Watch and Learn - Malaysian PM tightens spending in first budget

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A meal for under a dollar twenty. Menu Rahma, which means compassionate menu,

A meal for under a dollar twenty Menu Rahma which means compassionate menu

is a government initiative for restaurants

and food stalls to offer affordable meals

as a way to counter the rising cost of living.

as a way to counter the rising cost of living

More than fifteen thousand premises

have signed up to the program since its

launch last month. "First, you don't make a loss,

launch last month First you don't make a loss

you actually make a 20-25% margin, so

you actually make a 20-25 margin so

there's no loss here, okay?" The second

there's no loss here okay The second

part is that you're helping somebody,

part is that you're helping somebody

helping the poor,

helping the poor

helping the needy. But like many

helping the needy But like many

other operators, he says this can only

other operators he says this can only

be sustained if the cost of ingredients

doesn't keep increasing.

doesn't keep increasing

The government imposes price ceilings on certain items

like raw chicken and eggs to ensure they

remain affordable. Low-income families

remain affordable Low-income families

spend around 40% of their income on food,

spend around 40 of their income on food

so they are the hardest hit

by rising food prices. For much

by rising food prices For much

of last year, food inflation in

of last year food inflation in

Malaysia was around 4%, but rose to

Malaysia was around 4 but rose to

7% in November. But price controls have caused

7 in November But price controls have caused

a supply shortage and

consequently higher prices. Malaysia

consequently higher prices Malaysia

used to produce enough eggs to export,

used to produce enough eggs to export

but when the cost of chicken feed started

to rise and the controlled price of eggs

didn't, poultry farms reduced production.

didn't poultry farms reduced production

"I came to get eggs, but they didn't

I came to get eggs but they didn't

have the ordinary ones, so I have no

have the ordinary ones so I have no

choice but to get the special omega-3

ones, which are more expensive, and

ones which are more expensive and

that'll affect my custom."

that'll affect my custom

The government says

it'll consider removing price caps later

this year. The country also subsidizes petrol and electricity,

this year The country also subsidizes petrol and electricity

among other items.

among other items

Last year, its subsidy bill ballooned to 18 billion dollars,

Last year its subsidy bill ballooned to 18 billion dollars

or around 21% of its GDP. "More often than not,

or around 21 of its GDP More often than not

and Malaysia is not an outlier here,

and Malaysia is not an outlier here

most countries due to political

economy reasons or whatever, price

economy reasons or whatever price

controls and subsidies tend to fall

into the pattern of the three 'U's, so

into the pattern of the three 'U's so

they become untimely, untargeted and

they become untimely untargeted and

unmeasured, and you

unmeasured and you

have all these attendant problems."

have all these attendant problems

As an issue, national debt is also rising,

As an issue national debt is also rising

while the budget deficit is expected to widen.

while the budget deficit is expected to widen

The government says it wants to ease the cost of living,

The government says it wants to ease the cost of living

but it may lack the tools to get it done.

but it may lack the tools to get it done

Florence Louis, Al Jazeera, Kuala Lumpur.

Florence Louis Al Jazeera Kuala Lumpur

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