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Where's the euphoria in our economic upswing?

  • Living expenses of low to middle-income groups have been rising remarkably against modest increases in their incomes, hence the overall depressed consumer sentiment.

Sin Chew Daily

Malaysia's economic performance in 2017 has been particularly impressive. Thanks to the robust domestic demands and double-digit expansion in exports, the country's GDP grew 5.7% during the first half of 2017, and a strong 6.2% in third quarter for a 5.9% expansion in the first nine months of the year, making the 6% full-year growth projection within reach.

The impressive "report card" will help create a "feel good" atmosphere much needed by the government in the run-up to GE14. However, not everyone is feeling the bliss.

Theoretically a strong national economy has positive effects on job prospects, consumerism and improved quality of living of Malaysians, but judging from the market reactions, people in the street do not seem to feel the boost.

Bank Negara governor Muhammad Ibrahim attributed the absence of euphoria to escalating goods prices, concerns about possible layoffs and mounting debt pressure.

Statistics show that the incomes of Malaysians irrespective of race have indeed grown, but there has been a trend of slowing increases in extra monthly household incomes.

Due to the high inflation rates, the living expenses of low to middle-income groups have been rising remarkably against modest increases in their incomes, hence the overall depressed consumer sentiment.

The country's staggering inflationary pressure has mainly stemmed from rising fuel prices which have a direct impact on transportation costs and the prices of food and non-food items.

Malaysian employees can only look forward to single-digit percentage rise in their wages. Although the government has been trying to get the employers to increase their employees' salaries, the effects have been minimal, forcing the government to turn to policy changes to compensate the people against the pressure from rising goods prices, including the minimum wage scheme and BR1M.

The private sector and the government have been engaged in a tug-of-war over the minimum wage scheme while BR1M is only a short-term expedient solution.

The government has repeatedly reminded the public that they should keep upskilling themselves to ensure improved incomes.

It is undeniable that the introduction of GST has left a certain mark on the cost of living of average Malaysians, and the issue has even evolved into a subject of political contention as well as public grievances.

To be fair, the government has not neglected the economic pressure on the shoulders of rakyat. The domestic trade ministry has announced the establishment of a National Cost of Living Action Council by bringing academic and NGO experts to deliberate factors that contribute to the rise in housing, transport, food and other goods prices.

The decision to set up the council is a move in the right direction, but exploring the issues alone will not be enough. It will be more meaningful if the council is adequately empowered to make sure all the resolutions discussed can be put into effective implementation.

This shows that the government really cares about public needs and is willing to make appropriate policy adjustments to mitigate public woes.

Of course, Malaysians themselves must also change their own lifestyles and institute sound financial management and career planning.

 

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