THERE is much work to be done to close the gap between the rich and poor, and relevant issues must be looked into before implementing policies on spurring the sharing of wealth, experts said.
They agreed that the income disparity between the Bottom 40 (B40) and Top 20 (T20) income groups was vast and needed to be addressed to create a healthier economy.
Prime Minister Tun Dr Mahathir Mohamad had recently noted that the gap between B40 and T20 group households had widened from RM2,000 in 1990 to over RM10,000 in 2016.
Policy, strategic and management expert Dr Faridzwan Abdul Ghafar said among the issues that contributed to the disparity were the slow progress of economic development, education and infrastructure in poor states.
“These (issues) lead to problems concerning access between rich and poor states.
“The government needs to focus on developing poor states and set an action plan to transform the demography of the poor population so that they will not remain centred in a region,” Faridzwan said.
Should the problem persist, Faridzwan said, it would create long-term problems, such as an increase in crime, malnutrition and lack of access to education and medical services.
“The widening income gap will lead to an economic downturn. It will make right-wing politics become extreme and gain a foothold in the mainstream political scene.”
He added that it would also inflame racial tensions.
“The Bumiputera/Muslim product campaign is a manifestation of a worsened income gap. A similar situation took place in German after World War One when extreme racial and religious politics became mainstream.”
Universiti Sains Malaysia’s Dr Ainul Adzellie Hasnul is upbeat that the Shared Prosperity Vision 2030 (WKB2030) economic blueprint will address the income disparity.
Unlike the National Economic Policy, which dealt only with issues affecting Bumiputeras, Ainul said, WKB2030 was a roadmap that went beyond race.
“The spirit of WKB 2030 is its inclusiveness, which is aimed at providing a decent standard of living for Malaysians.
“It is not exclusive to a certain race or state. Malaysians will benefit from development programmes as the nation progresses and prospers.”
Ainul said the private sector and the people needed to play their part in ensuring that all the 10 targets outlined under WKB2030 could be achieved.
“The private sector can play its part by increasing wages so that it is not only appealing and lucrative, but also provide people with greater purchasing power.
“This will not only bridge the income gap (between the B40 and T20 groups), but also stimulate the economy. However, providing lucrative salaries must also translate into higher productivity as this will ensure the nation’s healthy
and sustainable growth.”
Among the targets set under WKB2030 is for Malaysia to achieve a RM3.4 million in growth domestic product (GDP) by 2030 with an average growth rate of 4.7 per cent per annum and for small- and medium-scale enterprises as well as micro-businesses to contribute 50 per cent of the country’s GDP.
Ainul said achieving this would require a transformation in industries, especially in the agriculture sector.
He described smart agriculture and high-value yield as imperative for the country to prosper and elevate the socio-economic wellbeing of the people.
As for the government’s aspiration to turn Malaysia into the new Asian Tiger, Ainul said it could be achieved sooner than 2030.
“But achieving it requires participation from all quarters. We must put aside our differences, including political affiliation, and work together to achieve it.”