Archive for the ‘Consumerism’ Category

Get ready for ‘vuca’ world

Monday, February 25th, 2019
Malaysia needs an inclusive and sustainable economic policy to face the challenges of a volatile, uncertain, complex and ambiguous world.

THE newly-formed Economic Action Council (EAC) should introduce a national inclusive and sustainable economic policy (Nisep) to prepare Malaysia to face the challenges of a VUCA (volatile, uncertain, complex and ambiguous) world.

VUCA requires new thinking, strategies and policies. The Kingsley Strategic Institute, an independent think tank is proposing five strategic thrusts:

SUSTAINABLE ECONOMIC GROWTH

Malaysia needs a macro-economic policy that promotes robust albeit sustainable economic growth. The policy must put the country on a strong growth trajectory taking into account its strengths, weaknesses and unique propositions. There must be a strong focus on deregulation to make the private sector a strong engine of growth. This will reduce the crowding out effect and make the sector more competitive.

The policy must empower and encourage the growth of small- and medium-sized enterprises and start-ups. It should embrace digital-driven growth from big data, robotics, artificial intelligence (AI) and the Internet of Things (IoT) to spur digital transformation.

INCLUSIVE DEVELOPMENT

Greater focus must be given to eradicating inequalities. The national economic policy should prioritise inclusive development. Greater attention must be accorded to urban poverty such as the B40 (Bottom 40) income group and Orang Asli. No one should be left behind.

To ensure the success of inclusive development, higher standards of human rights should be set. A needs-based poverty alleviation strategy should be emphasised. The United Nations Sustainable Development Goals (SDGs) should be given attention — promote tripartite performance between government, business and civil society to achieve the SDGs by 2030.

EMPLOYMENT CREATION

This is important, especially for future jobs. More programmes should be developed to reskill and retrain workers.

On-the-job training and certification should be implemented on a larger scale.

Technical and vocational education and training needs to be restructured with a higher pay structure for trained skilled workers. To reduce graduate unemployment, soft skills should be included in the university curriculum, such as communications, problem-solving and critical thinking skills.

We should encourage Malays-ians to be multilingual in Bahasa Melayu, English and either Mandarin, Tamil, Japanese or a European language like German, French or Spanish.

To prepare the next generation for Industry 4.0, coding should be taught in schools. Emphasis should be placed on AI, robotics and IoT to create more jobs of the future. We need also a big push in productivity.

ENTREPRENEURSHIP
DEVELOPMENT

Strategies, policies and plans should be developed to support the development of entrepre- neurs, in particular among youth and women. We need a dynamic and conducive ecosystem to foster entrepreneurial growth and start-ups. Micro enterprises should be given more encouragement and incentives.

Social enterprises should be encouraged and promoted, while companies should be encouraged to realign their corporate social responsibility programmes to support social enterprises that can contribute to social good and community wellbeing.

ETHICAL LEADERSHIP

Underpinning the new national economic policy should be a strong commitment to ethical leadership and integrity. There should be zero tolerance for corruption in public and private sectors.

An all-out war against corruption is necessary.

Institutional reforms should be expedited to establish good governance, integrity, accountability and transparency.

The proposed Nisep should be grounded on six core objectives:

ACHIEVING national unity and harmony;

PROMOTING sustainability with a strong focus on the sustainable development goals;

CREATING an inclusive and caring society where no one is left behind;

DEVELOPING a values-based society upholding integrity and ethical leadership;

PREPARINGMalaysia to face the challenges of the VUCA world and Industry 4.0; and

PROMOTING the 3Is (integrity, inclusiveness, innovation) to achieve the 3Ps (peace, progress, prosperity).

By Tan Sri Michael Yeoh Oon Kheng.

Read more @ https://www.nst.com.my/opinion/letters/2019/02/463071/get-ready-vuca-world

Reasons for price fluctuations

Monday, February 25th, 2019
(Stock image for illustration purposes) The price trends of palm oil affecting local growers are influenced by demand and supply, and other technical factors. NSTP/ADI SAFRI

PALM oil is an important commodity as it contributes almost four per cent to the country’s gross domestic product amounting to approximately RM45 billion per year.

The recent low price at RM1,972 per tonne (in November last year) generated great interest in segments of the population as low prices have affected many smallholders.

Although the statistics recorded a steep downward trend in recent months, the general opinion in the industry is that it may not decline further, and at most will hover at the current price of around RM2,100 per tonne, as shown over the past month.

