PETALING JAYA: An estimated RM20 billion will be drawn out in the next round of special withdrawals from the retirement accounts of Employees Provident Fund (EPF) members, according to economist Lee Heng Guie.
Lee, who heads the Socio-Economic Research Centre think tank, said the RM20 billion in EPF withdrawals could contribute to 0.5% economic growth and stimulate spending growth by 0.8%, based on Bank Negara Malaysia’s projections.
“This year, economic growth will be between 5.2% to 6.3%, and consumer spending will increase by 9%,” Lee said in a China Press report.
The latest round of special EPF withdrawals was announced by the government last month. It is the fourth round of withdrawals, to help Malaysians tide over from the effects of the Covid-19 pandemic.
Lee said this round will be the final special EPF withdrawal as members may be left with not enough savings in their retirement accounts.
However, with the Hari Raya Aidilfitri celebrations due next month, and the reopening of Malaysia’s borders, there would be an increase in purchasing power, which would raise overall consumer spending.
The special withdrawal of up to RM10,000 is open to EPF contributors aged below 55 who have been affected by the pandemic. The withdrawals can be made throughout April.
EPF members have been able to access up to RM71,000 from their retirement funds through three previous EPF withdrawal programmes, which amounted to RM101 billion.
Following this, EPF said that a total of 6.1 million members, or 48% of its members under the age of 55, now had less than RM10,000 in savings in their retirement funds.
Finance minister Tengku Zafrul Aziz has said EPF might have to sell more of its overseas assets if the government allowed the fourth one-off withdrawal.