Malaysia’s Household Debt
To the extent that financial difficulties of young people reduce personal consumption, they are another problem for Malaysia’s economy on top of low commodity prices, a battered currency and a political crisis stemming from graft allegations involving Prime Minister Najib Razak, who denies wrongdoing.
Growth of private consumption has been slowing, and if that continues, Malaysia’s growth rate could be hit.
“Households are accumulating debt faster than their incomes are growing, which will likely lead to repayment difficulties when the credit cycle turns,” Standard & Poor’s wrote in an August report.
“Only 30% of Gen Ys surveyed said they live comfortably within their current income, suggesting a generation that is experiencing financial stress. It suggests that they have little knowledge about how to make wise purchasing decisions,” the report said. – See more at: http://www.themalaysianoutsider.com/malaysia/article/malaysias-gen-y-in-debt-living-on-the-edge-survey-reveals#
“It’s super difficult… toll costs double now and GST is a pain. Grocery prices are not too bad but day care and such, all got GST. To buy kids’ stuff, all the prices have gone up,” said Ravi (not his real name) in an interview with Malay Mail Online, referring to the Goods and Services Tax (GST). – See more at: http://www.themalaymailonline.com/malaysia/article/high-household-debt-could-lead-to-malaysians-financial-ruin-financial-plann#