Disclaimer: In Real Life is a platform for everyday people to share their experiences and voices. All articles are personal stories and do not necessarily echo In Real Life’s sentiments.
It’s scary to think that whenever you head to another country, the only thing that keeps running in your head is multiplication. S$3 for a plate of chicken rice in Singapore doesn’t sound too bad right? But it’s all fun and games til you realise you’ve paid almost RM10 for something you could probably get for half of that back home.
I mean it’s definitely not that surprising, that’s the expectation upon travelling. But as of late, we can’t keep pretending for much longer that the ringgit isn’t a problem, and that it doesn’t directly affect our travel plans.
How weak is the ringgit exactly?
Source: iMoney
The ringgit had further weakened against the US dollar since March, from trading below RM4.20 to hitting a whopping RM4.40 right now.
The ringgit also depreciated to a record low against the Singdollar on May 24, touching RM3.20.
To think it was just less than 10 years ago, where the ringgit held a strong RM3.00 to the US dollar and RM2.51 against Singdollar, according to data from the Wall Street Journal.
Malaysia’s weakened currency would eventually result in higher import prices, burdening both consumers and importers.
What does this mean for M’sians who want to travel?
To put things in perspective, let’s take a not-too-far-away popular travel destination for example: Bali.
Source: Expedia
Depending on how rich your father is, you would probably find that an average of RM3000/pax pretty costly for a 3-4 day trip to a neighbouring country. Granted as mentioned, it is a popular island after all, but is it worth around the full salary of a lot of Malaysians?
But say you’re living in Malaysia but earning in American dollars, you’d have to spend ~$600 (a smaller chunk of the average salary) for the same deal, which to me at least, sounds a lot more reasonable – considering flights and accommodations are both included in this case.
The cost of living in Malaysia is not that great either
Let’s factor in everyday necessities as well. The cost of living varies depending on where you’re from.
According to Numbeo, the average cost of living in a month in Singapore for a single person would be S$1,339.08, in Germany it’s €875.94, while we Malaysians stand at an average of RM2,216.22.
Just by comparing dollar-to-dollar, Malaysia has a far higher cost of living – even when compared to European countries.
To put things in perspective, Malaysia ranks 93rd in the world in the cost of living index, which is understandably better than quite a few nations. However, our weak currency has allowed competing countries to step ahead by miles due to the affordability from the same wages.
As mentioned briefly, the dip in the MYR doesn’t help for imported goods as well, as increased costs of imports would also hit Malaysia in terms of necessities such as food, in which the country is a net importer.
So not only do we have a weak currency, but our cost of living is also off the charts. No wonder we’re always left so poor at the end of the month with little to no savings.
Economic recovery?
For context, it’s not surprising that Malaysians are quick to point fingers at the leaders of the country (amongst a trifecta of other things) for the instability of our currency.
To give the country’s politicians the benefit of the doubt, there is also the possibility that the ringgit is dictated by market forces after all and not entirely political instability.
We can’t deny that external factors affect the ringgit’s value, and that in the past 10 years, the value of regional currencies has gradually strengthened while our MYR continues to slump.
But is the ringgit wobbly due to the volatile global economic conditions?
Or is the ringgit feeble due to the never-ending political bickering in the country which has scared away investors?
You be the judge.
For more stories like this, read:
https://inreallife.my/i-started-investing-when-i-became-a-father-i-wish-id-began-sooner/
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