A group of children in Raub, Pahang, watch cartoons on a tablet.
Malaysia's poverty rate is lowest among its peers in Southeast Asia at
3.8pc. Source: Shutterstock.
SO MUCH – perhaps too much – has been said of late about matters
pertaining to poverty incidence and income or wealth disparity in
Malaysia.
These commentaries, even when looked at objectively, can shine through
to even the most politically apathetic among us as mere rhetoric
parroted by parties and groups intent on pushing forward an
opposition-leaning agenda.
But cut through the noise, look at the facts and it becomes easier to
see how and why Malaysia has become something of a model nation among
its Southeast Asian peers for poverty eradication.
Let’s break it down:
In just a little over 60 years, Malaysia has transformed itself from a
low-income agricultural-based economy to a nation on track towards
attaining advanced economy status in two years’ time.
Among its achievements in national development, Malaysia lays claim to a
pretty remarkable decline in poverty rates and remains an example of
poverty reduction in Southeast Asia.
Why? Results and data have shown that efforts by the government to
promote equitable opportunities for all and grow the local economy have
achieved its desired results.
The Central Intelligence Agency (CIA) World Factbook 2017, for example,
has reported that Malaysia’s poverty rate is the lowest among Southeast
Asian countries at 3.8 percent, as compared to Vietnam and Indonesia
(11.3 percent), Thailand (12.6 percent), Laos (22 percent), the
Philippines (25.2 percent) and Burma (32.7 percent).
The report also highlighted that Malaysia’s per capita gross domestic
product stands at US$27,200, which is far better than those of its
regional peers in Thailand (US$16,800), Indonesia (US$11,700), the
Philippines (US$7,700), Vietnam (US$6,400), Burma (US$6,000) and Laos
(US$5,700).
Meanwhile, arguments claiming Malaysia’s wealth gap or Gini coefficient
has grown are not backed by fact. Quite the contrary, the country’s Gini
Coefficient fell to 0.399 in 2016 from the 0.401 registered back in
2009. This puts Malaysia on much better footing than some advanced
economies such as Singapore (0.458) and even Hong Kong (0.539).
Malaysia’s Gini Coefficient has improved over the years. Source: Shutterstock
According to one of the most recent reports by the World Bank, Malaysia
has had an inclusive economic growth rate of about 7 percent annually
for the past 25 years.
Since this growth has been inclusive, Malaysia has been successful at nearly eradicating poverty in the country.
Nonetheless, with the rise of new forms of poverty particularly in urban
areas brought about by mass and rapid urban migration, there is
admittedly still plenty to be done for Malaysia to attain its
zero-poverty target.
Wary of this, the government, together with various stakeholders,
continues to build on its national policies and plans, implementing
numerous initiatives to help raise the incomes of the urban poor and
vulnerable groups.
These can be divided into two main categories: short-term and long-term.
Short-term initiatives
Aiming to address the immediate needs of the urban poor, numerous aids and subsidies have been made available, including:
Bantuan Rakyat 1Malaysia (BR1M)
Introduced in 2012, BR1M is part of the Economic Transformation Program
(ETP) to assist low-income earners in Malaysia. The aid (a yearly,
one-off cash payment of RM500) aims to reduce the cost of living amongst
households with less than RM3,000 monthly income.
Other financial aids
Eligible single mothers, the disabled, senior citizens in need as well
as low-income households are also provided with a number of financial
aids to help ease their burden.
These aids come under the purview of the Women, Family and Community
Development Ministry and Department of Social Welfare Malaysia.
Long-term programmes are also in place to equip the underprivileged with
the necessary knowledge, skills and/or capital to become more
financially independent in the long run. These include:
1Malaysia Programme
A nationwide ongoing programme with multiple initiatives to help ease
the burden of the poor. Initiatives include Kedai Rakyat 1 Malaysia,
PR1MA affordable housing scheme, KAR1SMA social assistance programme and
Program Susu 1 Malaysia for school-going children.
2 Years Exit Programme (2YEP)
Introduced in 2010, 2YEP provides temporary welfare assistance to
eligible candidates over two years whilst helping them to build on their
abilities. After 2 years, the candidate is expected to be able to live
independently without relying on subsidies. To date, 2YEP has helped 122
hardcore poor people, including those with disabilities to come out of
poverty.
Transformative Education Policy
The Government has long been committed to provide free education for all
Malaysians, free textbooks in public schools, continuously transform
the education system and provide scholarships to further boost the
social and economic standing of all races. Malaysia is unique in the
sense that it provides a vernacular education system (Chinese and Tamil)
to cater to the specific needs various communities in the country.
Simply put, poverty eradication is a challenging and continuous process. And the simple fact is there are no quick fixes.
The hope is that these holistic programmes will serve to lift those
concerned out of poverty, empower them and in time, help them become
active participants in Malaysia’s economy.
* V. Paramasivam as a former director in a Malaysian think-tank focusing on national and international issues.
** This is the personal opinion of the writer and does not reflect the views of Asian Correspondent
