Protect Consumers From Potential Black Market Surge

KUALA LUMPUR, 26 NOVEMBER 2021 – Greater enforcement effort from the authorities and a robust consumer education campaign are critical to stemming the expected increase of black market goods, resulting from the increasing cost of essential goods and income crunch faced by Malaysians currently, said a global consumer advocacy group, Consumer Choice Center (CCC), in a statement today.

The comment from CCC came following the recent news reports that coffee shop operators were forced to increase their prices in tandem with the price increase of essential products like condensed and evaporated milk, sugar and plastic bags, which eventually led to the rise in their operation cost. 

Fred Roeder, Managing Director of CCC, said, “The spike in prices of essential items may be indicative of broad-base inflation setting in as a result of the low-interest rate regime. This can be problematic as household incomes have not recovered from the impact of the COVID-19 crisis and income stretched consumers will naturally turn to cheaper alternatives for their everyday goods and services.”

“We believe that criminal syndicates will seize this opportunity to bolster the supply of black market products into the Malaysian market, and they would be enabled by the opening of borders between states and very soon, countries.

“Apart from household essentials like rice and cooking oil, we foresee an exponential influx of illegal cigarettes into Malaysia. Surprisingly, even prices of illegal cigarettes, which currently commands close to 60% of market share, has risen significantly and enriching criminal syndicates with even higher margins.”

“Nevertheless, the price difference between legal and illegal cigarettes remains extremely wide due to Malaysia’s high tobacco excise duties. 

Fred suggested the Government strengthen enforcement measures, be it stricter legislation or adapting new and improved technology. All in all, think outside the box to explore new ways to combat the black market and protect consumers with better quality and safer products.

In addition, Roeder said that the Government must act now to stem further leakages to the black market. While the Buy Malaysian Products campaign can reinvigorate the retail sector, there should also be a nationwide campaign to educate consumers against buying contraband products.