Prices of goods in Sabah sky-rocket

KOTA KINABALU: The price of many goods and services in Sabah is rising steadily as the countdown begins to the entry of the Year of the Horse in the Chinese calendar.

A glass of a plain hot Chinese tea, which used to be provided free or at a token 30 sen is more than double these days.

According to business operators, prices of almost everything in Sabah are is to sky-rocket from this month onwards.

Services like those provided by hotels, hair saloons, spas and the like are all expected to become more costly.

The question now is will consumers curb spending and put some of these businesses in a difficult position.

The retail business community claims suppliers started to increase prices as early as September last year but they had maintained their charges to keep customers satisfied until now.

“This would be the single biggest hike of prices of goods to be experienced by Sabahans,” one shop operator warned.

He said when the government decided to pin fuel prices at global market rates recently, the immediate effect was that all goods became dearer as all needed to be transported.

In big states like Sabah and Sarawak where the road network is substandard to non-existent, fuel costs determine the variation of price of goods even in places just kilometres apart.

Business operators interviewed by FMT blamed fuel costs as among the main factors determining the price of goods in a state which relies on importation for almost all its needs.

“Everybody along the business chain has to increase their price accordingly … imagine the cost of related products,” said a retailer who gave his name as Ah Chang.

‘Everything will go up’

Ah Chang also showed FMT, letters from his suppliers dated September last year to prove his point.

One of the letters from a supplier of known brands stated that during the previous months the company absorbed the the hike in raw materials prices to keep its prices down.

The letter however went on to explain that “despite the company’s best cost containment measures, cost of products were pushed to historic levels and that the company was unable to mitigate current costs anymore.

“Thus it is necessary to announce price increases to all customers for all orders received or made on or after Jan 13, 2014,” the letter stated.

The business owner claimed that the prices of all tinned and milk-based products, bread, biscuits, and almost all household essentials would inevitably increase.

“Everything will go up. Even school bus fares go up. Food costs even more … maybe 20% increase, maybe 30% on some and I am not surprised even 100% in some places for some items,” another retailer in Penampang who declined to be identified said.

“Which shop would not increase price of goods … even “rokok seludup” also will cost more after this. These goods do not fly on their own to our shops. They have to be transported and the fuel price has increased since last year.

“The government has also mandated it for all employers to give a minimum salary of RM900 in Sabah so this has added to the cost of operations,” he said.

The businessman also pointed to how the higher price of sugar had forced the price of all sugar-based products to increase.

Boycott errant traders

But while businesses started to up their prices, a consumer activist in Sabah called on consumers to exercise their power by boycotting shops that sell goods at exceptionally high prices.

James Bagah, president of Consumer Affairs and Protection Society of Sabah (CAPS), made the call as reports came pouring in of excessive price increases on various goods.

“Beginning this month, we must use our rights and power as consumers to boycott. Please do not go to these premises that sell goods at very expensive prices,” he said in a television interview recently.

However, his colleagues in CAPS are wary.

One of them told FMT that while he agreed with Bagah’s call, he also sympathised with businesses.

“The onus is on consumers themselves, they must know where to look for cheaper goods and those in lower-income bracket should start trimming expenses,” he said.

He warned that if shop owners decide to increase rents for their shop lots, the prices of goods could increase further.

Meanwhile Sabah Chief Minister Musa Aman on Wednesday announced the setting up of a committee to monitor spiraling prices.

He said the new committee would keep a keen eye on certain parties including middlemen attempting to manipulate the cost of goods and inflate prices.

“We received a number of complaints on price hikes of goods in Sabah and as a responsible government we resorted to this initiative and are monitoring their actions consistently,” he was reported to have said.

Musa who is also state security committee chairman dismissed the fuel price hike as being the cause for price escalations, adding that the culprits were actually middlemen bent on reaping profits.