Cut the talk, act to address rising prices, food security

 

It has started. A small group of people protested against the rising prices of food items this week in front of Sunway Pyramid in Selangor.

In the video clip that I saw, they were holding banners which read “Turunkan Harga Barang”(bring down the prices of goods) and “Turun! Turun! Turun harga barang”(Reduce! Reduce! Reduce the price of goods).

Placards declared, “Even the price of bread has gone up” and asked, “What is the minister doing?” A few protesters carried placards that urged passing motorists to sound the horn if they agreed – and many obliged.

I expect more people to take to the streets in the months to come if the government fails to address the suffering of the poor, especially the urban poor. People have been hurting since the Covid-19 pandemic began and lockdowns were introduced. Now, rising prices are making it a double whammy.

And I expect the prices of food, consumer items and services to keep rising well into next year.

Yesterday, FMT reported that tempers flared in the Dewan Rakyat over the rise in the prices of chicken and vegetables, with opposition MPs such as Anwar Ibrahim and Lim Guan Eng describing it as a “national crisis”.

National crisis or not, I’m afraid neither street protests nor government assurances will resolve the problem.

It’s not as if the price increases everyone is talking about happened overnight. Prices of goods have been going up over the past year or so, particularly after the lockdowns which brought many businesses to a halt or slowed them down.

In my column in May 2020, I had predicted that prices would climb following the lifting of the movement control order as the temporary closure of businesses, not just in Malaysia but also elsewhere, would disrupt the supply chain and cause shortages in produce and products. I had also said some firms and businessmen might try to recoup part of what they had lost by raising the prices of their goods and services post-lockdown.

In fact, domestic trade and consumer affairs minister Alexander Nanta Linggi acknowledged in January this year that the prices of some essential goods had gone up in states such as Johor, Perak, Kelantan and Pahang.

It was to prevent such rises in food prices that the short-lived government of Muhyiddin Yassin announced an allocation of RM1 billion for food security in March 2020. How was the money actually spent?

The Consumers Association of Penang, the most active consumer movement in the country, said on Nov 23 that the prices of vegetables had increased by up to 200% over the past two weeks.

CAP president Mohideen Abdul Kader claimed the price of vegetables such as cauliflower, choy sum, broccoli, sawi, string beans, cabbage, and red and green chilli had increased by 40% to 200%.

He said the price of broccoli had risen from RM8 to RM20; cauliflower from RM7 to RM16; choy sum from RM3 to RM9; red chilli from RM13 to RM19; green chilli from RM10 to RM14; sawi from RM5 to RM8; string beans from RM8 to RM15; and cabbage from RM4 to RM6 in Penang.

The domestic trade and consumer affairs ministry did not challenge the assertions or the figures quoted by Mohideen.

The ministry’s Penang director Mohd Ridzuan Ab Ghapar, in fact, said in a statement that according to the Agriculture Department and the Federal Agricultural Marketing Authority, the price rise was due to rain which had disrupted vegetable supplies. Vegetables in farms in Cameron Highlands, Pahang, had, for instance, been destroyed, he added.

Imported vegetables, he said, were also in short supply due to weather conditions in the countries of origin, adding that an increase in logistics costs was also contributing to the higher prices.

On Nov 27, the ministry launched Ops Pasar (vegetables) nationwide to monitor the prices of vegetables and act against those who were overpricing it.

Th fact is, vegetables are not listed under price-controlled items so how do ministry officials intend to act effectively?

The items that fall under price control are: granulated and coarse refined white sugar, liquid petroleum gas, petrol Ron 95, diesel, face masks and goods that are listed under the seasonal price control scheme during the major festivals.

I’m sure the ministry is considering putting a ceiling price on some food items but I’m not sure if it is a good idea in the long term.

The rise in prices is like a fever that we get; a symptom that something is wrong. We can take some tablets to bring down the fever but that may not address the unseen problem within – until, of course, it gets out of hand.

So, the better option would be to ferret out the reasons for the price increases and attempt to resolve the core issues.

The first question is this: Are we growing enough food?

We have 5 million hectares of land under palm oil but only one million hectares for food crops. What does that tell you?

In 2019, we only produced about 46% of the vegetables we needed. We produced 70% of rice, 79% of fruits, 61% of fresh milk, 5% of dairy products, 23% of beef and 11% of the mutton consumed. No wonder our food import bill in 2020 was RM55.5 billion.

Bank Negara Malaysia said in one of its bulletins in 2019 that Malaysia imported 24% of its food needs.

It is to be noted that the food trade deficit, which was RM1.1 billion in 1990, increased to RM18.6 billion in 2016.

Have successive governments been serious about food production?

Over the years, our governments have emphasised the importance of agriculture and have set aside allocations to improve farming methods and raise food production. In fact, it was one of the main agendas of the Abdullah Ahmad Badawi government.

Where did all the plans go? Where did all the money go?

Just last month, in unveiling Budget 2022, finance minister Tengku Zafrul Aziz said the agriculture sector would get an allocation of RM4.82 billion.

Agriculture and food industries minister Ronald Kiandee said the allocation would be used to transform the agricultural sector to become more modern and dynamic, and improve food security.

I don’t know how many times in my years as a journalist I have heard ministers use the term “transform”, “modern”, and “dynamic” in describing their plans for the agricultural sector.

Federation of Malaysian Consumers Associations (Fomca) president N Marimuthu suggested recently that idle land be put to agricultural use to produce food, noting that 103,563 hectares in Peninsular Malaysia and Labuan had been identified as idle. I don’t believe anyone would disagree with this idea.

Zafrul did say that under Budget 2022 the government planned to lease out idle land owned by the federal government, and even Malay reserve land, for agriculture and business projects.

The fact is, even this talk of optimising idle land for agriculture is not new. I have heard previous agriculture ministers talking about it. For instance, making efficient use of idle padi land was all the rage at one time.

But that’s our national malaise: Our implementers either don’t walk the talk or they are so incompetent, they have to attempt the same thing year after year.

Marimuthu also suggested the discontinuation of approved permits or APs for food imports, saying the practice had put local producers at a disadvantage because they were forced to lower their prices to compete in the free market.

APs are issued for such produce as mangoes, coconuts, papayas, certain vegetables, meat and nine different types of seafood.

Doing away with APs may be problematic because we all know that the ordinary farmer does not get APs. You have to be politically connected to the powers that be. And in Malaysia, we know that support for certain parties or leaders can win you rewards.

Fomca, in fact, has long said that monopolistic practices along the food supply chain contribute greatly to high food prices.

In Aug 2019, the Malaysia Competition Commission (MyCC) issued a press release on its findings and recommendations following a market review on the food sector under the Competition Act 2010. Among other things it found the existence of multiple intermediaries within the supply chain, the misuse of APs and over-reliance on a few suppliers to be major problems affecting competition and ultimately prices.

But Malaysia’s problem is not scarcity of food, not for now at least. It is the question of adequate supply and affordability. The government has to address these or be prepared to face more protests.

The government can of course point to the fact that rising prices is not a phenomenon unique to Malaysia and that almost every country is reporting a rise in prices, especially food prices, largely due to the effects of pandemic control measures.

Try telling that to the family man who earns RM1,200 a month, or even RM3,000 a month in the city. - FMT

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.