Why are prices up? Minister Rafizi says consumers also partial driver of inflation
Economy Minister Rafizi Ramli told consumers bluntly today that they are also partly responsible for the continued rise in food prices in Malaysia, as he called for a “collective” effort to rein in soaring inflation.
The Pandan MP said analysis of inflation data showed a major factor driving prices up was the inelasticity of demand, a term economists use to describe a situation where consumers still buy the same amount of goods even as prices inflate.
Under mainstream economic theory, supply and demand becomes more elastic when consumer behaviour corresponds with price movements, meaning that demand typically drops as prices rise and vice versa.
“It has to be a collective effort,” Rafizi said at a press conference held to announce November’s inflation data.
“Of course, the government will play its role to address the supply side but we also need to start looking at tackling the demand side,” he added.
November’s inflation remained elevated at 4 per cent increase year-on-year compared to October but prices of food and non-alcoholic beverages continued to register an upward trend, staying above the 7 per cent range to become the lead component driving up the consumer price index.
Food and drinks make up the most of the average household income expenditure, accounting for up to 30 per cent according to official data. From this, over 11 per cent is spent on eating out.
“If you look at the inflation data (for the food component) the highest driver is cooked food,” he said, suggesting consumers spend a huge sum of their income eating out.
This sustained demand for eating out, according to the minister, allows eateries to continue selling food at an inflated price
A possible solution would be more competition and pricing transparency that could be made possible via a public benchmark, Rafizi added.
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Rafizi does not know that the population of Malaysia rises up yearly due to many births from one race and incoming of foreign workers.
With less money to spend, many Rakyat are on tight budget.
The Rakyat are FORCED TO BE COLLECTIVE IN BUYING FOOD.
THE MAIN REASON AND RAFIZI IS AWARE IS THE MONOPOLY AND APS IN MALAYSIA THAT CAUSES THE SOARING INFLATION.
CAN RAFIZI NAME ONE FOOD AND ITEM THAT IS NOT CONTROLLED BY CRONIES?
WITHOUT MONOPOLY AND APS, CHICKEN FEED CAN BE SOLD CHEAPLY.
WITHOUT MONOPOLY AND APS, VEHICLES AND FUEL CAN BE SOLD CHEAPLY.
WITHOUT MONOPOLY AND APS EVERYTHING UNDER THE MALAYSIAN SKY WILL COME DOWN BY 50%.
SO DON'T BE ARROGANT AND BITCHY JUST BY YOUR POSITION.
IT IS BECAUSE OF THE RAKYAT THAT YOU ARE AN MP.
IT IS BECAUSE OF THE RAKYAT THAT YOU ARE A MINISTER TODAY.
SO DO CHECK YOUR FACTS AND FIGURES AND STOP BLAMING THE RAKYAT WHEN YOU DON'T UNDERSTAND REALITY.
YOU HAVE ONE CHILD BUT OTHERS HAVE 7 CHILDREN.
YOU HAVE LOCAL WORKERS BUT OTHERS HAVE FOREIGN WORKERS.
EVERYTHING IS MONOPOLIZED IN THIS COUNTRY BUT YOU CHOOSE TO IGNORE IT.
TODAY YOU HAVE FORGOTTEN YOUR WORDS AND ACTIONS BEFORE GE15.
BLESS YOU.
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