At last, someone is speaking the truth: Mydin boss spills it out on Malaysians having little money to spend!
Mydin managing director Datuk Ameer Ali Mydin said on BFM yesterday that Malaysians do not have enough money to spend on groceries.
Mydin seems to be one of the businessmen who believe the impressive gross domestic growth recorded in Malaysia lately did not translate into the success spilling into the pockets of the public in general.
This view is contrary to what the government is saying on a regular basis: that is Malaysia is growing fast, strong and that everyone should be happy.
Many people has pointed out that inflation has impacted their marketing budgets, and that the goods and services tax (GST) is to blame for their predicament.
However, the authorities have remained adamant over the years that both the inflationary pressures and the GST did not impact the pocket of the citizens. For some, it is even laughable to think that this is possible.
Mydin pointed out that the impact of the lack of money in the pockets of Malaysians for marketing could be seen in declining hypermarket sales across the country throughout 2017.
Hypermarkets and supermarkets, which control 50 percent of the grocery market are experiencing negative growth making Mydin wonder on the country’s real economic growth.
“That makes you wonder, how can a country grow but hypermarkets growth, which is the real basic consumption in the country, is negative.”
In the first quarter of 2017, Malaysia’s GDP grew by 5.6% but retail sales dropped by 1.2% while hypermarket sales went down by 4.8%.
He said, “I am not saying there’s no growth, of course, the numbers are there. But in a normal country, growth will reflect on domestic consumption (basic goods).”
Malaysia is said to be very dependent on domestic expenditure (which is at the core of the government’s economic policies) but with the massive expenditure, the people are still not spending.
Economists who spoke to WFTV said the only way for Malaysia to escape any challenges in 2018 is to boost its domestic spending since the country will be dependent on consumption growth.
However, the assessment by Mydin’s boss is clear indication that the money is not circulating among the population, but among the few builders and businesses supported by the government, said an analyst to WFTV.
In the third quarter, the retail sector shrunk by 1.1% while hypermarket growth declined by 5%. Even though the fourth quarter numbers are not out yet, Mydin said that the trend will continue.
According to data from Mydin stores, the prices of 150 goods have increased by more than 14% on average in the last five years
Mydin also shared some example of food prices which have shot up tremendously. Cabbage from Cameron Highlands has gone up by 29%, ikan kembung hitam (black mackerel) 19%, MAGGI Chilli Sauce 38.8%, Ayam Brand Sardines 30.6%.
“And you can say six percent may be because of the goods and services tax.”
“The only silver lining is the ringgit has strengthened to the US dollar.”