Sunday, July 31, 2005

Up, up and away!!!

Once again, the Government has bestowed upon us Malaysians a 'gift' we all do not need, especially in such circumstances. In less than 100 days, the Government has increased petrol and diesel prices TWICE - 10 and 20 sen respectively in each occasion. However, the Government chose to announce their latest decision on the price hike late last night so news couldn't reach the masses in time for everyone to rush to the nearest petrol stations to fill up their tanks. It was also smart of them to choose a Saturday, so civil servants won't help in spreading the news and there won't be much coverage on the hike since the following day is a Sunday. By the time people go to work on Monday, the news would have sunk in and most (if not all) would have accepted the decision. A very smart and sly move by the Government indeed. I guess we should have seen it coming when the Minister in the Prime Minister's Department wrote an article about 'Oil Money is for Benefit of All' just two days before the announcement.

Let me set the record straight. I've always called for the increase of petrol prices since it is still one of the cheapest in the region. At least, it is good to know the Government refrained from using the stale old excuse of 'still among the cheapest in the region' after the latest price hike. In my opinion, the revenue generated (or saved whichever way you look at it) should be used to improve public transport. Higher petrol prices would also deter Malaysians from using private vehicles thus, promoting the use of public transport instead. So, why am I against the latest price hike? This move comes a week after the de-pegging of the ringgit to the US dollar. Analysts value the ringgit to about RM3.50 per USD as the acceptable exchange rate. However, it is still hovering at RM3.75 per USD due to the intervention by Bank Negara. If the ringgit is allowed to appreciate, the Government should be able to save a substantial amount importing the petroleum products and won't need to increase petrol prices twice in less than 100 days! Yes our country is a nett oil exporter but what has Petronas really done for us although being able to record increasing profits year after year? Are the royalties, dividends etc. really used efficiently for national development? A stronger ringgit might hurt exports but we must still remember that imports would be cheaper too and that should help balance things out. Let's not forget that inflation is rising and this announcement will not help keep inflation down! Also, we have no alternative to our dependance on private vehicles for our travels. Are we expected to use the inefficient, unreliable and utterly useless public transportation system? Unless the Government intends on the country's economy to come to a standstill with workers not being able to get to work on time (or at all), I suggest the Government actively work on improving the public transportation systems especially in critical areas such as Kuala Lumpur, Penang and Johor Bahru. Let's not even get started on how money accrued from APs (Approved Permits) should be used!

It is such circumstances that frustrate me even further. Yes, I still support subsidies to be reduced/removed but accelerate the reduction of budget deficit by letting the ringgit appreciate further and provide good and reliable public transportation first before such hikes. Give us a chance to survive.




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