The announcement of
the increase of RM 0.20 per liter for R0N95 and diesel infuriated many citizens
who are already facing rising costs of living. The announcement that there will
be no changes for R0N97 brought little respite. However, many have chosen to
look at the announcement from distorted and warped lens. Indeed, the
seriousness of the situation is a matter of perception.
With such a scenario
that affects everyone, some political leaders have chosen to politicize the
issue instead of providing a true and accurate picture of what is truly
happening, not just in our country, but also in the world. Our government is sincere in its Endeavour to
prioritize the citizens’ welfare but unscrupulous leaders are joining the cause
with populist views for political mileage.
Hence, before you
start pointing fingers and blaming the government, get your facts right. Dispel
myths and remember facts that matter – not the spins that half-past six
Opposition leaders spin to confound you for the sole purpose of stirring your
hatred for the status quo!
Myth: The price
increase is due to BN corruption and/or the payback of voting BN into power.
Myth: The price increase will cause inflation.
Fact: The country’s
inflation rate is under control and there are fiscal and monetary policies to
control inflation and its effects on the economy.
Fact: The increase of
petroleum price is due to the ongoing Syrian Conflict. Twelve years ago oil
price were mere US$15 compare to - current scenario where it could reach US$150
per barrel.
Fact: The Libyan
crisis in April 2011 caused a spike in world oil prices that caused a sharp
rise in the prices at the pumps.
Fact: Malaysia is officially not an oil exporting
country. About 90% of our oil is used for own consumption.
Fact: The reduction
of the subsidy, which led to the price increase to RM 2.10, will discourage
smugglers from Thailand & Indonesia who have been making profit directly
from us.
Fact: The Government
Petrol subsidies are meant for the poor and low-income group.
Fact: The government
has allocated a total of RM24.8 billion this year on fuel subsidies. The PM has
said the country would save RM1.1 billion with the increase of 20 sen in the
price of RON 95 and diesel. In a full year, the government will save RM3.3
billion while still subsidizing 63 sen per liter for RON95 and 80 sen per liter
for diesel. The increase of RM 0.20 will save the Government around RM
3.4Billion.
(Source: TMI)
Fact: Putrajaya has concerns over revenue and faces
the likelihood of the country being punished by ratings agencies and foreign
investors if no attempt is made to tackle structural problems, such as the high
rate of subsidies. Therefore, this reduction in subsidy is a move in the right
direction.
Fact: The government’s stated target is to reduce
our fiscal deficit to 3% by 2015. Hence, the increase in the price of fuel was
not a political issue but rather about Malaysia's economic status and survival.
It is better to tackle economic issues in the country and take steps via fiscal
consolidation to increase market confidence once fiscal deficit is reduced.
Fact: To alleviate
the burden of rising costs, there will be an increase in BRIM next year to be
announced in the Budget. BRIM 2.0 cost
RM 2.9 Billion early this year.
Fact: Our government
is very considerate in cutting back on subsidies slowly. Indonesia had
increased petrol price up to 33% in one go 3 months back.
Fact: If the
government does not take this move, the other alternative would be increasing
taxes.
Fact: Petrol prices
fluctuate according to market conditions and when it goes down, petrol prices
in the go down accordingly. However, this is not the same for goods and
services because some traders and business sectors increase prices when the
petrol price increases but seldom ever decrease prices when the price is
reduced. This is cause for more action and monitoring.
Fact: Each one of us
must be environment conscious and take steps to reduce petrol consumption and
ensure a better quality of life via a reduction in pollution caused by car
emissions. Explore alternatives such as car-pooling, taking public
transportation, or walk/cycle.
Fact: Between RM25,
billion to RM30 billion is spent on subsidies to allow Malaysians and
foreigners to enjoy cheaper fuel, gas, and water. Such subsidies actually the
economy and are enjoyed by groups of Malaysians and foreigners who really
should not be benefiting from cheaper goods and services.
While grumbling about
the 20-sen increase in the price of a liter of RON95, many have forgotten that
the pump price has doubled in 15 years but world oil prices have gone up 10
times in the same period.
Fact: The main
beneficiaries of subsidized diesel are owners of Vietnamese and Thai fishing
vessels, and the Malaysian fishermen who sell their subsidized allocation to
them. Reducing the subsidy is a very vital move to arrest the leakages from our
circular flow of income.
Fact: Petronas
profits are down and the national oil company has been warning Putrajaya that
it cannot continue subsidizing gas for industrial use.
The move for the
reduction in subsidies shows our PM is a realist and ready to forego populist
moves for the well-being of the nation.
In sharp contrast,
Opposition leaders such as Liew Chin Tong are politicizing the issue by making
bizarre allegations that there may be a deadly cost to raising pump prices for
RON95 petrol and diesel without serious effort to upgrade the country’s public
transport system – a case of comparing apples and oranges.
It is all up to us to
adopt the correct perspective of the situation with the right facts and not
fall prey to senseless propaganda. As it stands, the PM and his team are on the
right track!
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