Communications Minister Salleh Said Keruak is suffering from severe paralysis in economic thinking.
His projected economic growth of 5.5 percent may look impressive but what does it mean to the poor who are forced to borrow money to feed their families?
With the projected growth, Salleh has placed the country in the ‘superb’ category and accused the Opposition of spin-doctoring the fact that Malaysia is on the road to bankruptcy.
But let me introduce Salleh to the “Other Malaysia”, if he doesn’t know it already.
A Malaysia where the poor are unable to buy a house, pay their medical bills and are either jobless or have very low-paying jobs.
In 2016 while most of the country’s growth was enjoyed by the rich and middle classes, the poor – termed as bottom 40 (B40) – could barely muster any savings.
Wages and salaries grew less than one percent or about seventeen ringgit in real terms, according to Bank Negara.
The income increase of the top 20% was nearly seven times compared to the increase in income of a B40 family, based on the Household Income and Basic Amenities Survey 2016.
On average, the income of a B40 family went up by RM275 while the salaries of the top 20% (T20) went up by nearly RM1,800 last year, close to double the minimum wage in Malaysia.
In fact, the increase in income for the top 20% was also more than double of the income increase for the Malaysian middle class.
In terms of savings, a family in the B40 category could only save RM54 a month, while the average family in the top 20% could save at least RM820, while the M40 managed to save some RM365 monthly.
The top 0.4 percent or 28,727 members have a total EPF savings of 47.2 billion ringgit.
In sharp contrast the bottom 51.9 percent, which is 3.6 million members, have a total savings of 43.9 billion.
This means that the chunk of the EPF savings remain in the hands of a few rich folks.
So, it’s a double whammy for Malaysia’s poor as they barely saw an increase in salary and don’t have enough to save for an emergency.
But that is not all.
The B40 only have 16.4% of national income share, showing that Salleh’s claim of Malaysia’s superb economy is misplaced, as the beneficiaries of this growth are only the rich.
These numbers clearly show that the country suffers from a huge inequality between the rich and the “Other Malaysia”.
This proves that it is indeed Salleh who is a spin artist or he simply has a very shallow understanding of economics.
At a time when the economy is approaching stagnation with an oversupply of houses, retail outlets and other goods with no demand to match it, the government must look at increasing wages.
That requires a more skilled workforce along with higher quality, higher paying jobs.
Otherwise, the government’s paralysis in economic thinking will be worsened with the likes of Salleh who continue to prop up empty, meaningless numbers.