The world is faced with the challenges and uncertainties, among them are the COVID-19 pandemic that began in Dec 2019, the Russian-Ukrainian conflict that begins on Feb 24, 2022 and threats of climate change such as floods drought in some countries.
Given these challenges, Dato’ Sri Tajuddin Abdul Rahman (Pasir Salak) raised the question in Parliament today on what action has been taken by the Government to address the economic challenge scenario for the sake of the welfare and well-being of the people.
In reply, Minister in Prime Minister’s Department (Economy) Datuk Seri Mustapa Mohamed said given the challenging global economic environment, The International Monetary Fund (IMF) has lowered the estimated world economic growth for 2022 to 3.2%. from 4.9% earlier. And, due to the challenges and uncertainties, the IMF has lowered its global economy growth projections for 2023 to 2.9% compared to 3.8% in January this year.
Although times are challenging, Malaysia has shown stronger growth of 5% in the first quarter and 8.9 percent in the second quarter of the year. This is supported by various strategies and initiatives under the Twelfth Malaysia Plan, 2021-2025 (RMKe-12), Budget 2022, the economic stimulus package and the reopening of national borders.
The Minister added the government is confident that the growth target of between 5.3% to 6.3% for 2023 will be achieved. In relation to this, the World Bank has raised Malaysia’s GDP growth forecast to 6.4% for 2023 compared to the 5.5% previously estimated.
Mustapa highlighted the economic indicators which showed an encouraging economic performance of the nation, which include;
– Total exports increasing by 30.3% to RM1.0 trillion between January-August 2023;
– The total sales of passenger and commercial vehicles increased by 63% to 447,209 units in January-August 2022;
– The number of tourist arrivals increased to 3.2 million tourists for January-July 2022 compared to only 57 thousand in the same period last year; and
– The unemployment rate recorded 3.7% in July.
The government is always concerned in looking after the welfare of the Malaysian Family (Keluarga Malaysia), said Mustapa, adding, these efforts that have been and are being implemented through an allocation of approximately RM80 billion for the provision of subsidies, assistance and incentives.
These include continuing to provide fuel and energy subsidies namely RON95, diesel and natural liquid gas.
The retail price of RON95 petrol in Malaysia is RM2.05 per litre is among the lowest in the world, lower than ‒ Qatar by RM2.7 per liter, Saudi Arabia as much as RM2.8 per liter and Indonesia as much as RM4.7 per liter.
He explained the government also provides some other assistance including, the Malaysian Family Assistance (BKM) amounting to RM8 billion. Until Sept 2023, as much as RM5.9 billion has been distributed to 8.7 million BKM recipients.
The government continues to control the estimated price of chicken and chicken eggs, and this initiative costs RM1.1 billion; and to control the price of packaged pure palm cooking oil.
The government also subsidized electricity tariffs amounting to RM5.8 billion for period July to December 2022 while the 1 kg packet cooking oil at the rate RM2.50 compared to the actual price of 1 kg of about RM7.
Aside from this, the Malaysian Family Cheap Sale Programme was expanded to all State Legislative Assemblies (DUN) and all Public Universities with price subsidies involving an allocation of more than RM100 million.
Mustapa said without the subsidy provided by the Government, the Department of Statistics Malaysia estimates the country’s inflation rate to be much higher reaching 10.6% compared to 4.7% in August.
He added the policies and Government initiatives have managed to restore the economy and lighten the family’s burden Malaysia.
“Malaysia, as a small and open economy is not exempt from being hit hard by these challenges and the steps to deal with them will be detailed in the Budget 2023.
