Problems relating to Trade and Investment on Malaysia
15. Price controls |
|||
Issue |
Issue details |
Requests |
Reference |
| (1) Abrupt Hike in Electricity Bill by Large Margin | - Hike in electric power charge. - GOM raised electricity charge by 15% (excepting Sarawak State) from 1 January 2014, after two and half a year break since June 2011. Average 16.85% raise applies in Peninsula Malaysia for both commercial and industrial use. The hike has been prompted by reduction of subsidy to power generating operations. Minister Johnity Ongkili, KeTTHA estimates reduction of subsidy in the amount of RM4 Billion (about 128 billion Yen) per annum by this hike in electricity charge. |
- It is requested that GOM abolishes restrictions on entry into power supply industries. - Relative to tax incentive on investment into energy saving, eco-tax (reduction) was terminated in November 2013. In the face of power charge hike, it is requested that GOM takes steps to consider provision of incentive that facilitates each factory's investment into energy saving. |
- Electricity Supply Act - Notification promulgated by Ministry of Energy, Green Technology and Water |
| (2) Price Hike of Gasoline | - In October 2014, the rapid hike in general petroleum price for motor vehicles from MYR2.1 to 2.3 has pushed up the pressure of cost increase. In addition, GOM released "Malaysia's fuel subsidy reform (Draft) by Income", which indicates further cost increase, without, however, clear policy announcement (the scope of application, timing, etc.) and has been postponed indefinitely. => It has given rise to much confusion. |
- It is requested that GOM clarifies the application standard and timing on application of subsidy. | |
| (Action) - In order to reduce budgetary deficits, GOM raised prices on both unleaded and diesel fuel on 3 September 2013, while reducing subsidies by 20 sen per litre on RON95 (octane rating 95) and diesel. In addition, Ministry of Finance, on 8 January 2014, raised by 5 sen RON97 (octane rating 97) to RM2.80, while holding down RON95 price to RM2.1 per litre by grant of subsidy. |
|||
| (3) Change of Petrol/Diesel Prices into Internationally Linked Scheme | - Beginning 1 December 2014, GOM has changed the retail price linked to the international prices for regular petrol "RON95" and diesel fuel. This change has terminated the government's fuel subsidy scheme. The benefit to consumers will be substantial, should the low level on crude oil price continues, it is expected that fall on petrol prices can be expected. | ||
<<BACK |