Malaysia’s sharp decline to No 32 in the 2022 International Institute for Management Development (IMD) World Competitiveness Ranking (WCR), down by seven positions from 25th in 2021 is a clear warning of the failure of good governance by the Ismail Sabri administration. The drop in Malaysia’s competitiveness reinforces the need to heed warnings of the lack of governance competency, certainty, consistency and clarity to replace prevailing policy complacency, confusion and flip-flops.
This latest competitiveness report does not augur well for the Malaysian economy buffeted by soaring prices and high cost of living, rising corruption, acute labour shortages, weakening ringgit, government red-tape, traffic jams and communications congestion. At a time when the ringgit should be strengthening with high oil prices and soaring commodity prices especially oil palm, the Malaysia ringgit has dipped to record lows against the US and Singapore dollar, two of our three largest trading partners.
The government should wake up by establishing a Price Stabilisation Fund and a Buffer Stockpile of essential commodities to moderate price escalations and fluctuations. At the same time, abolition of food import APs should not be accompanied by increased red tape that slows down processing time. Further, subsidies should be promptly disbursed and not delayed like the chicken meat subsidies where out of the RM730 million approved by the Malaysian Agriculture Food Industries(MAFI), only RM50 million was paid at the end of May.
Labour shortages have haunted many businesses with many establishments operating below capacity. Unless this is quickly resolved, economic growth would be adversely affected.
The government should stop being in the denial syndrome by claiming that inflation is under control at 2.3% when this is due to controlled prices. A more accurate reflection is by looking at the Producer Price Index which was at 11% in April. The Prime Minister should direct his Ministers to go down to the ground to get a realistic assessment by visiting markets instead of going for overseas trips.
Lim Guan Eng
DAP National Chairman
MP for Bagan