Fighting inflation in the long-term

LIKE the rest of the world, Malaysia is suffering the effects of inflation.The Russian-Ukraine war being fought amidst a still ongoing pandemic is affecting supply chains badly, especially of food and fuel.

While Malaysia is cushioned slightly because we export fuel, nothing protects us from rising food prices.

Those have escalated in the past year, with consumers having to fork out between 10% and 40% more to eat, especially when dining out.

The country’s current inflation rate is 3.3%, but food inflation is at 7% – and we are all feeling the pain of these numbers, no matter what our income level.

For the most vulnerable, it’s becoming a battle to just put enough food on the table.

Today, there is little we can do with the RM50 in our pocket what with something as basic as a bottle of 5kg cooking oil costing at least RM30.90.

While the government has responded to the rising cost of living by raising the minimum wage, imposing price ceilings on essential goods and offering subsidies, such measures can only be temporary – they are not sustainable in the long run.

In the long term, the government must address basic issues that contribute to inflationary pressure and find means to protect the country from global shocks.

For one thing, Malaysia depends way too much on imported food: nearly 60% of our food comes from outside the country.

The security of being able to produce staples such as rice and vegetables ourselves without putting additional pressure on imports is one long-term measure the government must work on.

Malaysia, like much of the developing world, has long focused on industrialisation and producing commercial crops for export.

In fact, Mardi, the Malaysian Agricultural Research and Development Institute, was a regional leader in developing agricultural products for export; perhaps it could now be repurposed to look into increasing local production of food crops instead?

It’s not like we don’t know how to drive agriculture; we have, after all, become one of the world’s largest producers of palm oil and rubber (pity we can’t eat them).

So why can’t we at least produce enough rice and vegetables for local consumption even if becoming an export behemoth like India – which supplies a whopping 40% of the world’s rice supply – is not on the cards for now.

One thing we consumers can do to survive in the meantime is to buy local as much as possible.

This will not only help our pockets but also give local demand a boost.

Maybe even enough for our food producers to realise that there is profit to be had in meeting the local demand.