kuala lumpur: Economy Minister Rafizi Ramli said the government would communicate to the public the structure and criteria of the targeted subsidy initiative in the coming weeks.
He added that the government will also explain the impact of subsidy rationalization on each segment of society.
“The government knows exactly what is going to happen and what the mechanism is. We want to control the communication, so it’s not getting through,” he said today in the World Bank’s April 2024 Malaysia Economic Monitor. He said this in a speech at a public presentation.
Rafizi said that Padu, a platform that integrates and maintains the personal data of Malaysians aged 18 and above for targeted subsidy rationalization, has 11.6 million people, representing 52.6% of Malaysians aged 18 and above. He said the individual is registered.
He said this would give the government enough headroom to rationalize subsidies and move away from the regressive model of block subsidies. With this level of necessary detailed data, he said, governments can minimize both exclusion and inclusion errors and distribute subsidies fairly to those who need them most.
Rafizi said World Bank estimates show that if governments can rationalize subsidies, they can double poverty reduction while also generating fiscal savings by redirecting these subsidy savings to social assistance. he pointed out.
“By undertaking this once-in-a-generation fiscal reform, Malaysia can begin to close the hole in its growing federal debt, which stands at 64.3% of GDP (gross domestic product). “This is especially true in this high interest rate environment,” he said.
With this strengthened financial position, the search for new growth areas remains urgent, he added.
Rafizi said this rationale underpins the government’s recent introduction of KL20, which marks a departure from previous strategies.
In addition to launching the KL20 Action Paper, the government has implemented a series of reforms aimed at positioning Kuala Lumpur as a leading destination for venture capitalists and startup founders.
“The legitimacy of these reforms has been proven by the announcement of several deals. These include the RM3 billion ASEAN Investment Initiative, the acquisition of 12 international VCs (venture capitalists) to open new offices here; ), Southeast Asia’s largest IC design park backed by companies such as Arm and Phison,” he said.
On the labor market front, Rafizi said the Progressive Wage Policy White Paper was tabled in Parliament and passed in November last year.
“We are already planning to start registering the pilot project next month, which will serve as a case study for widespread adoption across the country to eliminate the bottleneck of stagnant wages,” he added. Ta.
