Income up 40%, you believe it?

Do you believe it? Malaysians are better off than four years ago.

With inflation flying sky high, the government can still claim that prices are all under control and inflation only increases 2%.

When there was a 30sen per litre hike on fuel prices, the government told the people not to worry as the government will improve public transportation. DPM also asked people to change lifestyle. Today we still see people waiting for hours to get their buses coming. LRT/KTM Komuter still got problems - delay, malfunctioned, passengers trapped in the cabins/stations etc.

Now, the Second Finance Minister claimed that we are earning more, than we did four years ago. According to him, the increment is 40%. Read the Star report below and rebutal from my colleague, Tony Pua:

Malaysians better off than four years ago

By K. SUTHAKAR

PENANG: Malaysians from all walks of life are better off now than four years ago.

Second Finance Minister Tan Sri Nor Mohamed Yakcop said the country’s per capita income had risen by 40% between 2004 and 2007, from RM15,819 (US$4,163) to RM22,345 (US$6,452).

“If we compare in terms of US dollar, the per capita income has risen by 55% during the period due to the depreciation of the dollar against the ringgit.

“The Barisan Nasional Government is confident that we will get the people’s mandate again, based on the improved economic resilience.

“However, there will be challenges and we are prepared to meet them,” he told newsmen after visiting the St. Nicholas’ Home yesterday.

Nor Mohamed, who presented RM25,000 to the home for them to buy an additional van, also said the average economic growth from 2004 to 2007 was 5.9%, compared to 5.1% from 2000 to 2003.

“The 5.1% growth is already good but we have improve on it. We are confident of reaching 6% by the end of this year,” he said.

He said the Government collected RM142bil in revenue in 2007, an increase of 53% compared to RM93bil in 2004.

In terms of dividend payments, he said the Employees Provident Fund declared a 5.8% dividend last year compared to 4.5% in 2004.

In comparison, Tabung Haji announced a 7% dividend last year compared to 4% in 2004.

He said the Government’s focus on smallholders had resulted in them enjoying higher income.

The average income of rubber and oil palm smallholders was RM3,041 and RM5,841 respectively last year, compared to RM1,226 and RM2,784 in 2004, he said.

This was an increase of 148% and 109% in income for rubber and oil palm smallholders.

Nor Mohamed said the market capitalisation of companies listed on Bursa Malaysia to date was RM1.05tril, an increase of 64% compared with RM640bil at the end of 2003.

He said inflation rate from 2004 to 2007 was 2.5%, which was low, while the unemployment rate was 3.1% last year compared with 3.6% in 2004.

And here is Sdr Tony Pua's rebutal:

Nor Mohamed Yakcop must be joking by saying that Malaysians per capita income increased 40%

The Star reported that Malaysia's per capita income rose by 40% in 2007 compared with 2004 according the Second Finance Minister, Tan Sri Nor Mohamed Yakcop in Penang. He said that per capita income was now RM22,345 compared with RM15,819 previously.

Nor Mohamed Yakcop must either be completely out of his mind, or can no longer perform simple Mathematics or worse, attempting to insult the intelligence of ordinary Malaysians.

Malaysia's Gross Domestic Product (GDP) grew by 5.0%, 5.9% and an stimated 6.0% in 2005, 2006 and 2007 respectively according to the Government's official statistics. (Source: http://www.statistics.gov.my/files/download.php?cat=2&id_file=1)

Based on the above growth rates over the past 3 years, Malaysia's GDP grew by approximately 17.9% from 2004 to 2007.

Income or GDP per capita is calculated by dividing the GDP with the total population. Therefore, it is completely inconceivable that our per capita income increased by 40% when our GDP grew by only 17.9%. Unless of course, the honourable Minister believes that our population shrunk by some 16%!

To achieve 40% growth, Malaysia must be growing in excess of 12% per annum. Hence, to grow by 40% over 3 years, with a population growing at just under 2% per annum, that will actually make Malaysia the fastest growing economy in Asia, outstripping even China and India.

The Second Finance Minister should refrain from getting intoxicated by the general election fever, in the attempts to paint a heavenly picture of the Malaysian economy. He must instead make an official public apology for his outrageous claims.