KUALA LUMPUR, April 3 — Malaysia’s structural reform efforts should be expedited and require a comprehensive strategy to prevent leakages, said Bank Muamalat Malaysia Bhd chief economist and head of social finance Mohd Afzanizam Abdul Rashid.
He also said that financial assistance should be channelled to the targeted groups as a buffer for the reform programmes implemented while reducing the side effects on the people.
Mohd Afzanizam said although there would be side effects if subsidy rationalisation were implemented, such as the impact on prices of goods and inflation, such measures need to be taken to deal with the uncertainties of the global market, including fluctuation of the ringgit exchange rate against the US dollar and global oil prices.
“The time has come for structural reforms to be implemented as soon as possible because it is feared that the cost of implementing it will increase. The longer we wait, the more we will miss the opportunity.
“So, government initiatives such as cash assistance and so on would act as a buffer to the subsidy rationalisation programme which is a short-term absorber when policy changes occur,” he said after the Malaysian Economy Forum event organised by the Malaysian Economic Association, here today.
He added that engagement sessions should be held so that the people are aware of policy changes and side effects if structural reforms were carried out.
“Engagement sessions need to be organised so that information can be channelled more clearly and enable the public to make preparations and be more positive to accept the implementation,” he said
Commenting on agricultural and food sector reforms, Afzanizam said a comprehensive guideline must be established to drive the country’s agricultural industry and at the same time, address the issue of imported foods.
He said the value of agro-food imports into Malaysia soared to RM75 billion in 2022 from RM64 billion in 2021.
“If imports can be reduced by 10 per cent, we will achieve a spending reduction of RM7.5 billion.
“Currently, one of the problems is the overlapping of jurisdiction and responsibilities between agencies,” he added.
Meanwhile, the Retirement Fund (Incorporated) deputy president and economist Sendi Anak Tan said Malaysia should bolster its relationship with Asean food-producing countries to effectively implement agricultural and food sector reforms.
“Thailand is a rice producer, Indonesia also produces palm oil, among others, while Vietnam and Myanmar are also food-producing countries, including rice and fresh vegetables as well as sugarcane (sugar),” he said. — Bernama
