Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjong, Lim Kit Siang, in Petaling Jaya on Wednesday, 28th September 1994:
MITI must take immediate remedial action so as not to destroy the local plastics industry just to confer the national monopoly position to Titan Polyethylene (M) Sdn. Bhd.
The Ministry of International trade and Industry must take immediate remedial action so as not to destroy the local plastics industry just to confer the national monopoly position to Titan Polyethylene (M) Sdn. Bhd.
Eight small plastics manufacturers have already been forced to close down as a result of the crisis in the local plastics industry, coursed by the protection given to Titan Polyethylene (M) Sdn. Bhd. For PE (polyethelene) plastics resins in terms of 30 per cent customs tariff imposed since December 9 last year and the imposition of AP since4 April 7 for any import of PE resins.
In making the shocking revelation that eight plastics companies had shut down as a result of the crisis in the plastics industry, the Malaysian Plastics Manufacturers Association called for a total review of the Appoved Permit (AP) system as the industry faces more closures if the AP system is not revised or withdrawn.
A news report from Ipoh today said that the 100-odd plastics manufacturers in Perak are now facing an acute crisis as a result of the AP system, which allowed Titan Group to take advantage by increasing Polyethylene (PE) prices unfairly and indiscriminately.
From December last year to August, Titan has increased the price of its High Density PE (HDPE) from RM1,400 a tonne to RM2,500, a 78.6 per cent increase; with similar increases of its Linear Low Density PE (LLDPE).
Internationally, however, from April to August, the prices of HDPE and LLDPE have increased from US$540 to US$800 and from US$540 to US$720 respectively, representing increases of 48.15 per cent and 33 per cent respectively.
The situation had been made more severe as manufacturers have not been able to increase the prices of end products accordingly due to market forces, resistance from buyers and buyers’ option of going to other suppliers.
During the May meeting of Parliament I had warned that many plastics manufacturers, especially those competing for the world market, are facing the serious prospect of having to close down production within a year, as a result of the crisis created by the AP imposition to give Titan a national monopoly.
My warning in Parliament four months ago have not been heeded by MITI, and more and more local plastics manufacturers are now facing the critical decision about factory closures.
The Minister for MITI, Datuk Paduka Rafidah Aziz should stop making meaningless statement that there is no crisis in the local plastics industry when more and more companies are closing down, and should call for an emergency meeting with all local plastic manufacturers to save the local plastics industry which recorded a total turnover of US$800 million in 1993 – a ten-fold increase since 1974. Total exports last year was estimated at US$200 million, about four times the 1988 figure.