Ensuring Our Oil Bounty Will Not Be A Curse


by M. Bakri Musa
www.bakrimusa.com

With Malaysia forced to end or at least reduce its petroleum subsidy, it is well to learn from the experiences of other oil-producing countries.

There are enough lessons in the world today on how we should manage our precious God-given oil bounty. Prudently done, as in Alberta (Canada) and Norway, it would bring peace and prosperity. Anything less and it would be a curse; the new wealth would breed corruption and tear the socioeconomic fabric of society, as seen in today’s Iraq and Nigeria.

I would rather that Malaysia emulates and enhances the Albertan and Norwegian models. Malaysia should, like Canada and Norway, remove all subsidies on petroleum products. This would encourage conservation. It would also prod Malaysians into the global economic reality instead of being insulated from it.

In order for this giant step to be accepted, the government must divert the savings into a separate trust fund for use by future generations when our oil would run out, with a small portion devoted for current use in subsidizing cooking gas for the poor, and users of public transportation.

The Lessons from Norway and Alberta

Norway, with a land mass slightly larger than Malaysia and a population only twice that of Perak, ‘sterilizes’ its oil revenue by diverting it into a separate trust fund for use by future generations. The wisdom of that initiative is that the new wealth did not disrupt the social and economic fabric of Norwegian society. There was no runaway inflation as in Nigeria, and the Norwegians did not become lazy profligate consumers dependent on their new oil wealth, as with the Arabs.

The Norwegians pay the same world price at the pump for their petroleum, currently at about RM 7 per liter, nearly three times the new Malaysian price. One consequence is that while they have one of the highest per-capita incomes, car ownership among Norwegians is one of the lowest in Europe. To them, a car is simply a means of transportation, not for ostentation. Everybody knows that they are already wealthy; they do not need to flaunt it. Further, the cars on the streets of Oslo are mostly fuel efficient brands like Volkswagen rather than luxurious Mercedes. In fact there is a stiff tax for gas-guzzlers.

Among the many positive consequences are that their roads are not congested and their air less polluted.

Today the Norwegian Petroleum Trust is the world’s second largest sovereign fund, and fast expanding. It may have already exceeded half a trillion (500 billion) dollars. When the oil wells run dry, as they inevitably will, the Norwegians could still enjoy their present lifestyles as the Trust Fund’s income could cover the country’s budget till perpetuity.

Like everyone else, the Norwegians do not like paying high prices for petrol, or anything else for that matter. However, they willingly do so because they see the direct and tangible benefits of such an enlightened policy.

The Albertans too pay world price for their energy, with their government diverting the extra bounty into a separate Heritage Fund. Unlike the Norwegians who invest in global stock markets, the Albertans invest in their schools, universities, and hospitals. Consequently, as noted in the Economist and also from my firsthand knowledge, Alberta is the only place where the rich send their children to public schools! The University of Alberta (which happens to be my alma mater) is now regarded as one of the finest, thanks to generous funding from the Heritage Fund.

Malaysian Petroleum Trust Fund

Malaysia can improve on the Norwegian and Albertan models. We must commit to remove all subsidies on energy, and do so in a phased and predictable manner, perhaps over a couple of years. This must be coupled with a properly thought out plan to protect the poor.

For example, there must be subsidized cooking gas for the poor, and only for them. We can easily estimate the energy needs for the typical poor family, and limit the subsidy or even direct grants only for that amount, and nothing more. It should be fairly easy to devise such a poverty-ameliorating program with minimal leakage. We could model it after America’s “food stamps” program.

Likewise, we should subsidize and thus encourage public transportation. In British Columbia, season pass holders (rich and poor) for public transit get a rebate from the government. There is a public good in this; for by not using their cars for commuting, the air is less polluted and streets less congested, and thus require less maintenance.

The money saved from removing the subsidies should be diverted to a special Petroleum Heritage Fund. The corpus (or principal) would be invested locally in a broadly diversified portfolio to include stocks, bonds, real estate, and venture capital. The fund should be passive investor, concerned only with profit making.

