DAP condemns the government’s indifference towards the depreciating ringgit which recently dropped to a new 24-year-old low of RM 4.65 to the US dollar. The government justified the ringgit’s decline as no big deal because other currencies dropped more or that the ringgit decline was only temporary in nature. This is wrong and dishonest, completely overlooking the financial hardship faced by the rakyat and businesses with a weak ringgit.
The ringgit’s decline is not temporary when it has continuously dropped in value against the US dollar by more than 11% year to date since 1.1.2022. The ringgit has also declined against the currencies of our major trading partners by more than 4% against the Indonesian rupiah and dropped to a historic low of RM 3.26 to the Singapore dollar. Further, how can the drop of the ringgit against the US dollar be no big deal when 80% of our exports and imports together are invoiced in US dollars?
Malaysia’s services trade recorded the highest deficit ever of RM60.7 billion in 2021. The weak ringgit will definitely have an impact on sharpening the services trade deficit this year. Bear in mind that our food import bill amounted to RM63 billion last year and the ringgit’s 24 year old low against the US dollar is definitely a big deal with a negative impact on food prices paid by the rakyat. But all these concerns of the rakyat demanding solutions from the government leaders are drowned out by the shrieks and screams for an early general election this year.
UMNO’s statement yesterday entirely focused on holding the general election this year at all costs, callously ignoring the economic distress and livelihood hardship faced by the rakyat and businesses, especially SMEs. Nothing is mentioned about prioritising aid to those adversely affected by rising prices and a depreciating ringgit and ensuring that all resources are pooled to face severe floods expected during the current monsoon season.
UMNO has missed a golden opportunity to demonstrate they have the people’s interests at heart by not castigating the failure of Annuar Musa to rein in inflation in his capacity as Chairman of the Special Cabinet Task Force on Jihad Against Inflation. At the very least UMNO should have demanded that either Annuar resign or request that the Prime Minister Ismail Sabri take over as Chairman.
Annuar became Chairman in June, when the Consumer Price Index(CPI) and food inflation was at 3.4% and 6.1% respectively. After 2 months, the CPI and food inflation did not recede but rose instead to 4.7% and 7.2% respectively in August, demonstrating Annuar’s ineffectiveness and incompetence as an inflation fighter.
Following Annuar’s failure to stem inflation, Bank Negara has increased the Overnight Policy Rate(OPR) by 25 basis points to 2.5%. The people must pay higher borrowing costs due to Annuar’s failure and worst is yet to come. Bank Negara has no confidence in Annuar’s ability to fight inflation and is expected to increase the OPR in their next two meetings in November this year and January next year to at least 3% or higher. Does UMNO care that the people have to pay more?