initially posted in substack
updated 10th June 2022 with embedded references and illustrated graphs
1] While The International Monetary Fund (IMF) is optimistic that Malaysia’s economy will expand by 5.75 per cent in 2022, driven by – post-Covid19 pandemic – pent-up domestic demand and strong external demand,
2] The federal government’s deficit had already reached about 6.5 percent of GDP in 2021, higher than the 5.5 deficit in Budget 2021, and
3] Inflation had increased by 3.2% year-on-year by December 2021, with rises in food and fuel prices. As per IMF and BNM (Bank Negara Malaysia) estimations, Malaysia’s inflation is projected to rest at around 2.5%, depending on transitory supply-chain challenges from the ongoing Ukraine conflict.
4 Added on, the ringgit had depreciated by 0.7% against the US dollar in the first quarter of 2022 (YTD as at 11 May 2022: at an even higher margin of -4.7%).
5] More concerning is Malaysia was reported with US$57,566,000,000 of international debts in 2021, according to the World Bank collection of development indicators on International Debt Securities: translated as two hundred fifty-three billion two hundred ninety million four hundred thousand Malaysian Rinngit Debt or RM$7,449 per rakyat owing.
6] Also, a prematurely de-industrialisation process in late 1980s, national “growth” had been geared towards financialization capitalism with GDP more dependent on private internal consumption than on external export-forward drives: with the main sources of foreign direct investments from Singapore and primarily China (inclusive of China-based companies incorporated in Hong Hong):
7] Long term, under an ethnocratic state-led GLC-orientated capitalism developmental push, the poverty-eradication and equal development is pulled back :
where improvements in productivity ever becoming more critical for any future (and further) growth path. Malaysia’s labour productivity continues to linger, dawdling well below levels seen in the advanced economies. According to the Malaysia Productivity Corporation’s 2018 report on measures of multifactor productivity growth – a parameter for technological innovation – has been negative over the past decade.
Therefore, the key challenge for the next two decades, at least, would be to improve the indigenous innovative capacity of domestic firms and to continue to raise the productivity of Malaysian workers and firms whereas succeeding ruling regimes had given preference towards corporate capital than socioeconomic determinants of rakyat2 well-being.
8] Secondly, even as measures of national poverty and inter-household income inequality has declined over the decade, inequality between regions has not, but accentuated. Ten years ago, the median household income in Kuala Lumpur was 2.6 times higher than in Kelantan. Latest data indicates that this ratio has crept higher to 3 times. Indeed, households peninsular East Coast and in East Malaysia still experience a relatively high incidence of poverty than the rest of the country in a state of development of underdevelopment.
9] Of great concern are regional inequalities as in Sabah and Sarawak where the rights to access to basic infrastructure are sparse or not in existence.
In 2016, nearly one in three households living in Kelantan do not have access to piped water in the home, while one in nine households in both Kelantan and Sabah live in houses classified as ‘dilapidated’. In parts of Sabah and Sarawak where connectivity is poor, geographic disparities in access to basic services are more alarming: one in five households in East Malaysia live further than 9km from the nearest public healthcare facility and secondary school.
10] Therefore, neoliberalism entity like the IMF’s Executive Board may praise country’s performance to elicit continuing consultation services and financial dispensing from westetn imperialism .
It is another budge in opening door to Global North domination and exploitation on national economic development – and indebting nations – than an equal exchanges for mutual shared prosperity among common wealth of nations.
Firestorms 