GLOBAL inflation has emerged as a major threat to the world economy. John Lipsky, deputy managing director of the International Monetary Fund (IMF), said "inflation concerns have resurfaced after years of quiescence" due to soaring food and energy prices.

Oil prices have hit new highs, reaching US$127 (RM414) a barrel, an increase of 99 per cent in just the last 12 months. Analysts and commentators are forecasting that it will touch US$200 a barrel. The days of "cheaper" oil are gone. The world has to learn to live with higher energy prices. It also means that consumers around the world must adopt more cost-efficient measures.

Then again, food and commodity prices have also increased and grain prices are hitting new highs, prompting governments around the world to seek ways to cap them and ensure adequate food supplies at affordable prices. Lipsky says the forces pushing prices up "appear to be fundamental in nature", and these are being amplified by lower US interest rates and the decline of the greenback.

The IMF stressed that policymakers must respond "aggressively" to any sign of rising inflation expectations "lest the impressive gains in global stability attained in recent years be sacrificed".

It is no different in developing countries. Malaysia, too, is not spared - energy and food prices are also on the rise. The government has set up a cabinet committee on inflation. It is working to draw up policies to cushion the impact of global inflation and rising energy prices on the consumers especially those in the lower-income group.
The measures to ensure sufficient supplies of rice and to keep a lid on prices have been announced. While the authorities have come out with the measures, these will only yield the desired results if there is co-operation from all parties concerned - including consumers, millers, wholesalers, traders and retailers. It is not a job for the authorities alone.

The fight against inflation does not end here. It is going to be a long haul. It is a global phenomenon and inflationary pressures from other countries are also being "exported". There is imported inflation over which governments have very little say or control.

But they cannot just sit back and do nothing. Food security is essential. Many countries around the world have realised that lack of food security can lead to destabilising government and political turmoil. Governments have been overthrown. The current food shortages and rising food prices led to former Haitian prime minister Jacques Eduard Alexis losing his job.

In Malaysia, Prime Minister Datuk Seri Abdullah Ahmad Badawi warned that the Barisan Nasional government can fall if it fails to tackle the food crisis and inflation. It does not matter that it is a global phenomenon. At the end of the day, all politics is local, and in this case, hungry and angry locals do not care what happens in the rest of the world. They expect the elected government of the day to ensure that their basic needs are provided for, they have a roof over their heads and do not go to bed hungry.

The cabinet committee on inflation has announced several measures to ensure adequate supplies of rice and to cap rising prices. The measures are estimated to cost the government an additional RM725 million. Increased allocations to help the food and agricultural sector have also been announced.

The government will spend RM45 billion on fuel subsidy this year. At this level, the amount spent on subsidies will be higher than the annual RM40 billion budget for development in the Ninth Malaysia Plan.

Even though this is high, the prime minister said: "As the government, we will try our best to ease this burden. We will not allow this problem to grow. We cannot wait and see any more. We have the political will to act to ease the burden on the people."

The government has allocated RM4 billion to provide for sufficient food supplies. The people must also help themselves and help the government to help the rakyat. While immediate steps have been announced, it is important that enforcement is also stepped up.

With the price differential of the staple food crop between Malaysia and Thailand, for example, there will be increased temptation to smuggle Malaysian rice out for quick gain. It is already happening. Local millers and traders must play their part, as should the sole importing rice agency, Bernas, in ensuring the government's efforts are not undermined.

The Asian Wall Street Journal in a report on Monday listed ways to cut food prices. Among the measures: stop hoarding. The report refers to nations that have imposed export controls to cater to their own domestic demand, but the reminder also applies to the Malaysian domestic scene.

Every time the prices of commodities rise, especially of essential items, supplies suddenly decline or disappear due to hoarding as traders anticipate higher prices and gains in future. This then means insufficient supply to meet current demand.

The other proposal is to buy local. Malaysia had a campaign some years ago to "Buy Malaysian".

While in the current situation, Malaysia is a net importer of rice and food items, it might be wise to increase domestic food production. There is a plan for more rice-growing areas in Sarawak. But that is a long-term plan.

Some pressure on home expenditure can be reduced by growing vegetables on small plots of land. It is not impossible to grow vegetables, even in urban areas. A Malaysian couple, who lived in New York City for some 40 years, used to grow their own chillies, tomatoes and brinjals on their roof top - and in an environment where the growing season was only a couple of months. In Malaysia, the growing season is all year round.

All it requires is determination and perseverance to deal with current food supplies, prices and inflation.