Malaysia: Point of concern, Limits to growth

The biggest concern for Malaysia has been its growth rate and our analyst asks how much of the small growth is shared with the masses

Malaysia: Point of concern, Limits to growth

By Sharifah Azzahra, Certified Risk Advisory, Selangor

The nation has to understand that we are very concerned with our ability to grow hence the continuous discussion on economy and trading and its link to the current situation (hung parliament) is very much emphasised by not just Awani but everywhere in the media. Why do we as a nation believe that the vote we have cast will not limit us to growth?

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Understanding the growth problem

For several months, the nation has reacted to the possibility of facing a serious risk of inflation. That debate has focused largely on the OPR movement or interest rate — especially on whether BNM has been too aggressive in increasing the money supply, whether the movement of interest rates is too high or low, and whether it can be relied on to reverse course if signs of inflation emerge.

So far the decision is mostly on keeping the interest high to encourage saving however, is that successful? No, because we keep on mentioning that our growth is very much dependent on domestic demand, hence debt is rising domestically too, indicating that the system fails to achieve its objective.

Thus, people remain unhappy as people have started to realise that even though the government produces growth in GDP, it is a cost to the environment and society, people are still struggling, and the personal economic situation of the middle class and the poor is worsening. They do not experience the recovery and small growth that the government, analysts and economists are preaching about. Indicating real personal wealth is going down.

The PRU15

As the country can no longer produce significant new real wealth, those with power can only improve their position by using it to commandeer the wealth of others. Wealth gives power. Power gives the ability to wrap the economic and political system in ways that permit even more concentration of wealth. Hence creating bigger inequality. This is proven when at the end of that day it was Zahid Hamidi in a way determining who is the prime minister.

Democracy?

The democracy we have is very much motivated by a positive view of the future. At the onset of a declining phase, an honest and objective appraisal will not support the view. During the campaign session, most of the parties did not mention the reality the economy is facing, we are not booming, and we all know that next year will be tough and it is very hard to repair, hence the drift towards magical thinking, thinking that assumes solutions will emerge as opposed to the real reality is very much celebrated during the PRU15 campaign season.

As a nation, I view this as a violation of democracy. Today marks the failure of democracy because, at the end of the day, the voice is still not heard. The corrupt is still part of the government, the reality of the economic situation is still being hidden from the public eye, the new faces are still not there, the nation is still divided and the poor will remain poor and the middle class will continue to struggle.

Solution

Given the failure of democracy, the nation has to take solutions to their level. Spend less, equipped yourself with knowledge. Respect the poor.

For the politician and analyst, be honest.