Fluctuations in prices are common for world commodities, including soya bean and corn. Soya bean oil price was at US$732 (RM2,983) in the last week of January compared with US$690 in December. Sunflower oil recorded a steep price reduction at US$703 in December when it was almost reaching US$780 six months earlier.

The price trends of palm oil affecting local growers are influenced by demand and supply, and other technical factors. Malaysian palm oil production is consumed only up to 18 per cent locally and the balance is exported to India, Europe, China, Africa and the Middle East. Thus, the volatility of global oils and fats demand will affect its price. For instance, the slowdown of palm oil exports to China since June 2018 has resulted in the build-up of palm oil stocks that caused the price to go down. The price and production of competing vegetable oils such as soya bean, corn, sunflower and rapeseed oil also affect palm oil price.

As the yield of these competing oils increase, the demand volume for palm oil reduces. This, again, will lead to an increase in stockpile causing a reduction in palm oil price. Similarly, changes in import policies by the importing countries, such as in regulations or tax structure, can affect the volume of palm oil exports.

When the European Union, in April 2017, banned unsustainable palm oil imports for food and biofuels by 2020, Malaysia felt the impact almost immediately. It was reported that EU imports fell by 15.34 per cent compared with the previous years.

Prices are also affected by the level of production/yield of the crop itself. The two episodes of El Nino in 1997-1998 and 2015-2016, which caused severe droughts, had affected the yield badly causing a shortage of palm oil stocks. During the latter episode, the price of crude palm oil rose to RM3,200 from RM1,800, where smallholders enjoyed the returns of almost RM700 per tonne of fresh fruit bunches (FFB).

The planting and replanting schemes in 2011 and the fertiliser aid scheme in 2015 had contributed to the increase in the production of FFB now as the plants have matured and begun to fruit at a commercially viable volume.

To be fair to the palm oil industry, we should recognise the factors that influence the price cycles of this commodity. Prices of crude palm oil now are still at the higher range compared with between 2003 and 2006 when prices stayed at an all-time low of below RM1,900 per tonne. We are accustomed to the high price range seen in the last 11 years since 2008 that we have forgotten the downturn in prices of the past.

By Dr Fazlin Ali.

Read more @ https://www.nst.com.my/opinion/letters/2019/02/463378/reasons-price-fluctuations

Looking beyond oil

Monday, December 10th, 2018
Wind turbines and solar panels are a feature of the landscape in Zhangjiakou, Hebei province, China. Southeast Asia is cited as a potential renewable energy hotspot. Reuters

ALTHOUGH expected for some time, the recent establishment by Petronas of a “New Energy” team to look at renewables for possible future sources of energy is a far-sighted and welcome development.

Petronas has expressed interest over the last year to diversify into renewables amid low oil prices. In March, its chief executive officer Tan Sri Wan Zulkiflee Wan Ariffin said Petronas would explore new business areas including new energy, citing opportunities in solar power in particular.

Petronas joins a number of large global oil and gas firms looking into renewables, including ExxonMobil, Royal Dutch Shell, BP and Total — all of which are raising investment in cleaner energy.

Why the interest in renewable energy (RE)?

It’s reliable, plentiful and will continue to decrease in cost as technology and infrastructure improve. In addition to solar and wind, the RE portfolio includes geothermal, hydropower and tidal energy, and biofuels from algae. And, of course, these energy sources produce few emissions of carbon dioxide which cause the greenhouse effect and global warming.

With respect to electricity generation, the latest United Nations figures show that the world last year installed a record 98 gigawatts of new solar capacity, far more than the net additions of any other technology — renewable, fossil fuel or nuclear.

Solar power last year attracted far more investment, at RM699 billion, up 18 per cent, than any other technology. According to the annual Global Trends in Renewable Energy Investment 2018 report, produced by UN Environment, the Frankfurt School-UNEP Collaborating Centre, and Bloomberg New Energy Finance, investments in solar power made up 57 per cent of the 2017 total for all renewables (excluding large hydro) of RM1.15 trillion, “and it towered above new investment in coal and gas generation capacity”, estimated at RM428 billion.

A driving power behind last year’s surge in solar was China, where an unprecedented boom saw some 53 gigawatts added — more than half the global total — and RM359 billion invested, up 58 per cent.

