Putrajaya continues to impose price controls and subsidies in the belief that they will lessen the impact of food inflation. Given that Malaysian families have one of the highest levels of household debt in the region, many were forced to re-evaluate their expenses. The proportion of household budgets in low- to middle-income countries allocated to food expenditures often ranges between 30% and 60% of average spending.
Meanwhile interest rates, which mean higher mortgage repayments, went up four times from 1.5% in 2021 to 2.75% in 2022, further impacting on household spending. Malaysian average salaries and wages are too low, with growth at an average increment of RM140 per year between 20. In 2019, the median wage was RM2,442 compared with RM2,250 in 2021. During that same period, the cost of staple food items like eggs and poultry jumped by 23% and 20%, respectively.Īlthough the cost of food has gone up, personal income has yet to return to pre-pandemic levels. This could be a worsening sign of the food inflation crisis, which rose to a record high 7.3% year-on-year in November 2022, as opposed to 2.7% during the same month in 2021. Malaysians consume a staggering 2.5 million bowls of Maggi mee daily or 912.5 million each year. Nestlé Malaysia’s Maggi was the eighth out of 10 most common household items in homes. According to a recent study by Kantar Worldpanel, a market research firm, 85% of Malaysians cooked more at home during Covid-19 and 46% expected to do so in the new normal, with time and cash-strapped parents turning to instant noodles for family meals. WHAT used to be an unhealthy trend among cash-strapped students, the consumption of instant noodles is growing. Scrapping subsidies, controls could bring down prices of essentials in long run
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