By Joshua Woo Sze Zeng
The recent reports on the economic wellbeing of Malaysia, trumpeted by the ruling Barisan Nasional (BN), is nothing more than cosmetic. Substantial change is negligible.
The 5.7% GDP growth in the first half of this year and the 23rd position in the World Economic Forum’s (WEF) Global Competitiveness Report 2017-2018 are quoted as evidence of the country’s progress.
These reports by themselves do not represent reality. Worse, they are being exploited to manipulate our actual experience, to convince us that all is well while persistent problems swell.
To get a better grasp of reality, these reports must be read alongside others. One may begin with the rising cost of living.
The average inflation rate for the first six months was 4.1%. Compared with the same period last year (2.6%), this is an increase of 58%.
The estimated rate will be between 3-4% for this year, which is high when compared with that of our neighbours: Singapore (1.1%), Brunei (-0.1%), and Thailand (1.4%).
Hence, inflation is referred to as the fourth most problematic factor for doing business in Malaysia, by the WEF’s Global Competitiveness Report.
The decline in the value of the ringgit is worrying. On Jan 13, 2014, the exchange rate to the US$1 was RM3.26. The same day this year, it was RM4.46.
Following that, the trajectory of our Gross National Income per capita, that reflects the average income per Malaysian, has been badly affected.
Earning less for the same work
The Economic Planning Unit’s The Malaysian Economy in Figures 2017 report states that the average income of US$10,644 in 2014 was reduced to US$9,242 (2015), then to US$9,102 (2016), and is at US$8,906 this year.
That means, without any salary increment, we are on average being paid 16% lesser now for the same amount of work we did three years ago.
Salary increment must be no lesser than 16% over four years to at least be stagnant. If inflation is accounted for, we need more than that.
GDP growth and competitive rank, by themselves, cannot be measures of economic and social wellbeing. Things are not cheaper. Rather, it has become more expensive to live in Malaysia.
Recent polls correspond to these data. Of those surveyed, 56% remarked that their financial situation had worsened, and 86% deemed that the average wage was low.
GDP growth and competitive rank have not been shown to benefit the average Malaysian. There is clearly a huge gap in the system.
The present government has failed to translate productivity growth and competitive edge to the people’s advantage.
Increased production and reduced red tape for foreign investors are not indicative of the public’s increased disposable income and consumption. GDP growth and competitiveness, by themselves, are irrelevant to the local’s standard of living.
Sadly, the ruling government seems contented in mere cosmetics, exhibiting neither innovation nor a serious effort to fix the systemic gap.
Joshua Woo Sze Zeng is a councillor at the Majlis Perbandaran Seberang Perai (MPSP), and Bukit Mertajam DAP Socialist Youth chief.
The views expressed are those of the author and do not necessarily reflect those of FMT.