Driving the trend are falling costs for solar electricity, and to some extent wind power. Global investment in renewables has exceeded RM830 billion for eight consecutive years. Since 2004, the world has invested RM12.2 trillion in these green energy sources.

That said, renewables generated just 12.1 per cent of world electricity in 2017. That’s up from 5.2 per cent a decade earlier, but still a small fraction of total world energy needs.

The writing is on the wall, nonetheless. With growing evidence of the impacts and rising cost of climate change, pressure is building to reduce CO2 emissions. On Dec 2, negotiators from around the world opened the United Nations’ annual climate change conference, now three years after a landmark deal in Paris set a goal to keep global warming well below 2° Celsius.

Displacing and replacing fossil fuels won’t be easy and the world’s big oil companies, with their global infrastructure networks, are among the most important allies in this effort.

And as one commentator recently observed, the big energy firms have the most to lose if they fall behind the technology curve. They need to lead the march towards clean energy sources.

ExxonMobil is spending RM4.2 billion per year on basic research in low-carbon technologies, with a major focus on genetically engineered algae being farmed with an aim to produce an initial 10,000 barrels per day of renewable crude, which can then be upscaled to larger levels. Among other efforts, ExxonMobil is also partnering with America’s largest biodiesel producer, Renewable Energy Group, to create microbes that could turn waste biomass into biodiesel fuel.

BP, meanwhile, produces about 200 million gallons of low-carbon ethanol each year in Brazil. Its three facilities there also burn leftover agricultural wastes to power themselves and add 850 gigawatt-hours of electricity to the grid.

Meanwhile, BP and DuPont have formed a joint venture to use genetically engineered microbes to manufacture butanol, an alcohol that can be blended into gasoline, much like ethanol is added in the US. The annual US market opportunity for butanol is estimated at more than 20 billion gallons.

Royal Dutch Shell is focused on solar power and energy efficiency. It also recently acquired a firm specialising in power management solutions.

It is the giant French company Total that leads all the world’s energy firms in green energy investments. Its goal is to generate 20 per cent of its business from low-carbon products within 20 years. Its venture capital fund has invested RM667 million in about 20 projects and it owns over half of a global solar company starting to turn sustainable profits.

The International Renewable Energy Agency (IRENA) recently cited Southeast Asia as a potential RE hotspot. Unfortunately, the agency said, the region lacks policy frameworks that would encourage investment. That needs to change.

By Zakri Abdul Hamid.

Read more @ https://www.nst.com.my/opinion/columnists/2018/12/439079/looking-beyond-oil

Inclusive economy to boost people’s purchasing power

Wednesday, October 31st, 2018
Deputy Economic Affairs Minister Dr Mohd Radzi Md Jidin said the government wanted to achieve that by focusing on increasing workforce productivity, quality investment and innovation. NSTP/ASWADI ALIAS.

KUALA LUMPUR: The government seeks to create an inclusive economy that would boost the people’s purchasing power.

Deputy Economic Affairs Minister Dr Mohd Radzi Md Jidin said the government wanted to achieve that by focusing on increasing workforce productivity, quality investment and innovation.

He said the government was confident that economic policy would increase the country’s economic growth and thus boosts the people’s buying power.

“The government policy focuses on balancing the objective of strengthening fiscal position and emphasise economic growth to address market and investor sentiment.

“The government will give specific focus on boosting the people’s confidence on economic prospects via increase in workers’ compensation to the Gross Domestic Product (GDP) and thus increase the people’s purchasing power,” he said at the Dewan Rakyat today.

He was answering a question from Datuk Seri Bung Mokhtar Radin (BN-UMNO-Kinabatangan) on plans and efforts by the government to ensure Malaysia’s economic stability and boost the people’s buying power as a whole.

By Hidir Reduan Abdul Rashid .

Read more @ https://www.nst.com.my/news/government-public-policy/2018/10/426533/inclusive-economy-boost-peoples-purchasing-power

Prices of items have fallen since SST introduced, says Deputy Minister

Wednesday, October 17th, 2018

KUALA LUMPUR: The prices of 70% of goods surveyed have gone down since the implementation of the Sales and Service Tax (SST) on Sept 1, says Domestic Trade and Consumer Affairs Deputy Minister Chong Chieng Jen.