The Norwegians limit their holding in any company to no more than 5 percent, meaning, they are in it purely for the profit potential and not to seek control or management. It is for this reason that unlike other sovereign funds (Singapore’s Temasek and China’s many funds), the Norwegians are the most sought after investors.

Like the Alberta Heritage Fund, the income from the Petroleum Fund should be used to improve our schools and universities, as well as providing affordable housing and better health care. Just as the corpus must be invested locally, the income too must be spent locally. Thus no scholarships to send students abroad, instead the money should be spent to improve local universities so as to benefit the greatest number of students.

The country now has many such trust funds, from Tabong Haji to Employees Provident Fund. All too often they serve as nothing more than as sources of cheap funds for the politically well connected. They are also not well managed.

To sell this idea, the Petroleum Fund must be professionally managed and free of political interference. This is a very high but achievable order. This means its governing board must have wide representations, including nominees of the opposition political parties and NGOs. Anything less and it would be hard to sell the policy.

Pakatan Rakyat’s leader Anwar Ibrahim rightly expressed the public fear and mistrust that the funds saved from reducing or abolishing the subsidy would be used to benefit Abdullah’s political cronies and family members. Anwar and Malaysians generally have good reasons for this suspicion.

I am not impressed with Abdullah’s proposal to provide tax rebates for car owners. If they can afford to buy a car, then they do not need any subsidy or rebate from the government.

Abdullah must also spend the petroleum dollars locally to benefit especially the residents of the oil-producing states. It is morally indefensible and politically foolish to see residents of the three states where oil is produced (Trengganu, Sabah, and Sarawak) among the poorest in Malaysia.

If Abdullah does not handle this petroleum subsidy issue wisely, it could prove to be the final straw to his downfall. On the other hand, if he could learn (a big if) from the Norwegians and the Albertans, he could not only salvage his political future but more importantly, leave a significant legacy

  1. #1 by imdavidlee on Monday, 9 June 2008 - 10:03 am

    i hav do some analysis and found that other country like Nigeria and Iran only have rm0.35 per liter, it it true??

    but i thnk world’s cheapest oil is Venezuela from South America there…

  2. #2 by lbn on Monday, 9 June 2008 - 10:07 am

    “I am not impressed with Abdullah’s proposal to provide tax rebates for car owners. If they can afford to buy a car, then they do not need any subsidy or rebate from the government.”
    I totally agree. The main concern is the consumers at large. With the hike everything is up related to transportation. More ever the rebate can be subjected to abuse. Gomen should take up commuter transport as a top priority. Pse no more privitisation. Instead of LRT, it should be MRT. Make public transport effective and efficient so that there’s no need for private tarnsport! Dream of that day………………….

  3. #3 by Godfather on Monday, 9 June 2008 - 10:12 am

    Bakri:

    Isn’t it already too late to call for Petrodollars to be put into a trust fund ? It’s like closing the barn doors after the horses have bolted. Write to Mahathir and ask him why he basically sold forward all the oil revenues to finance white elephants like Putrajaya, Cyberjaya, etc. Write to Badawi (not that he will respond) and ask him why he increased civil service pay by RM 8 billion when the Treasury said last year that all they could afford was RM 5 billion.

    We become a net oil importer by 2012/2013. No point calling for “excess” revenues to be put into some transparent managed account for the benefit of future generations.

    In the meantime, all I want is the contract to print rebate forms.

  4. #4 by limkamput on Monday, 9 June 2008 - 10:13 am

    Fifth para from the top, the word “Nigeria” should be “Norway”. i think it is an obvious mistake.

