MALAYSIANS are now enjoying a much higher standard of living than before, said the economics, trade and regional integration director at Malaysia's Institute of Strategic and International Studies, Firdaos Rosli.
He said Malaysians were slowly buying foreign vehicles rather than national ones, besides spending less on groceries, instead preferring to eat out, as highlighted in the 2016 Household Expenditure Survey.
He said according to data published by the Malaysian Automotive Association, the sales of mid-range foreign cars, such as Honda, Ford, Mazda and Subaru, had been registering a higher annual growth rate since 2009 than local automotive champion Perodua.
“More recently, goods bought via a popular online platform registered sales of over RM100 million on November 11, or Singles Day, alone.
“Malaysia is the biggest online game market in Southeast Asia, where about RM2.45 billion was spent in the past 10 months,” he said in a statement yesterday.
He said if the weakening of the ringgit was really an issue, it would be hard to explain how, in the first nine months of the year, the country imported about twice the value of mobile phones (RM6.85 billion) than 1.4l- to 3l-engine cars (RM3.47 billion).
“In fact, the value of mobile phone imports is higher than our top food imports, such as rice, milk and cream, coffee, onion and garlic, coconut, soybean, corn, milk and cream powder combined. Plus, the retail prices of these products are usually much higher.”
Firdaos said the strengthening of the US dollar against the ringgit since September 2014 did not deter Malaysians from spending money when travelling abroad.
"Referring to the latest Bank Negara Malaysia data, for the first 10 months of the year, the value of transactions involving Malaysian credit cards overseas increased steadily, from RM10.9 billion in 2015, RM12.3 billion last year and RM13.2 billion in 2017.
“In fact, the value of cash advance by Malaysian credit cards abroad spiked by 68.9% this year, compared with the same period in 2015.”
He said the number of transactions and domestic purchases recorded an upward trend as well, with data suggesting that Malaysians continued to spend money abroad despite living in a strong greenback era since late 2014.
On the country's unemployment rate, which has been kept under 4%, defined as full employment by the Organisation for Economic Cooperation and Development, since 1995, he noted that the rate had not breached the 4% mark despite the slump in Malaysia's gross domestic product growth due to the 2007/08 global financial crisis.
“Last year, Malaysia’s unemployment rate of 3.4% was even lower than that of many advanced economies, such as the US (4.9%), Germany (4.1%) and South Korea (3.7%).
Even though the prices of goods and services had risen over the last couple of years, he said, since 2009, the mean monthly household income had increased across the board, with that of the bottom 40% of households group growing the fastest.
“In addition to the increase in the share of compensation of employees to GDP from 29.3% in 2008 to 35.3% last year, official statistics also reveal that Malaysia’s average monthly household income has risen by 6.6% per year between 2014 and last year.”
On the 1Malaysia People's Aid (BR1M), he said Malaysians should recognise two key facts regarding the initiative: a number of European countries were warming up to the idea, but in the form of a universal basic income, and that BR1M had helped to reduce income inequality.
“According to official statistics, Malaysia’s GiNi coefficient reduced from 0.441 in 2009 to 0.401 in 2014. Such a trend is consistent in all ethnic groups, but interestingly, the Chinese community recorded the lowest reduction.”
Firdaos said the gradual reduction in personal income tax for middle-income earners, as announced in Budget 2018 by Prime Minister Najib Razak in October, meant that they had a much larger disposable income than before, and the move was expected to benefit some 261,000 people.
On the expansion and streamlining of the public transport system since 2009, he said it had benefited Klang Valley residents, offering low fares and more transport options, referring to the legalisation of e-hailing services.
However, he said, the government must keep an eye on the disadvantaged while it continued to address the people's ability to earn, and workers must be properly compensated for the work being performed, which would, in turn, boost the nation’s productivity. – Bernama, December 12, 2017.
Source : https://www.themalaysianinsight.com/s/27210/