“An analysis of price changes was done, comparing average prices between May and September this year. On the whole, 70% or the prices of 291 items was reduced, while 27% or 115 items saw prices increasing and three percent or 11 of items saw no changes in prices,” he said when answering a question raised by Datuk Alexander Nanta (PBB-Kapit) in Dewan Rakyat on Wednesday (Oct 17) .

He said the price survey was done on a total of 417 household items covering fresh produce, dried and packed foodstuff, as well as infant food and products.

Chong said the prices for the 291 goods were reduced by an average of between 0.11% and 37.61%.

Chong informed the House that 146 notices were issued to traders that were suspected of profiteering, of which about 100 had flouted regulations.

On that note, a brief shouting match ensued between several Barisan Nasional Opposition MPs and Pakatan Harapan MPs.

The commotion was sparked by Datuk Ahmad Maslan (BN-Pontian) who called for another price survey, as the present was done during the tax Goods and Services Tax (GST) holiday before the implementation of the SST.

He noted that survey was done based on manufacturers’ supply of previous stock of goods, and not on current supply.

To this, Chong reminded Ahmad that he had earlier acknowledged that it was too premature to assess the impact of the SST on prices of goods.

by martin carvalhorahimy rahim,  and fatimah zainal
Read more @ https://www.thestar.com.my/news/nation/2018/10/17/prices-of-items-have-fallen-since-sst-introduced-says-deputy-minister/#fgPhyxrRAglix2mb.99
Read more at https://www.thestar.com.my/news/nation/2018/10/17/prices-of-items-have-fallen-since-sst-introduced-says-deputy-minister/#fgPhyxrRAglix2mb.99

Govt to impose levy on import of plastic waste starting next month

Saturday, September 29th, 2018
Housing and Local Government minister Zuraida Kamaruddin said plastic waste importers would have to adhere to the new criteria which was drawn out by the ministry following the three months freeze of their Approved Permits (AP). BERNAMA photo

SHAH ALAM: The government will impose a levy on the import of plastic waste by local industry players into the country beginning next month.

Housing and Local Government minister Zuraida Kamaruddin said plastic waste importers would have to adhere to the new criteria which was drawn out by the ministry following the three months freeze of their Approved Permits (AP).

The freeze, which took effect in late July due to air pollution stemming from illegal factories processing plastic waste in Kuala Langat and the discovery of AP holders renting out the license to second and third parties, ends on Oct 23.

Zuraida said the freeze would not be extended and importers would have to comply to other new and stringent criteria, on top of having to fork out money for bringing in the plastic waste from foreign countries.

“We will impose a levy on the import of plastic waste at RM15 a tonne. It will start after Oct 23 and applicants will have to comply with that. I heard it (plastic waste) is a lucrative business.

“We have carried out discussions with the industry players and they have somewhat given an indication that they agreed to that. We have discussed this with them before making the decision,” said Zuraida today after chairing a coordination meeting at the Kuala Langat Municipal Council (MDKL) where she addressed the issue of illegal factories processing plastic waste which have caused air pollution, endangering the lives of the local community.

Charging such levy, added Zuraida, has never been done before and materials that come into the country were never checked by the Customs too.

“Now, one of the criteria is for the AP to tally with the approval given by the Customs Department. I urge the department to be more strict and that will be (one of) the factors in monitoring the importers.

“That is why in this meeting (today), there are feedbacks that plastic waste are imported and being given to illegal factories,” said Zuraida.

She said applicants of the APs from Oct 23 onwards will be required to furnish additional criteria such as the names of companies importing and exporting the plastic waste to reflect the authenticity of the business, adherence to the apacity and storage of raw materials, approval from the Department of Environment as well as housekeeping of the premises subjected to checks by the National Solid Waste Management Department (JPSPN).

Meanwhile, Zuraida revealed that there were 54 factories processing plastic waste operating in the Kuala Langat municipality, out of which 13 are licensed after it were legalised by the state government.

Zuraida ordered a meeting to be held with all parties to be held on Oct 2 at the local council’s office and it will be chaired by the JPSPN director-general Ismail Mokhtar.

“In the Oct 2 meeting, discussions would revolve around finding ways to dispose the existing plastic waste at the illegal factories, taking over of the materials from the unlicensed parties by licensed factories and the time frame of the actions,” she said.

By Dawn Chan.

Read more @ https://www.nst.com.my/news/government-public-policy/2018/09/414831/govt-impose-levy-import-plastic-waste-starting-next

Consumer group wants stricter regulations on sale of health juices

Wednesday, September 26th, 2018
The government should make it mandatory for supplements to be inspected and approved by the Health Ministry before the products are allowed to enter the market, Consumers’ Association of Penang (CAP) said today.

