SERI KEMBANGAN, April 2 — The geopolitical crisis in West Asia is expected to have long-term economic effects, with the B40 group among the most severely affected.
Economists anticipate that although the conflict involving the United States (US), Israel, and Iran may end in the near future, its impact will not be fully recovered immediately due to disruptions to industrial confidence and global supply chains.
Universiti Putra Malaysia's Putra Business School senior lecturer Prof Dr Ahmed Razman Abdul Latiff said the uncertainty arising from the war is expected to continue exerting pressure on the prices of goods and market stability.
“Although the latest statement from the US President says the war will be stopped within two to three weeks, it does not mean this crisis will simply come to an end or that its impact will disappear just like that.
“I see the impact persisting for perhaps several months because it is not only the war that causes prices of goods to rise, but also industrial confidence — how they will ensure these supply chains are restored,” he told Media Selangor.
Razman added that the effects of the conflict are also being felt domestically, particularly among vulnerable groups.
However, financial assistance measures previously introduced by the government are expected to help ease the pressure of rising living costs.
To this, he commended the government’s efforts to control spending on non-critical projects and strengthen the local economy to ensure positive growth.
“All of this is being done to reduce the significant impact on the people. But if the situation remains pressing, I believe that (proposals for) price control subsidies may become more targeted towards those who truly need them,” Razman said.
Tensions in West Asia have escalated since February 28, when Israel and the US launched attacks on Iran, which Tehran responded to by targeting American interests in Gulf countries.
The situation became more critical when Iran moved to close the Strait of Hormuz, a strategic route that handles nearly one-fifth of the world’s oil supply, thereby increasing concerns over disruptions to global energy supplies.
