Developed nation’ label meaningless if wealth inequality remains, says Daim

The Malaysian Insider

BY LEE SHI-IAN and NATHELIE TAY

Published: 11 November 2014

Warning against growing economic inequality, former finance minister Tun Daim Zainuddin said developed nation status will be meaningless if many of Malaysia's citizens are still earning below the poverty level and are unable to afford their own homes. 

Daim (right) with former New Straits times group chief editor Datuk A.Kadir Jasin (left), and The Colour of Inequality author Muhammad Abdul Khalid at the book launch today. - The Malaysian Insider pic by Afif Raiezal, November 11, 2014. 

He said there was no point in boasting that Malaysia was becoming a high-income and developed nation when house prices were still beyond most people's reach.

"Many of our old folks in the villages and in the cities struggle to put food on the table and send their children to school every day," Daim said in his keynote address during the launch of the book The Colour of Inequality by economist Muhammed Abdul Khalid, today.

He also said it was pointless for Malaysia to be touted as one of the biggest consumer markets of luxury goods in the region, if such spending was funded by credit.

Daim said how Malaysia had progressed as a nation should not only be measured in dollars and cents, or solely on income or poverty levels.

"We must focus on the ultimate objective of our policies, the well-being of our rakyat," he said.

"We must also focus on their progress, in assets or wealth, and education, employment opportunities,housing and health."

Daim said the brutal truth was that many Malaysians were quite vulnerable, despite having jobs.

"Yes, it is true that we have progressed. Many have become professionals and members of the middle class.

"But many have still been left behind and many more work in low-wage occupations," Daim said, adding many did not even have tertiary education.

He also noted the low savings rate across all ethnic groups, warning that this would expose them to great risks if emergencies were to happen.

Property ownership was also a great concern of many Malaysians, he added, and mentioned in passing the effects of property speculation on those who genuinely needed homes.

"Housing has now become a financial asset, in fact, it has become an instrument of speculation rather than something for us to live in," he said, noting that home ownership was particularly difficult for those below the age of 40.

Daim said Putrajaya had a critical role to play in addressing these issues, as it was not viable to rely on the market.

"Reliance on the market will not bring the desired results of addressing fundamental socio-economic disequilibrium in Malaysia."

Daim said an ancient philosopher once said that the greatness of a nation and its moral progress can be judged by how it treats the weakest members of its society.

The book, The Colour of Inequality deals with affirmative action in Malaysia and its continued relevance, provided a needs-based and targeted approach was taken so as to benefit low-wage earners regardless of race, instead of the elite or the corporates. – November 11, 2014

Original article here