GEORGE TOWN: The government should make it mandatory for supplements to be inspected and approved by the Health Ministry before the products are allowed to enter the market, Consumers’ Association of Penang (CAP) said today.

This comes following the ministry’s ban on three health juices – Jus Al Sunnah, Jus Al Sunnah Gold and Jus Al-Sunnah Penawar – produced by Sri Saga Marketing Sdn Bhd, a company which does not exist.

Its president S.M. Mohamed Idris said the only way to stop these products from being sold in the market was for the ministry to impose stricter regulations.

“As such, we ask that it be made mandatory for supplements to be inspected and approved by the ministry before they are allowed to enter the market.

“In the case of the Jus Al Sunnah products, the ministry also has to send out its enforcement officers to confiscate the products instead of waiting for retailers to hand over their stocks, and also to promptly withdraw all similar products from the market.

“We are extremely disappointed that the ministry is only doing this now which shows its lackadaisical attitude towards the people’s health and safety… There are so many things wrong with this Jus Al Sunnah situation,” he said.

Elaborating, Idris said the products had already been banned in several countries after they were found to contain steroids.

“Singapore had already banned the products in 2017. Brunei had stated clearly on June 9, this year on their website why the three Jus Al Sunnah juices as well as three other products manufactured in Malaysia were banned.

“CAP has also highlighted this issue to the ministry’s Food Safety and Quality Division and Pharmaceutical Services Division in our letter dated June 27, this year. Why did the Health Ministry wait so long to ban these dangerous products?

“One might also ask how such dangerous products even made it into the market. The answer is that supplements are not classified as medicines and thus do not need to be inspected by the Pharmaceutical Services Division.

“Instead supplements are labelled as food products… Therefore any action is always taken after the products are found to have violated provisions of the Food Act 1983,” he added.

Idris said, even though the Health Ministry was the proper authority in this matter, at least in this case, other ministries should also be held responsible.

He added that the Jus Al Sunnah products were made to be marketed to Muslims.

“The name of the product itself, ‘Al Sunnah’, is a clear indication that the masterminds behind this venture had commercialised Islam to target Muslim consumers.

“More importantly Muslims look for the official Halal label on products to determine if they are permissible, and the Jus Al Sunnah products had the official label,” he said, noting that the official label could also be easily be printed on products to fool Muslim consumers.

By Audrey Dermawan.

Read more @ https://www.nst.com.my/news/nation/2018/09/415210/consumer-group-wants-stricter-regulations-sale-health-juices

A ticking time bomb

Sunday, September 23rd, 2018
Turkey is still struggling to stabilise its lira. AFP PIC

GEORGE Soros, Bill Gates and other pundits have been predicting another financial crisis.

In their recent book, Revolution Required: The Ticking Bombs of the G7 Model, Peter Dittus and Herve Hamoun, former senior officials of the Bank of International Settlements, warned of “ticking time bombs” in the global financial system waiting to explode, mainly due to the policies of major developed countries.

Recent events vindicate such fears. Many emerging market currencies have come under considerable pressure, with the Indonesian rupiah, Indian rupee and South African rand all struggling since early this year. Brazilian real fell sharply in June, and Argentina has failed to stabilise its peso despite seeking International Monetary Fund (IMF) aid. As Turkey struggles to stabilise its lira, many European banks’ exposure has heightened fears of another global financial crisis.

Why the vulnerability?

Some fundamental weaknesses are at the core of this vulnerability. These include the international financial “non-system” since the collapse of the Bretton Woods system in 1971, and continuing to use the United States dollar as the main international reserve currency.

This burdens deficit countries vis-à-vis surplus countries and ensures near-universal vulnerability to the US monetary policy. Thus, most countries accumulate dollars as a precaution, that is, for “protection”, eschewing other options, such as investing in socially desirable projects.

Policymakers not only failed to address these weaknesses following the 2008-2009 global financial crisis (GFC), but also compounded other problems. Having eschewed stronger, more sustained fiscal policy interventions, monetary policy virtually became the sole policy instrument. Major central banks, led by the US Federal Reserve, embarked on “unconventional monetary policies”, pushing real interest rates down, even into negative territory.