  5. #5 by clearwater on Monday, 9 June 2008 - 10:17 am

    A good article propounding tested ideas to manage our oil riches. How has Malaysia done so far? Unfortunately, much worse than Norway or Alberta but fortunately, a lot better than Nigeria. It’s only prudent to place our oil bounty for long term strategic investments in a transparent Petroleum Fund managed by top rate professionals. Do we trust the PM or any single politician to have control over our oil proceeds? No! No! No! Politicians have already squandered enough of our oil inheritance in the past and we don’t trust them to do the right thing. Fingers in the till is a particularly common political disease.

  6. #6 by Kathy on Monday, 9 June 2008 - 10:18 am

    The problem with the government is the way they think that the majority of the Malaysians will take whatever they can raise in price without any question or query. This could prove to be the first of many issues that many Malaysians will remember and continue to remember for the next general election.

    Public transportation has always been the the lowest priority to the government, unless there is a chance for money making in it. The thought of having good public transport to cut down the need for private transport is never in the forethought — need to sustain PROTON’s existence by the government.

    If the government can let go of PROTON (let it sustain on its own like any other car maker – take a leaf of lesson from the French government with its rescue plan for one of its car makers), then regular Malaysians may have a chance in getting the public transportation as they should have gotten many years ago.

  7. #7 by TheWrathOfGrapes on Monday, 9 June 2008 - 10:20 am

    Not just oil bounty. What about the bounty in tin, rubber, oil palm, bauxite, etc. Without a disciplined government, such abudance, instead of a blessing, will be a curse. Why work hard when manna falls from the heaven and black gold oozes out of the ground?

    Looks like many resource-countries are condemned to be basket cases, which resource-less countries, knowing that they have nothing, had to work doubly hard and build up their reserves.

  8. #8 by Godfather on Monday, 9 June 2008 - 10:23 am

    Badawi is already doing a balancing act, and he sucks at it. He has to make sure that the Sabahans and Sarawakians don’t rebel, and cross over to Pakatan, so he makes pledges of funds to Sabah and Sarawak. He has to ensure that there is minimal rebellion from within UMNO, so he tries to get the “right” contracts moving amongst the UMNOputras.

    In a zero sum game, the rakyat gets royally screwed, but at least it buys Badawi time until December to try to fortify his position in UMNO. We can protest all we want, but he has the FRU to spray chemically-laced water at us.

  9. #9 by yhsiew on Monday, 9 June 2008 - 10:28 am

    I am afraid greedy, unscrupulous politicians will try all sorts of method to have a “good go” at the Petroleum Trust Fund, if it ever being set up.

    The same happened to our EPF fund many years where some errant people attempted to “have a go” at it. Unfortunately, they did not succeed.

    Let us have a full-blown, trustworthy, independent ACA Department set up before talking about the Petroleum Trust Fund!

  10. #10 by yyh on Monday, 9 June 2008 - 10:28 am

    bakri

    you must be away to Mars for holidays. Savings for the future generation?
    let me tell you where’s the money going to go. inflated infrastruture projects with minimal returns. how about a 2nd link where the cost pop up by 77% in less than 1 year to RM4.8 billion. how about opening up more camp sites for NS which produces more deaths than benefits. incidentally, they see it fit to use live bullets in trying to make a man out of sissees. how about a double rail track from Seremban to Gemas which cost billions (RM3.5 billion) so that the trains can run at breakneck speeds but empty. Thats just part of the RM20 billion we are going to throw away fro this double rail track.
    and how about spending on transportation in Port Klang. RM4.7 billion went into a huge white elephant and the benefactors were promoted to Deputy Minister and Deputy Head BBC?
    Or transportation to space, like thinking of buying the used Soyuz capsule for US$65 million? or spending another RM100 million to send another Malaysia BOleh space traveller to do some teh tarik stunts. Oh, we are rich enough to spare that.
    Bakri, do you want me to list further? schools and education? this has to wait and afterall around 30% of the schools are still without water and electricity! mind boggling isnt it and thse statistics are provided by the Government. by the way, these schools are mainly sited in rural areas where the majority are Bumiputeras which this government has swear to protect and assist! Isnt it ironical?

