by Parliamentary Opposition Leader, DAP Secretary General and MP for Tanjong, Lim Kit Siang, in Petaling Jaya on Friday, 6th May 1994:
Call on Deputy Prime Minister, Datuk Anwar Ibrahim, to direct Deputy Ministers to do their homework and to remind them to be serious with their replies in Parliament for what they say represent government policy and stand
I am very disappointed with the replies given by, the Deputy Minister of International Trrade and Industry, Chua Jui Meng, in Dewan Rakyat in the last two days on the imposition of APs since April 7 for local manufacturers to import plastic resins, namely polyethylene (PE) and polypropylene (PP).
What, Chua Jui Meng said during question time yesterday was completely different from what he said on Wednesday when winding up his Ministry’s supplementary estimates, and to distract attention from his contradictions, he made uncalled-for attacks on me.
I call on the Deputy Prime Minister, Datuk Seri Anwar Ibrahim, to direct Deputy Ministers to do their homework and to remind them to be serious with their replies in Parliament for what they say represent government policy and stand.
For instance, during the debate on the supplementary estimates in the Dewan Rakyat on Tuesday, I had raised the prob¬lems faced by plastics manufacturers after the Finance Ministry had virtually banned the import of plastic resins – PE and PP by over a thousand Malaysian plastics manufacturers.
I had also questioned why MITI had created a virtual monopoly worth RM540 million for Syarikat Titan Polyethylene (M) Sdn. Bhd.as it is the only local PE producer, and no local manufacturer could get an AP from MITI to import PE unless it could get a ‘No Objection Letter’ – NOL – from Titan first.
The conferment of this national monopoly over PE plastic resins to Titan is questionable at least on six grounds:
• Firstly, it has made MITI an agent of Titan, giving Titan the final powers to decide whether to approve APs to import PE to local plastic manufacturers through their decision as to whether to issue the NOL;
• Secondly, Titan is not able to meet the consump¬tion needs of the local plastics industry for PE, which is in the region of 300,000 metric tons. T’itan’s capacity for the local market is 140,000 metric tons (with 60,000 tons for the export market);
• Thirdly, Titan also cannot meet the specific requirements of local plastics manufacturers. For instance, Titan produces only two grades of PE – LLDPE or low-linear density PE and HDPE or high density PE. Between these two grades, there are many other grades of PE. This means that Titan can only produce PE plastic resins for general usage and cannot meet manufacturing needs for higher specification.
• Fourthly, Local buyers had faced numerous problems when contracting for PE from Titan ,-which has not been able to provide smooth and satisfactory delivery – both in term of delivery time and consistent quality of PE raw materials. These problems would be further compounded after Titan has been granted a virtual monopoly over PE since April 7.
• Fifthly, the Government has also given protec¬tion to Titan Group for its PE product when it imposed a 30 per cent tariff in December last year. This should be adequate protection. A 30 per cent import duty protection for PP product was imposed in 1992. Why is it necessary to give further protection to Titan by giving it a virtual monopoly over the PE plastic resins by the imposition of AP requirement and the ‘No NOL from Titan, No AP from MITI’ rule last month?
• Sixthly, FTZ and LMW plants complain that the imposition of AP and the requirement that they seek approval from Titan by way of NOL is a funda¬mental breach of the condition of their invest¬ment, i.e. they could freely import raw materials for their manufactures which are 100 per cent for export markets.
On the objections by plastic manufacturers that they have to get NOL From Titan before they could get APs from MITI, this was Chua Jui Meng’s reply in Parliament on Wednesday:
“Kita pun melaksanakan beberapa langkah iaitu bila satu pengilang plastik di Malaysia hendak import resin plastik dari luar, dia perlu tulis kepada TITAN untuk minta TITAN sama ada dia ada kebolehan untuk mengedarkan resin itu kepada kilang plastik. Kalau dalam 5 hari dia tidak dapat memberi satu jawapan, maka kita akan terus menge¬luarkan AP kepada fabricated plastic plant. Dari¬pada anggapan MITI, itu satu sistem yang adil, yang ‘hold the balance’ antara TITAN dengan pengeluar-pengeluar plastik di negara kita.”
On the objections by FTZ and LMW plastic plants in not being able to continue to import plastic resins, from interna¬tional markets, Chua Jui Meng said:
“FTZ atau free trade zone, saya sudah timbulkan masalah itu kepada pengurus dan dia katakan untuk kilang-kilang yang ada di FTZ atau free trade zone. ini bukan satu masaalah. Sekarang AP dikeluarkan kepada rnereka, tidak ada masaalah, tetapi saya akan check dan saya akan tanya pegawai-¬pegawai saya di kementerian sama ada ini betui atau tidak.”
However, less than 24 hours later, during question time on the same subject yesterday, Chua Jui Meng contradicted what he had said the day before.
I had in my supplementary question referred to Chua Jui Meng’s announcement that MITI would issue APs to local plas¬tic manufacturers to import PE resins if there is no reply from TITAN on NOL in five days. I said I had checked with plastic manufacturers earlier that morning who said that MITI would not issue APs without NOL from TITAN, and that there are cases where plastic manufacturers are still waiting for a reply from TITAN after applying for NOL for ten days. Furthermore, it has become very difficult for local plastic manufacturers to contact TITAN Marketing Manager who is in charge of NOL – – and the company would not even answer telephone calls – which must be immediate consequence of the evil of monopoly.
However, Chua Jui Meng shied away from his clear statement the day before – that if TITAN does not reply to a NOL application in five days, MITI would issue the AP to the local plastic manufacturer – and said instead that he would personally investigate if there are complaints that MITI had not issued Aps after TITAN had issued NOL in five days!
This is not only the height of evasion but also of irresponsibility! Either Chua Jui Meng did not know what he was talking about in Parliament on Wednesday, or he was simply deceiving Parliament and the
In this connection, I call on the Minister for MITI, Datuk Rafidan Aziz to clarify whether there is a MITI rule that if TITAN does not respond in five days to NOL application by local plastic manufacturers to import PPE resins, MITI would straightaway issue the AP!
MITI had promised local plastic manufacturers that the whole process of applying for APs would be ‘as painless as possible but as things worked out, it has become a very painful process, creating a crisis for the local plastic industry affecting over a thousand plastic manufacturers and over 60,000 workers.
On the objections of the FTZ/LMW plastic manufacturers that they have to apply for APs and NOL from Titan to import plastic resins for their manufactures which are 100 per cent meant for export markets, Chua Jui Meng started by attacking me for being more concerned about foreign investors. When I pointed that Chua Jui Meng did not know what he was talking about as LMW plastic manufacturers are local investors, Chua Jui Meng said:
“Mengenai soal AP yang dikehendaki untuk mengimport resin plastic PE dan PP di Licensed Manufacturing Warehouse dan Free Trade Zone, pada masa kini kita mengizinkan mereka memohon dan kita secara automatik mengeluarkan AP kepada mereka di Free Trade Zonedan Licensed Manufacturing Ware¬house pada masa kini.”
However, Chua Jui Meng refused to allow me to point out that no FTZ or LMW plastic manufacturer was aware that they could automatically get AP to import plastic resins – and in fact MITI officials are also not aware of this, as they insist that FTZ and LMW plastic manufacturers must also comply with the requirement to apply for NOL from TITAN.
In the interest of the plastics industry, the Minister of MITI, Datuk Rafidah Aziz should make clear firstly, that MITI would issue APs to local plastic manufacturers who do not get a NOL from TITAN in five days, and secondly, that FTZ/LMW plastic manufacturers can automatically get APs to import plastic resins.