THE Institute of Strategic Analysis and Policy Research (INSAP) has lauded the government for recently inking 14 memorandums of understanding (MOUs) with China which will see both countries share expertise and best practices, and collaborate in various fields.

The think tank said this milestone underscores the importance of the multilateral trade system and mutual interdependence, particularly with the Red Dragon of Asia.

However, INSAP said while this diplomatic landmark highlights the strategic importance of the country’s relations with China, it should also be acknowledged that many Malaysians are not as enthusiastic about the achievements.

“This is not due to the insignificance of China but rather because Malaysian themselves are currently experiencing challenging times - at least domestically,” it said in a statement on Wednesday (June 26).

INSAP contended that despite these promising headlines from the inked MOUs, many ordinary Malaysians continue to face significant domestic challenges and would argue that these rosy figures often translate poorly into everyday economic challenges.

It said these challenges or “pinch” reflects primarily in the rising cost of living whereby costs of essentials from food to healthcare have soared at worrying rates.

“UCSI Poll Research Centre highlighting earlier this year that close to 90% of Malaysians are deeply troubled by the current uptrend in living costs,” it noted.

“Purchasing power of Malaysians has also further eroded due to the rationalisation of fuel subsidies, expansion of tax structures, and surges in utility tariffs.

“While INSAP acknowledges the necessity to alleviate fiscal pressure and stimulate economic growth, current policies often seem to prioritise enhancing economic indicators over the rakyats’ well-being.”

The think tank said the administration approach to economic growth appeared to be one-size-fits-all rather than a phased and targeted implementation that would allow the people some breathing space.

“For instance, a comprehensive tax system like Goods and Services Tax (GST) which, based on consumption, could have been reimplemented rather than introducing new taxes and increasing existing tax rates to plug Sales and Service Tax (SST) shortcomings.”

INSAP further pointed to worrying international benchmarks, among them the dip in Malaysia’s Programme for International Student Assessment (PISA) 2022 score as well as the recent International Institute for Management Development (IMD) World Competitiveness Ranking.

“INSAP believes the administration must start to strengthen domestic economic resilience,” it remarked.

“This is essential before looking across borders as to provide a stable foundation for international partnerships and foreign investment which should positively impact the people’s lives rather than just producing good statistics.” - June 26, 2024

https://focusmalaysia.my/malaysia-china-mous-great-numbers-but-what-does-it-mean-for-the-people-asks-insap/