  11. #11 by yhsiew on Monday, 9 June 2008 - 10:30 am

    In my previous comment:

    “Unfortunately, they did not succeed.” should be replaced with “Fortunately, they did not succeed.” Sorry about the mistake.

  12. #12 by cheng on soo on Monday, 9 June 2008 - 10:40 am

    Both Norway (less than 6 m) & Alberta (less than 3 m, a province of Canada), had small population, and very high income, good public transport, schools etc, their leaders have foresight (or their ppl demand this?), their future genertions are blessed !
    But here, afraid that is too late now, with most of the money already disappeared !

  13. #13 by chiakchua on Monday, 9 June 2008 - 10:44 am

    I’m in total agreement with what you write. The same fund had been set up by Singapore for their rainy days. Only the BN government semua boleh! When someone with the right mind speak out on the proper ways the government should adopt, they will always be shot down as ‘racist’! Where got hope for this country with so many brainless ‘bolehmen’. Shame on these people; it is only during such critical moment that they are fighting for survival by simply raising the oil price because they are running out of fund to keep giving hand-outs to their cronies and to pay the super large civil service force! Again someone will say this remark is ‘racism’ oriented, sigh!

    Yes. how could we trust the cat to look after the fish? With the kind of ‘brain’ and ‘arrogance’, how could we trust the UMNOputras to take care of the fund if it is still not too late to set up one. Susah-lah.

    Though I’m fed up with the increase in fuel price, I also feel the rakyat should pay for the market price in order they will exercise their wisdom on their consumption. The NEP has already made our Bumiputra in such a bad state, heavily subsidised fuel price and food items will also paralyzed the rakyat in the long run. The big saving on subsidy should only be used to partially help those who are really poor. However, when you think of the dishonest bolehmen who are in charge of the large fund, you are really in a doldrum of don’t know what to do.

  14. #14 by limkamput on Monday, 9 June 2008 - 11:05 am

    I think the issue is not whether we should follow this or that models when managing our wealth. All models work if we have these few important things:
    1. whether our leaders have money sense;
    2. whether our leaders are corrupted;
    3. whether our economic system is saddled with renting seeking and cronyism complexes;
    4. whether our leaders are enlightened and competent in managing a rapidly modernising and globalising economy;
    5. whether our leaders care about their citizens, the environment and the future generations; and
    6. whether we have a transparent public policy formulation process able to withstand public scrutiny.

    I think we have passed the “what” stage. We have to get on with the “how” stage. Most of us know what is lacking and what need to be done. The question is how. How do we get what we all want?

    Petronas too has a Heritage Fund set up earlier. Ask them how much is in the Fund today? Ask them how much they have put in and ask them how much they have taken out. Ask them how they invest or spend the money in the Fund.

    We know we need efficient public transportation system, but where is it despite repeated promises since the early 1990s. Singapore built the MRT in the mid 1980s recession. And what did we do? Oh yes, we squandered money on tin trading, Malaysia sogashosha and later forex trading. So what is the state of our public transportation system? Other than a few miserable LRT lines that do not “talk” to each other, we do see some Rapid KL buses running around. But you must remember, before this, they killed off a relatively efficient private bus operation in KL. You should ask them how much they have squandered from the Rapid KL buses project alone – I think the amount is big enough for us to build more than one LRT lines. It is another corruption and siphoning machine, my friend, in the name of public transportation.

    We know we need to preserve our environment, but who cares. We find the cheapest way to clear land, we pursue a good for nothing national car policy, and we can’t do one thing right of on our waste management thus far.

    Yes, we know “what” but we need to know “how”. To know “how” we need competent and honest leaders and a governance system to ensure they remain so. Right now we have none. We do not have competent leaders. We do not have honest leaders. And we do not have a governance system to ensure compliance. So there is no need to talk about Norwegian or Alberta.

