Fomca: Prices of essential goods up at 5% per year

Prices of essential goods are still rising at a rate of 5% annually, according to Fomca’s consumer research and resource centre.

“Generally, prices of goods fluctuate in the short term but increases annually at an average rate of 5%,” said the centre’s chief executive officer, Datuk Paul Selva Raj.

Until March, consumer prices continued its upward trend, led by increases in food prices and utility bills.

Last month, the Statistics Depart-ment said the Consumer Price Index (CPI) increased from 111.5 to 113.2. Consumer prices rose 1.5% in April from a year ago.

Food prices, accounting for 31% of Malaysia’s inflation index, rose 1.7% in March while the cost of housing, water, electricity, gas and otherfuels rose 1%.

Prof Tan Eu Chye of Universiti Malaya’s Faculty of Economics and Administration said any removal of subsidies would not only cause a spike in the country’s inflation rate but also a sustained hike in the cost of living.

Fomca is backing the Government’s move to gradually cut subsidies but said the Government should draw up alternative measures to protect consumers.

Its secretary-general Muhd Sha’ani Abdullah said it was vital that the Government implement safety net measures by pumping funds into other social sectors.

“Prices of goods and fuel may go up. In return, why not increase aid for education, healthcare, public transport and housing?” he asked.

“By helping these sectors, the Government would be able to acco­mmodate and cushion the pressure felt by consumers.”