PETALING JAYA: Economists have warned of a global recession kicking in if the Covid-19 pandemic lasts beyond June, causing the government, companies and households to go deeper into debt.
However, higher government debt would create additional problems for tax payers in the long term, he said.“No wonder the government is thinking of reintroducing the GST in order to solve its financial problems,” he said, referring to the abolished goods and services tax. “That is when highly indebted firms and individuals realise their mistakes. They will be the ones in danger of going bankrupt. Unfortunately in many cases it is already too late.”Yeah Kim Leng, a professor of economics at Sunway University said the economy would hit a flat line if Covid-19 lasts until the end of April, and turn negative if it goes beyond June.
While tourism will be worst hit, public events such as exhibitions and concerts will also come to a halt. He said the UK and Europe are badly hit due to Covid-19 while China’s economy had hit rock bottom after its lockdown in Wuhan, the centre of the coronavirus epidemic.
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