Reconsider and withdraw approval for price increases for petrol, diesel and fuel oil

Ketua Pembangkang and DAP Secretary-General, Mr. Lim Kit Siang, today issued the following statements (22.12.1973):

Call on the Government to reconsider and withdraw its approval for price increases for petrol, diesel and fuel oil by corresponding reduction of government duty

The government approval of price increases for petrol, diesel and fuel oil will fan further the flames of inflation. Premium grade petrol goes up 34 cents a gallon, regular petrol 24 cents a gallon; gas oil and diesel 11 cents a gallon and fuel oil, 5 cents a gallon.

These are pretty hefty increases, and will lead to increases in transport costs for goods and persons, whether motorists or non-motorists.

This will also be another excuse for another round of increase of prices of locally manufactured goods.

The assurance that has been given by the Primary Industries Minister, Datuk Taib Mahmud, that the increases should not contribute to higher prices for manufactured products and that the government would deal severely with any attempt of profiteering will as usual be meaningless and without effect, just like all other government assurance inside and outside Parliament these past years.

Experience of these past years have shown that the Alliance government has neither the will, capacity or machinery to deal with profiteering at the manufacturer’s end and prevent prices from being marked up at the least possible excuse. This time, it will be no exception. In the end, it will be the poor consumers who will suffer.

The government approval for the price increases for the petroleum products, timed after yesterday’s Parliament meeting when the Dewan Rakyat recesses for two weeks so that it would not immediately be the subject of Parliamentary disapproval and Opposition challenge, shows that the government’s expressed concern about the adverse effects of inflation are not matched with deeds.

This is particularly so when in this case, the increases in petroleum products could have been avoided, for the following two reasons:

1. The Malaysian government imposes a very heavy duty on the petroleum products, so much so that 60% of the price of petrol and diesel paid by the consumers go to the government’s coffers. In view of the very grave inflation, which has exceeded 10% this year and which the Finance Minister has at last realised is the ‘No. 1 Economic Problem’ for Malaysians, the government should reduce the duty on petroleum products proportionately to keep their prices as before. In other words, the government should absorb the increase by collecting less duty.

2. Malaysians must be able to benefit from the fact that Malaysia is herself a petroleum producing country. In fact, our petroleum production has exceeded our needs for self-sufficiency in domestic consumption.

Our petroleum production is estimated to exceed 35 million barrels in 1973 or 95,000 barrels per day, while our domestic consumption is estimated at about 84,000 barrels a day.

With more oil strikes off the east coast of Peninsular Malaysia, and the off-shore areas of Sabah and Sarawak, the production will be stepped up dramatically in the coming years. Then there are natural gas finds too.

It is ridiculous that while Malaysia’s crude petroleum production exceeds consumption by not less than 11,000 barrels per day, our consumers cannot enjoy any benefit from such petroleum production through stable prices for petroleum products. Malaysia might as well be a non-petroleum producing country as far as Malaysian consumers are concerned.

Despite our petroleum production exceeding our domestic needs, we are still largely dependent for our crude petroleum supplies from the Persian Gulf States, while our crude petroleum are largely exporter.

Malaysia must set up more oil refineries to refine Malaysian petroleum output. The DAP wants the Ministry of Primary Industries to immediately draw up a scheme whereby Malaysian consumers can benefit from our petroleum production, in keeping down the price of petroleum products.

The DAP also calls on the government to reconsider its decision to approve price increases and rescind the decision, and through reduction of proportionate rates of government duty on petroleum products, return these prices to status quo.