Japanese manufacturers in Malaysia operate at half capacity after lockdown: survey

27, May. 2020

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KUALA LUMPUR, NNA – More than a quarter of Japanese manufacturers in Malaysia are operating factories at less than half capacity even after an easing of COVID-19 shutdowns, a recent survey found.

The May 12-15 poll by the Japanese Chamber of Trade & Industry Malaysia and the Japan External Trade Organization showed that 27.2 percent of manufacturers are using little capacity mainly because of declining orders from clients.

Half of those manufacturers have had orders withheld, reduced or cancelled, according to the survey of 248 chamber member companies.

Among the nonmanufacturing firms surveyed, 45.7 percent said they were operating at less than half capacity.

Of the total respondents, 138 firms are manufacturers. More than 70 percent of the total are based in the major city Kuala Lumpur and nearby Selangor State.

A third of total respondents said 2020 full-year revenues are likely to drop 50 percent from 2019.

Over 40 percent of the respondents say Malaysian government economic stimulus measures such as wage subsidies and aid from parent companies in Japan have headed off wider financial problems.

After a nearly seven-week shutdown, the Malaysian government eased disease control measures on May 4 to allow most social and economic activities.

Almost all manufacturers have resumed operations, while over 80 percent in the service sector have restarted business, according to the survey.

Looking ahead two years, 58 percent of manufacturers and 70.6 percent of non-manufacturers said they will not change any investment plans made before the COVID-19 outbreak, the survey showed.