Friday, October 15, 2010
2011 Budget - Towards a High Income Nation.
Can't we manufacture utility equipments like these?
Everything looks so rosy and promising in the 2011 budget. While listening to the PM's speech proposing the budget, we can hear our Parliamentarians banging their desks repeatedly with glee. All Menteri Besar's seem to be very happy and full of praises for the budget ( or PM?). But nothing in the Press (at least for today) from the MBs from Pakatan Rakyat with the exception of Kedah if I'm not mistaken. All praises and kudos.
I'm as happy as everyone else about the budget, about what it promises. The biggest raise in salary and allowances (in aggregate terms) perhaps is for the Chairmen of JKKKKs and Village Heads (Ketua Kampung) and the Tok Batin.. Almost a 100% increase (double the amount) and the allowance for each meeting is raised to RM50 or so. Ten meetings would give an allowance of RM500 which added to the salary of RM800+ would give a total of about RM1300. That's a whopper and how many thousands of them do we have in the country? But with the increase in the number of small village projects triggered by the Government Incentive Package of RM67 billion, the spill over from the little little projects which are given to the villages can amount to quite a fortune. That is even more income-boosting than the allowances.
With a rise in the income of people within a nation, the obvious danger is INFLATION. The budget says it is expected to increase to 4% and aside from the launching of a Website where consumers can report on any matter relating to the prices and availability of consumers goods, the budget is silent on what steps are being taken by government to curb spiralling prices. One needs only to check on the prices of their teh tarik, nasi lemak, roti canai, and many other food items in the menu of their favorite restaurants to see the changes in price. Go to a retail shop or store with RM50 and see what you can buy. You'll get more if you go to a supermarket.
With the budget going into trillions, the basket of goods that RM10 can buy in Malaysia seem to shrink although the parity value of the ringgit seems to stay or even go up. I use an RM10 measure for RM1 is incapable of buying even a loaf of bread , a nasi bungkusor a newspaper. Higher income doesn't mean much if it can buy less than now. It will just be a money illusion.
Another significant fact mentioned in the budget is that while export goes up by 22%, import increases by 28%. This seems to spell a negative trade balance. Are we buying too many things from outside with the import of capital goods rising by 18%? Aside from buying heavy equipment can't we manufacture more of the things we need? What happens to the policy of import substitution? If we're to transform the economy of the nation, let's manufacture many more of the things that Malaysians need rather than import them. With multitudinous housing projects springing up in the country we need a big number of motorized lawn mowers, small ones that we can ride on. Can't this great country manufacture that? Now. even the the swinging-blade type must be imported!
I think there're so many things that Malaysia should produce itself. Stop depending too much on foreign import. Unless the number of factories increase dramatically, how are we going to employ the increasing number of skilled and better educated manpower that we want to produce. The market demand for them must be stepped up for only that will ensure that they will be employed at a higher salary.