By Zaki Salleh
IPOH: Businesses in steel, machinery, and construction materials are facing challenges, and the government’s role in addressing these issues can help affected entrepreneurs.
This includes ensuring that the ringgit remains strong to mitigate foreign exchange risk.
The President of the Chinese Metal Traders Association of Perak, Datuk Eric Koh Seng Kiat, stated that a stronger ringgit would make the prices of imported steel, machinery, and construction materials more competitive.
He noted that this could reduce foreign exchange risk for importers and lower import costs, ultimately helping to reduce inflation and alleviate the burden on the people.
“Due to the sluggish global economy, including China, which is experiencing a property crisis, there has been a reduction in demand for steel, leading to depressed prices compared to soaring raw material costs.
“Nearly 95% of steel mills in China are operating at a loss. A new wave of factory closures, equity transfers, mergers, and restructuring in the steel sector is occurring,” he said during the 85th Anniversary Celebration of the Chinese Metal Traders Association of Perak at a hotel in Ipoh.
Also present was the Exco for Housing and Local Government of Perak, Sandrea Ng Shy Ching.
According to Datuk Eric Koh Seng Kiat, the decline in steel prices this year has forced metal traders to sell old stock at prices below cost.
Additionally, he said, the metal goods industry is facing high costs to operate due to the implementation of several measures.
“These include the introduction of an electronic invoicing system (e-invoicing), environmental, social, and governance (ESG) initiatives, and the introduction of transport taxes, which exacerbate the issue of rising prices.
“Other impacts include adjustments to the minimum wage, reduced weekly working hours, and higher rates for water, electricity, and other utility bills,” he explained.
He further clarified that traders are also affected by the drastic increase in all business license fees and assessment taxes.
Previously, the standard license fee rate was based on the type of business, but the calculation method has now changed to be based on the operational area.
“Assessment taxes have doubled in 2024 compared to last year. Furthermore, the local authorities (PBT) have issued early notices stating that rates for the upcoming year will increase by another 30%, raising concerns.
“PBT should help reduce the cost burden faced by traders, not add to their burdens,” he said.
