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KUALA LUMPUR, Nov 17 -- Budget 2021 could be improved by increasing its focus on critical areas which are key to the country's economic recovery, says Asia Pacific Investment Bank (APIB).
Chief executive officer Chris Wang said the lack of allocation for cutting-edge technology infrastructure spending in the budget would curb the swift adoption of the fifth-generation mobile network (5G), artificial intelligence (AI), big data and other internet technologies, among others.
“It is great that Budget 2021 provides for an allocation of RM1 billion as a special incentive package for high value-added technology, in addition to Bank Negara Malaysia’s High Technology Fund worth RM500 million to support high-tech, innovative companies.
“However, almost zero allocation is made to build infrastructures that will further enable the implementation of new technologies," he said in a statement today.
Wang said new tax incentives for the establishment of a “global trading centre” at a concession rate of 10 per cent for five years would not be strong enough to support local companies to expand globally.
"This is especially so in light of the recent signing of the Regional Comprehensive Economic Partnership (RCEP) between 10 ASEAN countries and Australia, China, Japan, South Korea and New Zealand.
“Malaysia will soon usher in a more open and competitive market, hence government support for trading companies, especially small and medium enterprises, is urgent,” he said.
Additionally, Wang said Budget 2021 could have also considered further reducing institutional transaction costs, including banks providing a further extension of credit and interest subsidies to businesses to ease their cash flow pressure.