Despite growing economy, people just don’t have enough money

Updated 6 years ago · Published on 5 Feb 2018 6:39PM · 8 Comments

THE average consumer is unable to meet the rising cost of goods even as the country reports high economic growth.

This was the conclusion by local hypermarket boss Ameer Ali Mydin when analysing data on how hypermarkets throughout the country suffered low sales last year.

The slump in growth for hypermarkets, due to low sales, occurred as prices of more than 100 common foods shot up by 14% to 15% in the past five years, according to data from Mydin stores.  

“I think people just don’t have money,” said Ameer, managing director of the well-known Mydin chain of stores in an interview with radio station BFM.

Prices for these items went up between 2.7% and 3.7%. Last year, prices went up by 2.3%, Ameer said.

“On individual items, (the prices increases are) scary. For instance, cabbage from Cameron Highlands has gone up by a total 29% over the last five years.

“Ikan kembung hitam (Indian mackerel) 19%, Maggi brand Chilli Sauce 38.8%, Ayam brand sardines 30.6%.”

Ameer said the prices of these goods would also have gone up at competitors’ stores.

“If my prices go up, I’m sure my competitor’s prices would also go up. We are a market leader and we go up when our costs go up,” he said in the interview.

The rising price of goods have impacted sales at all hypermarkets, which he said accounted for 50% of all groceries sold in Malaysia.

In the first quarter of 2017, overall retail sales declined by 1.2% but hypermarket sales went down by 4.8%. 

The slump in the retail sector occurred while the country’s economic output of gross domestic product (GDP) grew by 5.6%.

In the third quarter, the retail sector shrunk by 1.1% while hypermarket growth declined by 5%.

“I am not denying that there is no (economic) growth because the numbers are there. But in a normal country, growth is domestic consumption.

“And the basic is food. But for hypermarkets and supermarkets, which control 50% of the market, (the growth is) negative.

However, Ameer said the ringgit’s improving exchange rate to the US dollar would hopefully bring prices down if the trend is sustained.

“The only silver lining is the ringgit has strengthened to the US dollar. Prices might come down in the long term.” – February 5, 2018.

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Comments

  • " ......100 common foods shot up by 14% in the past five years ..." - What? Hawker and restaurant food rose much more. Professionals (who have no time to cook) who eats out suffered the most. Not surprising Putrajays's kids are malnourished.

    Posted 6 years ago by Malaysian First · Reply

    • Economists will normally write glowing reports just to please their boss who in turn has to please their political masters. Who suffers because of all this misreporting? No need for three guesses.

      Posted 6 years ago by Brandy henderson · Reply

  • This is what I mean by intellectuals are actually very stupid people. They might have been smart once, but then they kept on forcing themselves to be stupid so that they can keep their job or get promoted or basically satisfy their egoistical desires, until at one point , they didn’t have to force themselves to be stupid anymore - they were just naturally stupid. Its because they are down right stupid that an intellectual like an economist can predict that the country’s economy is doing well and expected to be better in the future, when on the ground their predictions and calculations and a measurement misses reality by a wide margin.

    Posted 6 years ago by Nehru Sathiamoorthy · Reply

    • It is not stupid. Economics is an art not a science. There are just too many ramifications. Of course many of our economists are substandard or biased and not well known for their economic acumen, a result of our racist policies.

      Posted 6 years ago by Malaysian First · Reply

  • " ..... the country reports high economic growth ...." ..... - .... it only benefited the rich tycoons and businessmen while the common folks, middle class and the poor are saddled with an unwanted by-product .... high inflation.

    Posted 6 years ago by Malaysian First · Reply

  • Ilan kembung up only 19%?? Even for 2017 alone, it's too low.

    Posted 6 years ago by Bigjoe Lam · Reply

  • All already pocketed by the politicians! When not enough, they buy land at $1 and sell $100 to foreign countries!

    Posted 6 years ago by Fun fun · Reply

  • Regarding the economic problems facing lower income group I have to agree with smart Alex Mazlan on how to react when you have limited resources. I recall him encouraging ppl to grow their own veggie which incidentally I have done so at every available space in my small two bed rooms house Meanwhile I have nasi goreng daily with different flavours. I am so grateful to the government of the day.

    Posted 6 years ago by Joseph Ally · Reply