  15. #15 by Godson on Monday, 9 June 2008 - 11:11 am

    Hey guys….thanks soooo…much for your vote and support. Without your support we umNO-BN will not be able to fill our pockets, enjoy good life, travel overseas shopping. But the most important thing is you give us (nmNO-BN) the green card to NAIK HARGA. Dont worry, we will continue to NAIK HARGA to reward you for your continous support all these 50 years.
    Its alright if you and your children continue to suffer coz we never bother (its already 50 years) but the most beautiful part is you still continue to support us (umNO-BN).
    We know you will live, suffer and die for umNO-BN. Who cares. Yeah, we have already shown you…..WHO CARES…

    Hey..Hey…Hey…wake up lah. Dont be so bodoh lah. You dont have to prove that you are bodoh. JUST CHANGE !!!

    Just for once, ( DO IT RIGHT THE SECOND TIME ) CHOOSE PR.

  16. #16 by cvl on Monday, 9 June 2008 - 11:13 am

    Once upon a time Sabah’s bounty was its timber and she was filthy rich to the extent an ingrown toe nail would be a convenient excuse to go to London to have it treated and some. There was so much money, she could buy an executive boeing jet liner, and some to the extend of financing other poeples casinos’ habit.

    Those were the early 70’s, and so this is no fairly tales.

    I bet Sabahans of those era missed so much being a millionaire each and everyone of them.

    What’s is oil anyway.

  17. #17 by pulau_sibu on Monday, 9 June 2008 - 11:17 am

    The political circle is for Sarawak/Sabah/Trengganu to be bullied by the other states, since you all consider ‘my’ oil as ‘our’ oil. Then BN federal government bullies all the people by sucking the wealth from the oil. This is like black swallowing black. If you don’t feel bad for Sarawak/Sabah/Trengganu, BN would not feel bad for you.

  18. #18 by Godfather on Monday, 9 June 2008 - 11:22 am

    Limkamput:

    Someone mentioned that there are thousands of RapidKL buses rotting in the sun somewhere in Pahang. These are now scavenged for spare parts. Is there any way of verifying this, now that you have your own blog ?

  19. #19 by Kuching on Monday, 9 June 2008 - 11:24 am

    –Totally Disagreed with this, Most people are forced to buy a car because Public Transportation is almost non-existence and not practical considering the long distance which people need to travel here in Sarawak.If you think people buying a car are rich, then I think there is something wrong with your reasoning. The Cash Rebate should increase to RM6250 instead of a mere RM625 considering the taxes we have to pay when purchasing a car. Hey, Lim Kit Siang, not all of us are rich and the cars we own are in danger of getting repossessed because we can no longer pay for it. There are no alternatives for some people here in Sarawak.

    Another thing is, Petrol prices have been rising since Abdullah come up in Power( Not that he is blamed for the increase ). Did he improve the Public transportation during these 4 years? Did you PRESSURE him to improve Public transportation? He rather spend it on sending a space
    tourist to space, monsoon cup, enriching himself, family and cronies. Do you think you CAN educate such a man and his cabinet? Be realistic.

  20. #20 by limkamput on Monday, 9 June 2008 - 11:45 am

    Godfather,
    I am not being harsh to PK, please understand. I am worry they will be at the loss when suddenly power and responsibility are thrust to them. It is not as easy as most think even one may have a degree from Oxford. I have come across many Phd economists from the World Bank and IMF who can only talk eloquently but is completely devoid of practicality.

    With regard to Rapid KL buses, I think our job is done by raising the issue here. It is for Tony Phua to find out and for Nor Mohamad and his advisors to answer.

  21. #21 by limkamput on Monday, 9 June 2008 - 11:47 am

    Sorry,…..I have come across many Phd economists from the World Bank and IMF who can only talk eloquently but are completely devoid of practicality.

  22. #22 by mauriyaII on Monday, 9 June 2008 - 11:49 am

    Hello Bakri,
    Thanks for an informative article on how other modern and progressive and enlightened nations save for a rainy day when the God-given natural resources are no more.

