By Nura Valentiana Lorna & Neville Timothy Sanders
KUCHING: The recent global warning of higher interest and inflation rates has prompted the Consumer Voice Association of Sarawak (COVAS) to advise the government to tackle the problem with effective measures.
Its president Michael Tiong said desperate situation called for desperate measures.
“From history, government knows that any war, inflation and other global happenings will stir the world economy either upwards or downwards.
“This will affect interest rates, lending policies and the socioeconomic structures of the affected countries.
“Sectors such as oil and gas, commodity, products and services high dependent on certain currency, external borrowing, loan or exchange will definitely increase their selling prices domestically in tandem with the so called “world increase” of inflation/interest rates on the upward trend or vice versa,” he told New Sarawak Tribune.
He said the increase would cause some countries to borrow from the International Monetary Fund (IMF), thus enslaving these countries into high repayment of interest.
Some might not be able to pay back within a stipulated period, he said, thus forcing them to “sell their country” or even end up bankrupt if there was no injection of foreign investment fund and domestic economy revival.
“When the wave is coming, more often than not, the government tends to just accept it and pass the burden to the consumers to endure the unwanted pain.
“Realising this issue, the people could always opt for alternative daily low spending. Not forgetting also that traders and industrial players also need to survive so that the country will provide employment, food and the necessities,” he added.
Tiong stressed that the market mechanism which affected the cost of supply chain that involved many parties, including cartels, should be revisited and studied speedily so that a thorough understanding could be established with related parties getting involved and playing their role for the interest of the country.
The fundamental economic survival model that was established since the country’s independence should be revamped to cushion the world impact, he said.
Urging the government to tackle the rising food costs as well as price hikes in other products, Tiong said the government could always take advantage of its own resources.
“Cooperative farming should be studied and formed so that consumers can be part as the business owners.
“The excess profit can be distributed back to the members in the form of cashback.
“The cashback is calculated according to purchases. The more a consumer buys, the more cashback he gains,” Tiong said.
He pointed out that co-operatives were not private entities with just purely profits on their mind, they should lower the prices to benefit even other consumers who were not members.
“There with consumers as business owner themselves, they will have a clearer understanding as to why prices have to be increased due to cost structure and other external factors,” Tiong said.