The Malaysian Insider :: Features
The Malaysian Insider :: Features |
| Posted: 26 Dec 2013 12:04 AM PST Come the new year, Malaysia will join more than 150 other countries that already have minimum wage laws in place. The policy sets a minimum wage of RM900 per month (RM4.33 per hour) for Peninsular Malaysia and RM800 per month (RM3.85 per hour) for Sabah, Sarawak and the Federal Territory of Labuan, covering both the local and foreign workforce, except for domestic workers such as domestic helpers and gardeners. According to Bank Negara Malaysia (BNM), the minimum wage policy is estimated to benefit about 27% of workers nationally. On average, the affected workers in Peninsular Malaysia are expected to receive a 33% increase in wages, while those in East Malaysia would be given a 38% increment. By economic sector, the agriculture industry is expected to be the most affected, as 43% of workers in the sector received wages that were below the minimum wage prior to the implementation of the policy. If you think the minimum wage policy does not affect you, here are a few reasons why you should care. 1) Higher costs of business If you are a business owner, you can expect a higher labour costs, no doubt. Not only the low-wage workers on your pay roll now needs an upward revision of salary, but this could also mean a whole restructuring of the reward system in your organisation. On the other hand, you may see an increase in productivity of your employees. However, you may have to tweak how you measure the performance of your employees. Furthermore, in the longer run, your firm may be encouraged to automate operations or acquire newer technologies that could enhance production capacity. 2) Higher cost of living Following higher costs of business, consumers can expect pricier product and services. On the other hand, they can also expect better services as a result of increased staff productivity. On the back of reduced subsidies and GST implementation, the minimum wage effect would then be another factor to push cost of living as a consequence of higher costs of doing business. 3) Increased purchasing power Low-wage workers, especially, will have a better quality of life as now they have better purchasing power. Although this group of consumers is unlikely to have mortgages or loans, more money will be spent on necessities and maybe discretionary items too. This would be beneficial for the country's growth, which is largely driven by domestic consumption. Furthermore, economists are of the view that low-income groups tend to have a higher marginal propensity to consume versus the middle income segment. 4) Less poverty, lower crime rate Less poverty could also mean lower crime rate as wealth is better distributed among the members of society. If Bank Negara Malaysia's (BNM) estimate of 27% of the local workforce to benefit from the policy is taken as guidance, the impact should be meaningful. 5) Increased unemployment rate Based on simple economics of supply and demand, the imposition of a minimum wage will cause low-skilled labourers to lose their jobs, creating unemployment. This indirectly can also cause social problems if not rectified such as creating more jobs or subsidising the unemployed until they get jobs again. Reports suggest that up to four million jobs are threatened due to cutbacks and closures following the implementation of minimum wage policy. However, those who disagree say any adjustment to employment as a result of the minimum wage policy will likely be temporary, as dislocated workers would be reabsorbed into the workforce given the relatively tight labour market. According to external data, job vacancies have been on an increasing trend since 2004, while Malaysia's unemployment rate has remained consistently low, with a historical average of 3.3% over the recent two decades. 6) Increased government bill In developed economies, the government must come up with a compensation system for the unemployed as a result of the implementation of minimum wage. It raises the question if the federal government, which is already challenged with tightening the fiscal deficit, will need to fork out more money to support the system. Good news is that findings from a survey conducted by BNM in May 2012 suggest that the impact of the minimum wage policy will be manageable. Over 90% of firms that would be affected indicated they would not retrench workers in response to the policy, while only 25% indicated a reduction in hiring. 7) Economy moves to higher-income The policy is consistent with the Government's objective of transforming Malaysia into a high-income and high-productivity economy; the minimum wage policy provides incentives to both firms and workers to undertake productivity-enhancing measures. This will result in more high-skilled workers and investments in automation and newer technologies that could enhance production capacity, instead of relying on low cost labour. As such, some argue Malaysia, which has long offered competitive costs in doing businesses, risks losing its competitiveness to other neighbouring countries and see a dip in foreign investments as a consequence. – iMoney.my, December 26, 2013. *This article is contributed by Heather Bung, from iMoney.my, Malaysia's leading financial comparison website. To compare and apply for the best financial products, such as fixed deposits, home loans, personal loans and credit cards, visit www.iMoney.my |
