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Malaysia's leader pledges to ease public burden after massive gasoline price hike

Malaysia's leader pledges to ease public burden after massive gasoline price hike

Malaysia's leader pledged Monday to improve public transport and introduce other measures to ease public worries after the government raised gasoline prices by 41 percent last week.
The unexpectedly sharp hike in fuel prices led to sporadic protests nationwide, with opposition groups calling for a mass demonstration on July 21 to urge the government to reverse its decision.
Prime Minister Abdullah Ahmad Badawi defended the cut in fuel subsidies as crucial to ensure the country's long-term economic viability as global oil prices hit record highs and showed no signs of abating.
But he assured consumers that the government would protect their welfare.
"It was a difficult and agonizing decision to make.... Certainly, we realized that the decision would be met with great anguish, not to mention anger, from the people," Abdullah said when opening a two-day oil and gas conference.
"I would like to assure all Malaysians that the government is fully aware of the increased hardships that they now face and that we will do everything within our power to alleviate the people's burden."
The government will speed up cash rebates to car and motorcycle owners, enlarge the list of controlled items to keep costs down and put more buses on the roads to boost public transport, Abdullah said.
The social safety net for lower-income and underprivileged groups will also be expanded, and cost-cutting to be implemented in all government departments and agencies, he said.
"Other measures will also be announced in due course," he said.
The pump price of gasoline rose Thursday by a whopping 41 percent to 2.70 ringgit (US$0.87) a liter, or 10.23 ringgit (US$3.30) a gallon. Diesel prices shot up 63 percent to 2.58 ringgit (US$0.80) per liter.
Like other Asian countries, Malaysia had faced a spiraling fuel subsidy bill that could have been more than 56 billion ringgit (US$17 billion) this year due to rising world oil prices.
Still, despite the increase, Malaysia's gasoline prices remain lower than other Asian nations such as Singapore, Thailand and India.
In addition to the fuel hike, Malaysia also increased electricity tariffs from July by as much as 26 percent for some consumers.
The energy price hike is a politically risky move for Abdullah, who is fighting for his political survival after his ruling coalition's shock election losses in March.
The move is expected to push inflation to a 10-year high of around 5 percent, up from 3 percent now, and slow consumer spending and hurt Malaysia's economic growth.
Abdullah has said the revised energy prices would save the government 13.7 billion ringgit (US$4.4 billion; euro2.9 billion), part of which will be used to help subsidize rising food prices.


Updated : 2021-04-18 16:29 GMT+08:00