where the government channel the allocation about RM 2 billion
of funding through banking sector as an assistance to SME that impacted by the
pandemic of Covid-19. (Ministry of Finance Malaysia, 2020, p. 27) The initiative
introduce will help the businesses of both countries to cover the dept and expanses of
the business that cannot be settle because of income reduce especially during the
implementation of lockdown on early of pandemic period. This both initiatives taken by
EU government and Malaysia government not only for giving help and assistance to
businesses, so that they can maintain the operation business and not going to
bankrupt because of the pandemic. Therefore, both initiative including giving some
allocation by the EU government under PEPP and PENJANA introduced by Malaysia

16
government have similarities in order to help businesses and firms to maintain the
operation of the business.

Lastly, Malaysia government and EU government also decided to introduce and

initiative to maintain the worker’s existing employment relation during the pandemic.
Both governments decided to construct some allocation that channel directly to the
businesses firm in term of wage subsidization to assist them in labor cost during the
pandemic of Covid-19. EU government provided 80 to 90 percent of wage
subsidization under the PEPP as initiative to help businesses to maintain the
employment as well as to manage the unemployment rate especially during lockdown
period. Same goes to Malaysia government, this government also introduced Wage
Subsidy Programme under PENJANA to help people who is affected by the pandemic
especially after the lockdown period end. In Malaysia, many businesses decided to
instructing employees to take unpaid leave after the lockdown order. To ensure the
stability of financial of individual, government decided to give the wage subsidy, so
that they still get pay by the employer even they need to take unpaid leave. Therefore,
there are similarities between PEPP by EU government and PENJANA by Malaysia
government in order to manage unemployment during the pandemic Covid-19.

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6.0 Conclusion

Covid-19 has given a big impact to all nation around the world. All organization
has affected, especially health and economy. These two has a big effect on how to
reduce the people that has being affected and how the world economy needs to
recover. As the Malaysian has being attack by this pandemic, the government need to
improve and introduced new law and regulations. The law and regulation are for the
government have a procedure to handle during the Covid-19. This report focusing on
PENJANA, the initiative that has been proposed by the government to help Malaysian
people. There are many programs under the PENJANA, such as e-PENJANA, Wage
Subsidy Programme (WSP), PENJANA Tourism Financing (PTF) and more. All
program is to give an initiative and benefit for people that been affected during the
Movement Control Order (MCO). Other countries also make an action to help their
people with comparison as PENJANA. PENJANA and their programs could be a
challenge for the country as they need to maintain national economy. Even though the
government has challenge to implement all the policy they also need to prepare a
solution, so that they could handle in the future.

18
7.0 Reference

Aziz, M. A. (2020, jun 11). Ekonomi negara pulih lebih pantas dengan PENJANA. Retrieved from
Berita Harian Online :
https://www.bharian.com.my/berita/nasional/2020/06/699190/ekonomi-negara-pulih-
lebih-pantas-dengan-penjana-tengku-zafrul

Bernama. (n.d.). Retrieved from TheMalaysianReserve :

https://themalaysianreserve.com/2020/06/05/list-of-40-initiatives-under-penjana/

Finance, M. o. (2020). 9. Retrieved from PENJANA: penjana.treasury.gov.my

Flanders Investment & Trade. (2020, September 12). CORONA VIRUS – The situation in Malaysia.
Retrieved from Flander Trade:
https://www.flandersinvestmentandtrade.com/export/nieuws/corona-virus-%E2%80%93-
situation-malaysia

Fund, I. M. (2020, October 24). Policy Responses to COVID-19. Retrieved from imf.org/en/Topics/imf-
and-covid19/Policy-Responses-to-COVID-19

Kirkegaard, J. F. (2020). The Macroeconomic Policy Response in the EU and Euro Area. The European
Policy Response to the Covid-19 Pandemic, 3.

Ministry of Finance. (2020). Pelan Jana Semula Ekonomi Negara. Building The Economy Together, 7.

Ministry of Finance Malaysia. (2020). Pelan Jana Semua Ekonomi Negara. Building The Economy
Together, 27.

PERKESO. (2020, september 25). Wage Subsidy Program 2.0. Retrieved from perkeso.gov.my

Teks Ucapan Perdana Menteri Pelan Jana Semula Ekonomi Negara . (2020). TEKS UCAPAN, 5.

Yassin, M. (2020, June 5). Teks Perutusan YAB PM-PENJANA. Retrieved from PENJANA - Pelan Jana
Semula Ekonomi Negara: https://penjana.treasury.gov.my/pdf/Teks-Ucapan-PM-Pelan-Jana-
Semula-Ekonomi-Negara-PENJANA.pdf

Zafrul, T. D. (2020). 26th LAKSANA REPORT.

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8.0 Appendices

Appendix 1.0: Pelan Jana Ekonomi Semula Booklet by Ministry of Finance

Appendix 2.0: News on “List of 40 Initiatives under PENJANA” reported by The

Malaysian Reserve

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Appendix 3.0: Speech text of Malaysia Prime Minister on announcement of
PENJANA

Appendix 4.0: News reported by Flanders Trade on “CORONA VIRUS – The

Situation in Malaysia”

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Appendix 5.0: Report on “The European Policy Response to the Covid-19 Pandemic”
reported by Jacob Funk Kirkegaard

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