| Indonesia builds sanctuary to save world’s rarest rhino Posted: 25 Dec 2013 07:48 PM PST For people seeking a glimpse of the Javan rhino – revered in local folklore as Abah Gede, or the Great Father – such small signs are likely to be the closest they get. There are thought to be only around 50 of the animals left in existence, all living in the wild in Ujung Kulon National Park, an area of stunning natural beauty on the western tip of Indonesia's main island of Java. But now conservationists are hoping that the country's first ever Javan rhino sanctuary, which will open in the park in the coming months, can pull the animal back from the brink of extinction. The shy creature, whose folds of loose skin give it the appearance of wearing armour plating, once numbered in the thousands and roamed across Southeast Asia. But, like other rhino species across the world, poaching and human encroachment on its habitat has led to a dramatic population decline, with the International Union for Conservation of Nature saying the animal is "making its last stand". The new sanctuary will encompass 12,600 acres of lush rainforest, freshwater streams and mud holes in the park, which is a Unesco World Heritage site. It is not due to open until March but park officials say that from hoof prints and bite marks, they believe nine rhinos have already wandered into new areas set aside for them. "It means our scheme to turn this sanctuary into a comfortable home for them is working," the park's habitat manager Rusdianto, who like many Indonesians goes by one name, told AFP. The rhinos were already living mainly in one corner of the park. But the new sanctuary has expanded the area suitable for them and relocated farmers who were living there to reduce the chances of animal-human conflict. An electric fence is also being constructed – the final piece of work that needs to be completed – to mark the boundary and prevent the rhinos from straying out of the sanctuary and humans from coming in. Park officials, who are government employees, have also been planting suitable food for the rhinos. During a recent visit by AFP, workers were seen clearing palm trees from the area and replacing them with shrubs and small trees. "We hope this sanctuary will hasten breeding and lead to more births of this treasured rare animal," park chief Moh Haryono told AFP. "In a more enclosed space, the male and female rhino will have more opportunities to frolic and mate freely." Rhinos around the world are under threat Yet setting up the sanctuary, which is government-run but fully funded by US-based charity the International Rhino Foundation, has been no easy task. It was originally due to open in 2011 but was held up due to red tape, a common problem in the sprawling Indonesian archipelago, which has a huge and often inefficient bureaucracy. Work also stalled for a year due to protests from residents demanding compensation for farmland they had to give up, as well as from local animal activists who felt the use of heavy machinery to build the fence threatened the environment. However all obstacles now seem to have been overcome and, barring any last-minute hold-ups, the sanctuary should officially open soon. Nevertheless it is just a small step in an uphill battle to save the Javan rhino. Officials in Ujung Kulon believe there were 51 of the rhinos in 2012, including eight calves, basing their estimate on images captured by hidden cameras. They hope the true figure may be in the 70s and will have a new estimate once data for 2013 has been collated. The case of the Javan rhinoceros highlights the plight of rhinos across the world, with other species also deemed to be under threat and some subspecies already believed to have died out. Poaching in particular represents a severe threat, with rhino horns used in traditional Asian medicine fetching ever higher prices on the black market despite a lack of scientific evidence showing horn has any medicinal value. In Indonesia, fewer than 100 of the critically endangered Sumatran rhinos remain; in 2011 the IUCN declared a rhino subspecies in western Africa extinct; and the group has said the Central African northern white rhino is "possibly extinct". Asia has stepped up efforts to save the region's dwindling rhino populations, with representatives from several countries in October attending a conference on the issue on the western Indonesian island of Sumatra. Countries represented, including Indonesia, Nepal and India, pledged to take steps to grow their rhino populations by three percent annually. For the Javan rhino, its population already decimated, the threat is no longer poaching but food scarcity, illness and the risk of natural disasters in an archipelago where earthquakes and landslides are common, according to WWF Indonesia. Despite the myriad threats, wildlife officials are hopeful the new sanctuary is a step in the right direction. They have also been heartened by strong support from the local community. Any effort to save the Great Father is applauded in an area where centuries-old beliefs persist and intertwine with the vast majority's Muslim faith. "We must do all we can to prevent the Javan rhino from becoming extinct," Suhaya, a 67-year-old farmer who goes by one name, told AFP. "Locals here believe that Abah Gede must not vanish from the face of the Earth, or disaster will befall us." – AFP, December 26, 2013. |
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