“There is no restart button for exiting the crisis”: Malaysia’s Ex-Finance Minister Daim Zainuddin

Interview conducted by Firoz Abdul Hamid and Jeremiah Capacillo

Read part one and part two of this interview.

PART THREE: Exiting the crisis and getting prepared for the aftermath

Investvine: Countries are starting to reopen their economies after the Covid-19 lockdowns. Naturally, social, public health and economic parameters need to be taken into account in such openings. Singapore, for example, has laid out a three-phase plan. What are the components Malaysia should consider and how?

Daim Zainuddin: The government must take into consideration the inequalities that have been laid bare and exacerbated by the Movement Control Order, or MCO.

We have asked many students and employees to work or study from home, but this is not an equal opportunity for all. I have read about student Veveonah Mosibin, who had to camp out atop a tree for 24 hours to ensure a good WiFi connection in order to take her online exams. I have read about the 44.4 per cent increase in calls to the domestic violence hotline of the Womens’ Aid Organisation during the MCO. And we have all seen how refugees and undocumented migrant workers were rounded up, and those who have not been caught dare not leave their homes for fear of imprisonment.

In reopening the economy, the government must think about how it will address inequality. This pandemic has exposed inequality worldwide. An unequal society is at risk of higher crime rates, lower GDP growth rates, increased political instability, poorer public health and poorer educational attainment.

As we reopen the economy with the new Standard Operating Procedures, we should be asking the question of how accessible are these new procedures? Is everyone getting clear and concise messaging of them? Are they clearly published on relevant government websites? Are they accessible to those without stable Internet, without smartphones? Are enough people aware of and receiving assistance from the government to support their return to normal life?

Take for instance the reopening of schools. Where do teachers start? Some students may have been able to follow their lessons online while others may not have been able to do so. How do you ensure a level playing field for all students? Our schools are overcrowded with sometimes up to 50 students per classroom. How do you get everyone to return to schools when you cannot physically increase the school size? They have talked about splitting classes into two, but where do you get enough hours for teaching and enough manpower to teach?

Even in the case of eateries – bigger and more established eateries will have no problems adhering to the Standard Operating Procedures such as sanitizing their tables and so on, but what about the small roadside stall or the lady selling fruit from the back of a truck? How to you determine the procedures for them? How do you ensure they are able to continue trading without fear of being fined for violating them?

We have also seen many cases where very arbitrary decisions seem to have been made. For instance, nurseries and daycare centers were allowed to reopen some time ago, but kindergartens will only be allowed to do so from July 22. Even then, the associations are complaining that despite the reopening date, the ministry has yet to issue them their relevant Standard Operating Procedures. Then we have physiotherapy centers being allowed to reopen but not reflexology centers? Why? Restaurants are allowed to reopen, but not pubs? Why not, if they can adhere to the procedures?

Any exit plan must be decisive, it must be clear whether it can be implemented, and, most importantly, it must be fair.

There is a view that an effective vaccine against Covid-19 is the “silver bullet” to eliminate the pandemic. However, this will take many months to materialise. Until then, it may not be sustainable to keep the global economy in a continuous lockdown. Various key imperatives can be considered in a Covid-19 exit plan:

• Standard Operating Procedures: There is need for robust protocols and processes for social distancing and sanitisation to combat against the spread of the virus.
• Healthcare: Countries will need adequate supplies of testing kits and protective equipment, as well as ventilators and access to treatments.
• Contact tracing: Robust contact tracing mechanism can serve as a tool for effective disease surveillance and control. Some countries (for example South Korea and China) have moved beyond manual contact-tracing to digital means such as tracing apps, although there are calls for such mechanisms to be supported by appropriate data protection and safeguarding of civil rights.
• Behavioural changes: Importantly, the general public needs to learn to live with Covid-19 by incorporating a new normal in their daily lives. This includes social distancing, hand hygiene and avoiding public gatherings.

