KUALA LUMPUR (June 26): The Madani Economy Narrative, which is expected to launch in August, needs to address wages and the Employees Provident Fund (EPF) issue, says Bank Islam Malaysia Bhd's economist Firdaos Rosli.
Speaking during Bank Islam’s “2H2023 Macroeconomic Outlook: Same Risks, Different Outcomes”, Firdaos said it is crucial to increase wages and address the depleted funds in EPF for Malaysia’s economic growth and, in general, for the banking sector.
“It is not just wages like you and I take home, it is also our old age pension, old age savings that were depleted during the pandemic,” said Firdaos on Monday (June 26).
“We must find ways to ensure that we can put back the RM145 billion into our EPF accounts, together with foregone dividends that were lost during the pandemic.
“This is important because we do not want to exacerbate the pension inadequacy in the future,” he said.
He also said the economic narrative has to correlate with the mid-term review of 12th Malaysia New Plan.
“When it was formulated during Covid, we did not anticipate many things, like how revengeful pent-up demand, how raging inflation are after the pandemic.
“So, many of these things are not captured, and it's not the fault of the policymakers. Things have evolved very, very quickly after the pandemic.
“It was not devised by the present government anyway, you need to get back onto the drawing board and start all over again,” said the economist.
Bank Islam noted other key policies in the second half of 2023, including the ongoing fiscal consolidation efforts through subsidy rationalisation and the impact of the upcoming state elections on policy making.