Prices of RON95, sugar, rice to go up in ‘subsidy rationalisation’? Govt resists Miti agency’s proposal to remove subsidies
Implementation will depend on Putrajaya’s political will as move could be highly unpopular, says one source
(The Vibes) – If the Malaysia Productivity Corporation (MPC) has its way, Malaysians could very soon be spending considerably more on several key essential items due to the removal of subsidies.
It is understood that discussions are currently at an advanced stage, with the agency under the International Trade and Industry Ministry (Miti) appearing intent on pushing for what it is termed as a “rationalisation of subsidy”.
Among the subsidies that are being proposed for rationalisation include RON95 fuel as well as agricultural products like sugar and rice.
The proposal has been mooted since the days of Datuk Seri Najib Razak’s prime ministership, but support for it has intensified on the back of a wrenching Covid-19 economic downturn being further aggravated by the Russian invasion of Ukraine, which has driven oil and gas prices up.
The Vibes was informed that the push by the MPC is motivated by the understanding that the billions of ringgit spent by the government on subsidies each year are stifling the country’s productivity and competitiveness.
Various global competitiveness indexes constantly rank Malaysia at an average spot, with one of the reasons cited being the country’s generosity in offering subsidies.
The implementation of the rationalisation of subsidies will now depend on approval from Prime Minister Datuk Seri Ismail Sabri Yaakob and his cabinet.