Last minute announcement on subsidy rationalization to prevent traders from raising prices repeatedly – Rafizi
The government’s practice of making last-minute or sudden announcements when it comes to subsidy rationalisation is to prevent traders from ‘multiple’ hikes in commodity prices, said Economy Minister Rafizi Ramli. Any advance announcement would, on the contrary, lead to traders taking advantage of the situation, he added.
“We have to balance the impact if the signal is given earlier, because the problem is that the price increase is set by traders. For example, if it is announced earlier, it will cause the price of the item to increase many times and that is why the government’s decision is better taken when it is already finalized at the government level,” Rafizi told parliament today, reported by Malay Letter.
“That will reduce the risk of prices skyrocketing many times over,” said MP Pandan.
Rafizi was referring to the sudden announcement of a diesel pump price hike, as part of the diesel subsidy rationalisation programme. On May 21, Prime Minister Datuk Seri Anwar Ibrahim announced that The cabinet approved the program.expected to save the government about RM4 billion a year.
The Prime Minister did not mention a specific date, but on 9 June, Finance Minister II Datuk Seri Amir Hamzah Azizan announced that retail diesel prices in Peninsular Malaysia would increased 56% to RM3.35 a litre on June 10.
Expect the same pattern to inform the removal of the general subsidy for RON 95 gasoline, that is is expected to happen this year.
Last month, when asked if the move would be implemented this year with a timetable to be announced in advance, Rafizi said the government was keep your cards close to your chest in the same way as diesel. “We surprised people with diesel, and I think people were expecting another surprise,” he said. Bloomberg on the sidelines of the World Economic Forum’s summer meeting in Dalian, China.
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