Malaysians Are Poorer and Hugely Indebted

A Kadir Jasin

THESE bad Malaysians, all they do is groaning and moaning about GST?

They are making Prime Minister, (Datuk Seri Mappadulung Daeng Mattimung Karaeng Sanrobone), Mohd Najib Abdul Razak, looks bad.

Bad people. They’re making up stories about the GST forcing up prices and the cheap ringgit impoverishing the rakyat.

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They should stop reading rubbish in the blogs and social media and start reading some quality news in the New Straits Times (NST).

On April 22, the paper published a story bearing the headline “As Malaysians complain about GST, Porsches, Benzes and Jaguars fly out showroom doors.”

Surely it wasn’t lying. In the report, it says, among other things:

“While Malaysians lament about the expensive cost of living and the Goods and Services Tax (GST), this fact doesn’t seem to be reflected on choked Malaysian roads.

“Last year, the sale of Lexus, Mercedes-Benz, Porsche and Jaguars went up by a whopping 31.2 percent, 54.7 percent, 62.5 percent, and 150 percent, compared to pre-GST year of 2014.

“BMW and Audi, while posting a slight decline of 3.8 percent and 1.7 percent, still sold 7,515 and 1,592 units, respectively.”

But if you read on, the NST is forced to admit that the implementation of the GST beginning April last year and the weak ringgit have “definitely slowed down discretionary spending by the average Malaysians, judging by car sales figures.”

The NST went on to admit that car manufacturers such as Proton, Toyota, Ford, Mitsubishi, Hyundai, Kia and Volkswagen, among others, saw sharp declines in sales.

Perodua and Nissan managed to post smaller increases at 9.1 per cent and 1.9 per cent respectively.

Income Gap Widening

This, according to the paper, seems to suggest that while the rich in Malaysia have more money to spend, the poor are getting poorer.

Thank you NST for admitting the truth.

If I may humbly suggest, do make a foray into the villages in Kedah and Kelantan. I am sure you will stumble upon rubber tappers and palm oil growers who live on one-rice meal a day.

It went to quote a survey by the Malaysian Institute of Economic Research (MIER) that shows consumer sentiment index dipping to an all-time low of 63.8 per cent during the 4th quarter of 2015.

Thank you also for admitting that while the rich are doing just fine, the poor are getting poorer and for daring to say that this is in contradiction to Gini Coefficient data produced by the Statistics Department that shows a steady decline of inequality among Malaysians.

The reality is, the income gap between top earning Malaysians and the rest of the people is widening.

A 2014 report on the state of household published by Khazanah Research Institute shows that Kuala Lumpur has a higher nominal GDP per person than South Korea but Kelantan, the poorest state in Malaysia, is poorer than Indonesia.

Finally, thank you to the NST for acknowledging that Malaysia’s household debt had risen to 87.9 per cent of the GDP last year.

[But The Star has a different figure. In an Oct 24 2015 report, it says “total household debt, which has been on a moderating trend since 2012, grew by 7.9% for the first eight months of this year until end August to account for 88.1% of nominal gross domestic product (GDP).]

There has been a huge increase in household debt since Mohd Najib became PM in 2009. In 2010 household debt stood at 72 per cent. Government debt too had jumped – from 41.24 per cent of the GDP in 2008 to 54.45 per cent last year.

In fact, Malaysians are getting poorer. Bank Negara report shows that the per capita income had fallen from US$9,508 in 2010 to US$9,291 last year.

Mohd Najib's Economic Transformation Plan (ETP) envisages that our per capita income should rise to US$15,000 in 2020 in order to become a high-income country.

Instead we are getting poorer and more indebted.

Wallahuaklam.