The Impact of Covid-19 on Malaysian Edible Birdnest (EBN) Industry

Muhammad Majid,Basri Badyalina,Mohanad Faizal Ramli,Fatin Farazh Ya'Acob,Mohamad Zaim Isamail,Nur Fatihah Shaari,Nurkhairany Amyra Mokhtar

doi:10.6007/ijarbss/v11-i12/11756

Muhammad Majid, Basri Badyalina + Show 5 more

Open Access

https://doi.org/10.6007/ijarbss/v11-i12/11756

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Abstract

The swiftlet industry is listed under 12 Entry Point Projects (EPP) under the Agriculture NKEA which is one of the cores of Economic Transformation Programme (ETP) as it can generate income for the nation. Although swiftlet ranching business or activities is a minor player compared to other establish business, it significant in their own way. They have contributed to exports and created a fair amount of employment. However, the pandemic Covid-19 outbreak has taken a toll on many sectors and industry players, inducing rising concerns nationwide over the country’s economic outlook. The Movement Control Order (MCO), which is enforced until year 2021, will also dampen domestic economic activity. The primary objective of this study is to use the Vector Autoregressive (VAR) model to determine the influence of Covid-19 on EBN export in Malaysia. The purpose of this study is to ascertain the influence of newly confirmed and fatal COVID-19 cases on EBN export in Malaysia. Granger causality analysis indicates a unidirectional causal relationship between EBN export (EBN) and coronavirus new cases (CNNCC) and coronavirus fatal cases (CNFC). According to the VAR data, confirmed coronavirus cases have a negative and significant effect on EBN export in Malaysia. This indicates that information on coronavirus positive cases is inversely correlated with EBN export. However, coronavirus fatal cases have a beneficial influence on EBN export, but the effect is statistically insignificant.

Highlights

The swiftlet ranching is firmly anchored on its potential for lucrative returns
The primary objective of this study is to use the Vector Autoregressive (VAR) model to determine the influence of Covid-19 on edible birdnest (EBN) export in Malaysia
According to the VAR data, confirmed coronavirus cases have a negative and significant effect on EBN export in Malaysia. This indicates that information on coronavirus positive cases is inversely correlated with EBN export

Summary

Introduction

The swiftlet ranching is firmly anchored on its potential for lucrative returns. The growing demand is derived especially from the rising affluence of Mainland Chinese and the worldwide trend of pharmaceutical and herbal products companies in using edible birdnest (EBN) as base materials for producing natural and organic extracts and products (Merican, 2007). Realizing the prospects of swiftlet ranching, the Malaysian government in 2010 has designated it as a high-growth sub-sector in the agriculture National Key Economic Area (NKEA). This activity has been earmarked as an Entry Point Project (EPP) under the Economic Transformation Programme (ETP) announced in late 2010 with the aim to turn it into an agrobusiness to serve the export market and to create a viable form of livelihood. In the middle of 2011, an embargo from China caused a sharp decline in the Malaysian EBN export This led to decrease in export by 13.98 percent from 145.8 metric tons (2011) to 125.42 metric tons (2012). With the above bear in mind, this study wants to investigate at the impact of Covid-19 to the trade of Malaysian EBN

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