Emerging and developing economies (EDEs) offering higher returns temporarily experienced large short-term capital inflows. The external debt of emerging market economies has grown to over US$40 trillion (RM165.6 trillion) since the GFC. The combined debt of 26 large emerging markets rose from 148 per cent of gross domestic product (GDP) at the end of 2008 to 211 per cent in September last year, according to the Institute of International Finance (IIF).

Easy money raised household and corporate debt, fuelling property and financial asset price bubbles. According to IMF April 2018 Fiscal Monitor, global debt peaked at US$164 trillion in 2016, or 225 per cent of global GDP, compared with 125 per cent before the GFC. The IIF reported that global debt rose to over US$247 trillion in early 2018, that is, equivalent to 318 per cent of GDP.

Rising debt levels pose serious downside risks for the global economy. With easy money coming to an end, as the Fed continues to “normalise” monetary policy by raising the policy interest rate, capital flight to the US is undermining emerging market currencies. When debt defaults increase with interest rates while income growth remains subdued, the world becomes more vulnerable to financial crisis.

Both developed and developing countries have less policy space than during the GFC. Most governments are saddled with more debt following massive financial bail outs followed by abandonment of efforts to sustain robust recovery.

According to the IMF’s April 2018 Fiscal Monitor, average public debt of advanced economies was 105 per cent of GDP in 2017, constraining fiscal capacity to respond to crisis. Meanwhile, monetary policy options are exhausted after a decade of “unconventional” monetary policies.

General government debt-to-GDP ratios in emerging market and middle-income economies almost reached 50 per cent in 2017 — a level only seen during the 1980s’ debt crisis. The 2017 ratio exceeded 40 per cent in low-income developing countries, climbing by more than 10 percentage points since 2012.

Playing With Fire by Yilmaz Akyuz, former South Centre chief economist, has highlighted the self-inflicted vulnerabilities of developing countries. Public debt-GDP ratios in EDEs are likely to rise due to falling commodity prices and stagnant global trade, while they have almost no monetary policy independence due to deeper global financial integration.

While corporate sectors have been busy with mergers, acquisitions and share buybacks with cheap credit, instead of investing in the real economy, the financial sector has successfully portrayed sovereign debt as “public enemy number one”.

Held hostage to finance capital, governments around the world have wasted the opportunity to improve productive capacities by investing in infrastructure and social goods when real interest rates were at historic lows. At around 24 per cent of global GDP, the global investment rate remains below the pre-crisis level of around 27 per cent, with investment rates in EDEs either declining or stagnant since 2010.

Failure to address the falling wages’ share of GDP, rising executive pay and asset price bubbles, due to “easy” monetary policy, have continued to worsen growing income inequality and wealth concentration. Meanwhile, deep cuts in government spending and public services, while reducing top tax rates, cause anger and resentment, often blamed on “the other”, contributing to the spread of “ethno-populism”.

In turn, growing inequality limits aggregate demand, which has been maintained by unsustainably raising household debt, that is, perverse “financial inclusion”.

Turbulence in currency markets is due to developing countries’ limited economic policy space. A decade after the GFC, developing countries still experience lower growth and investment rates.

Financial sectors of emerging market economies now have more and deeper links with international financial markets, also reflected in high foreign ownership of stocks and government bonds, with large sudden capital outflows causing financial crises.

By ANIS CHOWDHURYJomo Kwame Sundaram.

Read more @ https://www.nst.com.my/opinion/columnists/2018/09/413926/ticking-time-bomb

‘SST’s impact on prices of goods not significant’

Tuesday, September 18th, 2018
(Stock image for illustration purposes) “The SST caused some of the prices of items to go up, but it depends on the type of goods and services.”

KUALA LUMPUR: Kuala Lumpur Hawkers and Petty Traders Association (KLHPTA) said the implementation of the Sales and Service Tax (SST) has no significant impact on prices of goods sold by hawkers and traders.

KLHPTA chairman Datuk Ang Say Tee said the change of taxation also did not cause a sharp rise or fall of prices.

“The SST caused some of the prices of items to go up, but it depends on the type of goods and services

“The impact of (SST) is not so significant to the hawkers’ and traders’ businesses,” he said at a press conference on the Mid-Autumn Festival at Central Market here today.

He also acknowledged that through SST, the profit generated by traders and petty hawkers was not as big as during the implementation of the Goods and Services Tax (GST) system.