How is this government handling the exit strategy from the crisis?

Well, from my answer above, I think more needs to be properly done. I believe the reopening has happened too arbitrarily and too rapidly. In a space of two weeks, we went from not allowing gatherings of more than 20 people to allowing conferences of up to 250 people. There was no proper explanation from the government. At the same time the National Security Council keeps sending the public reminders that they should not take advantage of the loosening of travel restrictions by going back to their hometowns. People are confused. If you are allowing people to travel, why are you then warning them not to travel?

It seems there is no real consultation or discussion within the government. While the senior minister for defense says something at his daily briefing, the reality on the ground is different. So we keep hearing updates and corrections being made to announcements. This has caused a lot of confusion to the point where the people really do not know what the new Standard Operating Procedures are. What we are seeing now is that everyone is just doing as they please on the assumption that the situation is no longer dire. In Kuala Lumpur, traffic jams are back and everything seems normal. Will we get a second wave? I do not know, but it is a possibility that the government needs to be prepared for.

Given how businesses in both developed and developing countries have struggled through this crisis, do you think they are generally well equipped for crises? How should the entire concept of business continuity plans look like, moving forward? Would you recommend any long-term structural changes in the government and in government-linked companies so that they are better equipped to deal with a similar situation in the future?

I think that most businesses are now getting used to the idea of remote working, while most industries have reduced physical contact where possible. Even some government agencies are allowing flexibility for their staff to work from home at least for one or two days a week.

This is not just about Covid-19, but also for uncertainties and crises in general. Businesses must have a clear sense of their priorities, of which employee welfare and safety must be one.

Many businesses formed a Covid-19 War Room of sorts to tackle the current crisis, and such a group of key decision makers in every company must continue to monitor and plan for the future. As of now, the immediate challenge is to continue working with reduced physical interaction. Businesses must therefore have comprehensive plans on how to tackle these problems – ensuring all employees have internet access even at home, have sufficient welfare support considering the mental strain that comes with working under a pandemic and ensuring the business has sufficient reserves to weather a potential second lockdown.

For those who are reliant on cheap foreign labour, and most likely have now lost access to that, what are the long-term plans? Will they automate these processes, or try to recruit local staff who are willing to work for low wages?

Those at the top must ensure that longer-term planning is still taking place as a financial crisis may be on its way. There is no magical “restart” button that makes everything go back to normal when Malaysia becomes Covid-19 free. Let’s not forget that businesses have closed, people have lost their jobs, foreign tourists will not come flooding back in such numbers as before and so quickly. So we are in for the long haul. It is not merely about weathering a short-term storm; this is a long-drawn hurricane that we are facing.

The government too, on its part, has to think long-term. How does it sustain revenue? How does it prolong some of the welfare measures taken? How does it plan for job creation? How does it sustain the very large civil service? Covid-19 could very well be the turning point for how the Malaysian government and civil service plan their own future and for the future of the nation.

As a close friend and confidante of ex-prime minister Mahathir Mohamad, how do you think would he and the Pakatan Harapan government have handled the Covid-19 crisis if he was still at the helm? Would he have done anything differently?

First of all, I have retired from both business and politics. Like other citizens we observe and express our views.

That said, it is very difficult to say what he would have done. Safe to say that Mahathir Mohamad has vast experience in handling all sorts of crises, and being a medical doctor himself, he would also know the protocols that would be required in handling a health crisis.

I believe he would have done a lot of things differently. Definitely there would have been greater consultation and interaction with the industry as a whole, interest groups and the media. There would have been better coordination and synchronisation between ministries because the Pakatan Harapan government was already two years old and had already started to function as a single entity.

The trait that stands out about Mahathir Mohamad is his far-sightedness. As I mentioned before, what we are seeing now is not a short-term storm, but a drawn out hurricane, a black swan event. The need to think ahead – many steps ahead – becomes an important asset for the leader of a country.

The interview ends here.