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Be prepared for a new wave of price hikes

  • Price control has always been a major challenge for governments in market economics.

Sin Chew Daily

After the swearing-in ceremony, cabinet ministers and deputy ministers have vowed to work hard to promote the economic development of this country and build a better society for all.

Domestic trade and consumer affairs minister Saifuddin Nasution Ismail said on his first day of work that his primary concern was to address the fast-rising cost issue and he promised to handle this matter as soon as possible in order to fulfill the PH government's pledge to the voters.

Cost of living is one of the most pertinent issues that concern all Malaysians, and minister Saifuddin should be commended for prioritizing this issue that is closest to the hearts of many.

The country's macroscopic economic performance in recent months has been outstanding, but unfortunately not everyone is able to savor the sweet fruit of success.

On the contrary, many have suffered under tremendous pressure due to skyrocketing goods prices, and this is one of the major factors that have contributed to BN's defeat in GE14.

PH pledged in its election manifesto to take necessary measures to alleviate the day-to-day economic burden of Malaysians, and it promptly cut the 6% GST to 0% shortly after putting together a new government after winning the election.

This move has won the applause of many. Although there are still some recalcitrant businesses which are reluctant to bring down their prices following the introduction of 0% GST, there are signs goods prices have indeed moderated in recent weeks, helping to mitigate the economic pressure of the rakyat.

To most Malaysians who are still struggling to make ends meet, the current price level has formed a tremendous pressure upon their shoulders, and the new PH government must adopt more effective measures to reduce their burden.

We are still in a consumer honeymoon period of 0% GST before the SST is introduced. The question is: when this honeymoon period ends in September, many are worried whether the soon-to-be introduced SST will spark yet another round of inflationary pressure.

Such concern is not unfounded. When the previous BN administration implemented the GST several years ago, goods prices shot up instantly, seriously eroding the purchasing power of many.

It is hoped that the PH government will have proper planning and preparation in place before introducing the SST in September so as not to trigger a new wave of price hikes.

Price control has always been a major challenge in market economics. It is therefore imperative that the government make early preparation to prevent price hikes following the SST implementation.

This nevertheless needs the cooperation from all quarters, and the government must hold dialogues with the businesses involved as soon as possible in order to seek a win-win solution.

Widespread public outcry arising from skyrocketing goods prices as a result of GST implementation should serve as a lesson for the government to timely draw up strategies to stabilize goods prices before it gets too late.



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