5 Jan 2023 4:00PM
ECONOMIC Affairs Minister Rafizi Ramli believes consumers are to blame for high food prices because they continue to purchase essentials although prices have gone up. He would suggest, for example, that if chicken prices go up, people should stop eating chicken.
According to the Malaysia Economic Monitor Report published by the World Bank in 2019, it was reported that 30% of Malaysians felt they did not have enough money for food. The number of Malaysians who felt that they did not have enough money for food had doubled since 2012.
In a study by Universiti Putra Malaysia on young workers in public housing areas, 48.9% reported that they needed to borrow to buy basic food items, 61.1% reported not having enough money for medicines and 89% made late bill payments.
In a more recent report, it has been stated that post-pandemic, 20% of M40 have fallen into the B40 category.
In the World Bank Report, it has clearly reported that between 2012 and 2018 both rural and urban Malaysians have felt growing hardship in their life conditions. In the simplest terms, honourable minister, consumers are suffering from low incomes and high prices. Not because they are choosing to patronise expensive options to fulfil their hunger and their needs.
Despite Federation of Malaysian Consumers Association’s (Fomca) continuous advocacy for food security, we continue to under-invest in food production, whereby our self-sufficiency is too low to meet demands for basic foods. More than RM50 billion is spent on importing food, resulting in high volatility of food prices, like now as our ringgit falls
Despite Fomca’s complaints over manipulation and monopolistic practices along the food supply chain, and confirmed by rigorous study on the food supply chain in the country by the taxpayer-funded Malaysia Competition Commission, which has clearly stated that excessive anti-monopolistic practices in the food supply chain is resulting in excessive profiteering and exorbitant prices – we just get lip service about cleaning up the food supply chain.
I do agree, minister, that there are young workers who rather spend their limited incomes on expensive bistros or latest smart phones or cars they can ill afford. For example, in a study by Fomca on young workers, 47% were excessively indebted. In a study by the Asian Institute of Finance on young workers aged 20 to 33, 70% were living beyond their means.
But I honestly believe that the B40 and increasingly the M40 are struggling to feed their families and to maintain some minimum level of financial security.
Prices are high because of low food production, dependence on food imports and price manipulation, not consumers eating expensive food. Your advice – if chicken is expensive, do not eat chicken, so maybe eat fish. If fish is expensive – do not eat fish. If vegetables are expensive – do not eat vegetables. What if powdered milk for babies is expensive? What are we to eat, sir?
Let me assure you, minister, that every suffering household knows where to get the cheapest food better than any official data. Of course if your advice is to be taken, consumers are expected to travel from market to market to find the best prices for each item. Is that really practical advice?
Honourable minister, please do not just listen to the official data; the Consumer Price Index and the Gross Domestic Product. There used to be a gap between policymakers and people on the ground. Today, that gap has grown into an abyss.
Talk to the rakyat! Minister, please listen!
Yet, sir you do have a point, in that consumers do have a role. With the theme “Change Begins With Me”, Fomca had run a national consumer campaign focusing on consumer education on what we would call “mindful consumption” and financial behaviour towards responsible consumption and responsible financial management.
Based on evidence, we believe that to some extent, we have changed consumer behaviour towards responsible consumption and responsible financial management.
But we need to invest in consumer education and financial education.
The government has a significant role in food production and regulation of the food supply chain. Instead of blaming consumers, the government should empower consumers by educating them on consumption and finances. – January 5, 2023.
* Paul Selva Raj is Fomca secretary-general.
* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.