Tuesday, November 21, 2017

Is barter system popular in Malaysia ?

Understanding of barter trading

The barter system is a kind of trading system in which goods and services are directly exchanged against any other goods and services of the same value without the involvement of currency or money. In ancient times, it was a basic means of trading between countries however, later on with the development of economies of different countries the system was changed to monetary exchange, but still in some countries, it is considered as a main source for trade both locally and internationally. In the barter style of exchange, there must be a willingness of two parties for the exchange of two different or same natural and value items. In ancient times, when there was no concept of money all trades was done via this method including food items and necessities to luxury lifestyle products and services.

 Popularity of barter system in Malaysia

Malaysia is one of those countries where the barter system has immense and long lasting popularity among people. In 14th century, Parameswara, a Sumatran prince, found a port city and he felt the area is suitable for trade. That was the beginning of the barter trade system in Malaysia, which made the people of Malaysia able to enjoy different facilities of life by trading with other countries. Before the barter trade system Malaysia has been just a country dependent on its own products, but later on the system of barter introduced lots of opportunities for people to take advantage. Still in Malaysia along with the modern trade system, the barter system is in use. It is because of high advantages of barter trade and the existence of a barter trade system in Malaysia is the evidence of the great success and benefits of the system. Today, Malaysia is one of prosperous countries with many developments like airports, ports, highways, telecommunication, 90% literacy rate and many other developments but still is following their traditional style of trading mostly in their local trade and is inviting many international traders to make an investment here.

 A frequently used method of trade in villages

The barter system is a frequently using method in lots of Malaysian villages. They are exchanging different corps, animals, clothes and other necessities of life against other goods and services. Many farmers are doing farming for property owners, and as their wages, they are getting corps, clothes and other items instead of money.

International barter proposals

Because of the popularity of the barter trading system in Malaysia now, the government of Malaysia is seriously thinking to implement the system again on an international level. In June 2012, Malaysian minister has revealed that they will soon consider a barter trade with India. The deal will be based on the exchange of wheat and rice against palm oil. In this way Malaysia will able to import rice and wheat to fulfill their food needs whereas India will able to fulfill their vegetable oil needs. Barter system has always found beneficial for both parties and this is the main reason of its popularity.

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