Malaysia is a South Asian country that consists of two noncontiguous regions; Peninsular Malaysia which West Malaysia and Thailand share, and East Malaysia which Malaysia shares with the island of Borneo. While this nation has been able to rapidly tackle its poverty situation, millions of Malaysians still struggle every day. Here are 10 facts about poverty in Malaysia.
10 Facts About Poverty in Malaysia
- Malaysia’s Poverty Definition – Malaysia’s government defines poverty as families earning between the Poverty Line Income (PLI) of MYR800 and those families living below the national median household earnings by 50%. As of 2015, only 0.4% of the population was living below the national poverty line.
- How Malaysia Measures Poverty – Malaysia calculates poverty with the PLI and Consumer Price Index. The Department of Statistics (DOSM) uses micro-data to calculate poverty. It conducts household surveys and the micro-data refers to those responses. The lack of transparency between the government and its citizens lies in the fact that the government hides these results from the public. This leaves many unanswered questions about the poverty situation in Malaysia.
- Unemployment – As of September 2018, Malaysia had a 3.3% unemployment rate and youth unemployment of just above 10%. The total number of unemployed people is 516,400. Limited English language proficiency, unpolished skills and a lack of digital literacy are common reasons for unemployment.
- Access to Clean Water – The Orang Asli, or the first peoples of Malaysia, are significantly unhealthier compared to others due to their inability to access clean water. This caused the Global Peace Foundation to initiate the Communities Unite for Pure Water (CUP) initiative by installing water pumps in a village to filter water into each household. This helped the entire village gain access to clean running water.
- Access to Health Care – Malaysia has a two-tier health system, public and private. Both are easily accessible, yet the public sector suffers from severe overcrowding and wait times are very long. This resulted in many people changing from public to private health care, which is very expensive, leaving families one accident away from becoming poor.
- High Living Costs – The government implemented the Goods and Services Tax (GST) on April 1, 2015, in order to replace sales and services tax. This added tax of 6% caused people to look for new jobs in order to better situate themselves for the new tax. Only 19% of responders said that the tax had done nothing to their routine.
- Corruption – People know corruption to be Malaysia’s “public enemy number one.” Bribery and corrupt activities went from 19% in 2014 to 30% in 2016. The 1 Malaysia Development Berhad (1MDB) case is an example of corruption in the government. Prime Minister Najib Razak looted $4.5 billion from a state fund focused on financing infrastructure and “other economy-linked deals.” This scandal affected a wide spread of people “including financial institutions” from Malaysia to Singapore.
- Minimum Wage – Malaysia’s minimum wage was RM1,000 per month before the National Wage Council’s September 2018 meeting announced its new minimum wage of RM1,050. The government wanted to keep costs of production and wages low so Malaysians did not lose competitiveness with foreign investors. After many protests, Malaysia raised its minimum wage to RM1,100.
- Common Diseases – Poor diet and nutrition cause killer diseases in Malaysia. Coronary heart disease, cancer and strokes affect Malaysians the most. The Malaysian Rare Disorders Society, founded in 2004, is a voluntary organization that looks out for the welfare of families and represents them as rare disorders affect them. The organization helped Aminisha, a girl with the congenital disorder of glycosylation (CDG) Type1b, in May 2004. It provided her tube feeding, plasma transfusion and extraction of excess fluids.
- Social Programs – Under Malaysia’s 2017 Budget, the Malaysian government allocated about RM10 billion for government aid and subsidies. The government helped the Ministry of Women, Family, and Community Development, which financially helps single mothers for a year by providing a minimum of RM100 per month per child and a maximum of RM450 per month if there are more than four children.
Another way Malaysia combats poverty is through EPIC Homes. This NGO has been providing “safe and sustainable housing” for poor families, mainly the Orang Asli, since 2010. About 82% of Orang Asli are in need of housing. More than 5,000 builders have constructed over 100+ houses in over 10+ villages. With the continued work from Malaysia’s government to increase the country’s minimum wage and aid from different initiatives, Malaysia’s poverty status should improve.
– Isabella Gonzalez