KUALA LUMPUR: Angry Malaysians took to the streets of Kuala Lumpur and the northern town of Ipoh on Thursday after the Malaysian government increased pump prices by 40 percent overnight.Led by opposition parties, protesters said they would not let up until the government reviews its decision and reinstates fuel subsidies.
Malaysians who have relied heavily on government subsidies for many years are waking up to a new reality.
Even though Prime Minister Abdullah Badawi assured motorists on Wednesday that petrol will be sold at a 30 sen, or 9 US cent, discount to the prevailing market rate, protesters are still fuming.
Many could not comprehend why Malaysia – an oil-producing country – cannot continue the fuel subsidies amid soaring prices and a slowing economy.
Teo Kin Teng, a translator, said: "We produce so much oil – import the poorer quality one and export our high quality one – why can't the government use the proceeds to subsidise the people? The increase is not making sense."
Some blame national oil company, Petronas, for not being transparent. Others are also unhappy with the US$195 or RM625 annual cash rebate for owners of cars with engines that are 2 litres and below.
Joe Yap, a sales representative, said: "RM625 divided by 12 is only RM50 a month. Every month we have to pay RM200 to RM300, so what's the subsidy?"
"I want to see how the road transport department returns the rebates to the people. It will be a big mess, I can assure you," said Teo.
PM Abdullah said cutting fuel subsidies will save the country US$4.3 billion and the money can go towards improving food security, including subsidising imported rice, flour, bread and cooking oil.
But many were not convinced.
R Ragunanthanan, a lawyer, said: "He's tempting fate. People are very angry. Paklah, please wake up. That's what I want to say, wake up now."
"24 hours before he announced this price increase, he said he would only increase it in August. Five years back, we elected for him and now this is what he's doing to us," said Yap.
Capitalising on this, opposition leaders are adding fuel into the fire.
Tan Kok Wai, opposition lawmaker, Cheras, said: "What about the government spending? Have they embarked on thrifty campaign on government spending?"
Tan Seng Giaw, another opposition lawmaker, Kepong, said: "We have to review because the reduction in the subsidy is too much."
The country's inadequate public transport system means a lot of people will still have to rely on their own vehicles to commute.
Analysts said Mr Abdullah is taking a huge political risk with this move, especially when inflation is set to exceed 5 percent this month.
Melissa Goh
Channel NewsAsia's
06/06/08
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