Ang said, however, that hawkers and traders were more burdened with the Ringgit currency drop and the new minimum wage had yet to be implemented.

“As the minimum wage level has remained unchanged, and with the implementation of the tax system, the people’s purchasing power has become weaker and this impacts sales revenue,” he told reporters after announcing the annual Mid-Autumn Festival programme which would be held on Sept 22 in collaboration with Central Market.

By Amira Eizan AzmanZarul Fitri Muhd Zamrie.

Read more @ https://www.nst.com.my/news/nation/2018/09/412578/ssts-impact-prices-goods-not-significant

2019 Budget offers chance for reform: experts

Monday, September 10th, 2018
PH likely to boost spending efficiency, focus on people’s welfare, say experts. (File pix)

ECONOMISTS and market observers say the 2019 Budget, the first under the Pakatan Harapan (PH) government, presents an opportunity for an overhaul and reform of the economy.

Scheduled for tabling in Parliament on Nov 2, the budget would likely be less than the RM280.25 billion “mother of all budgets” tabled last year by Datuk Seri Najib Razak.

Prime Minister Tun Dr Mahathir Mohamad had said the 2019 Budget would entail many sacrifices as the government grappled with reducing more than RM1 trillion in debts and liabilities it inherited from the previous administration.

“This budget is of sacrifice, everyone will have to sacrifice,” he said in an interview published yesterday.

“We can’t spend more than our earnings. We can’t entertain all sorts of requests. We have to accept that we must sacrifice.”

Responding to Dr Mahathir’s comments, Asian Strategy and Leadership Institute’s Centre of Public Policy Studies chairman Tan Sri Ramon V. Navaratnam said Malaysians must “cut a coat according to one’s cloth”.

“Squeezing the budget is good only if and when you squeeze it in the right places. The strategy should be to do more for the poor and incentivise the rich to boost the economy and generate employment quantitatively and qualitatively,” he told NST Business.

Ramon said monopolies, protective policies and race-based programmes should be reduced, if not removed altogether, albeit in stages.

“We need more competition, meritocracy and higher productivity that can be incentivised through more modern, updated and enlightened fiscal and monetary policies, and practices that are balanced and more equitable.”

Ramon said instead of mild fiscal adjustments and tinkering with the system, this year’s budget initiatives should go all out against corruption, wastage and cronyism.

“The government must focus on the poor regardless of race. The rich should not be pampered but encouraged to do better via more liberal policies.”

Ramon said income inequality was a serious issue in Malaysia, made worse by rising inflation.

Sunway University Business School economics Professor Dr Yeah Kim Leng said the likely lower 2019 Budget was in line with lower-than-expected revenue due to the change from the Goods and Services Tax (GST) to the Sales Tax and Services Tax (SST).

He said one of the key challenges included how the government could increase its spending efficiency, delivering the same quality of services with a lower budget.

“This can be achieved by reducing wastages and leakages.”

Yeah said to meet the people’s expectation — in terms of cost of living, including welfare and economic support — the government would likely prioritise social and economic sectors.

“Spending on social programmes, such as education, healthcare and support for the low-income group, will continue to be the priority.”

The government has reviewed some mega infrastructure projects since taking over.

He said the government should look at how to enhance the workforce’s productivity and ability to increase wages to reduce the inflationary pressure in property, education and healthcare.

AmBank group chief economist and head of research Dr Anthony Dass said the 2019 Budget adjustment would likely be about optimising expenditure and reprioritising investments.

“This can lower public debt and balance the fiscal book.

“The government will need to optimise its expenditure by focusing on priority projects or
investments that trickle down positively to the market and people.”

He said there would be limited room for incentives in the form of tax cuts for both households
and businesses, probably some indirect tax incentives for the middle income and below households.

“To lower the high operating expenditure compared with
development expenditure, among the key areas will be strong enforcement, which will reduce leakages and bribery, and put a cap on discretionary spending.

“The need to work closely with the private sector is vital in creating more jobs for Malaysians. Focus on foreign direct investments should be on those who can bring in more value-added investments. There should not be special privileges for specific countries.”

MIDF Research chief economist Dr Kamaruddin Mohd Nor said people-related projects would likely be prioritised.

“Targeted programmes to address and improve the wellbeing of B40 and M40 groups will continue to be implemented.”

Read more @ https://www.nst.com.my/news/nation/2018/09/410049/2019-budget-offers-chance-reform-experts