    To suggest that the BN government do likewise is like asking the corrupted scums in the present government to repent their wayward ways and become good and caring leaders with the welfare of the rakyat at heart.

    We can have as many trust funds as we desire but if their management is left in the hands of politicians of the calibre of Mamakthir or his cronies in the AAB government, then it is advisable not to entrust them with anymore trusts.
    They would not only squander it on many more white elephants but would not have second thoughts in siphoning off a good part to themselves and their cronies. To date has the government released how the oil revenue of Petronas was utilised? Was it for the benefit of the rakyat?

    So long as these issues are not explained, it is futile for people like you to do research using up your valuable time and assets to advise the BN. It would be throwing pearls to swines or giving a garland of roses to monkeys!

    We the rakyat understand your intention in writing the article, but do you think the Umnoputras who are in control of the government care whatever happens to the poor rakyat? Far from it.

  23. #23 by pkrisnin on Monday, 9 June 2008 - 11:50 am

    Lets not forget Kelantan.

  24. #24 by mauriyaII on Monday, 9 June 2008 - 12:02 pm

    Talking about thousands of RapidKl buses rotting in their graveyard, isn’t it clear they are the replacements for newer and more expensive buses where the powers be can get their kickbacks?

    What about the hundreds of police patrol cars lying idle at traffic police stations? In fact there are more patrol cars than traffic policemen in these stations?

    The fact is these people want the best and the latest! They don’t care as it is not their hard-earned money that is being used for such extravagance.

    Wolves in any other garbs are still wolves!

  25. #25 by nazryan on Monday, 9 June 2008 - 12:17 pm

    However sceptic I may be for the future, I still have faith in my fellow honest Malaysian. We do have many capable Malaysians here in the country and abroad, whom willing to work ourself out once the present BN gomen is out. I do believe that Malaysian abroad will come back if the political situations changed.

    Thus give ourselves a chance, what ever ideas/ case studies/ references that is already proved to be successfull elsewhere can be replicate here. Same goes for the Petroluem trust fund. Off course these need to be cover from all aspect & position, full proof and not just having a trust fund for the sake of it. We have many failed trust fund (the famous Amanah Saham Johor, Selangor) that were mismanaged.

    On another matter.
    The current gomen seems never learned from history. I strongly suggest then when PR take over – all Malaysian great bail out, mismanagement, fail project (which include Proton), mega project etc, made into a new subject call “Mismanagement of a country”. The subject will detailed out whom, where, how, why and when it failed and how we learn from it. I also proposed that this subject be taught at all universities, school and elsewhere…… Hehehehe…..cheers to all!

  26. #26 by bennylohstocks on Monday, 9 June 2008 - 12:18 pm

  27. #27 by leealex24 on Monday, 9 June 2008 - 12:28 pm

    Sometimes, when I read these posts, it’s as if Malaysia’s only industries are oil, palm oil and rubber. How primitive can we be? It’s high time (the government have often neglected), to also develop world class competencies in other fields e.g. banking, IT or value-adding services. It’s as if the everyday, we hear the government keep talking about how to distribute our finite wealth as opposed to actually take proactive measures to develop future industries to generate more wealth for the country.

  28. #28 by cheng on soo on Monday, 9 June 2008 - 12:42 pm

    leealex24 Says:

    Today at 12: 28.14 (9 minutes ago)
    (Sometimes, when……Malaysia’s only industries are oil, palm oil and rubber. How…… to also develop…. in other …e.g. banking, IT or value-adding services. It’s as if ……hear the government keep talking about how to distribute our finite wealth….. to develop future industries to generate more wealth… country.)

    With the present quota system on higher education & scholarship, I dont see how we can develope knowledge base economy??

  29. #29 by dawsheng on Monday, 9 June 2008 - 12:43 pm

    The special committee set up by MTUC General Council decided to launch an extensive campaign to persuade the Government to legislate a minimum wage of RM900 throughout the country.

    Currently the Employment Act which sets minimum conditions on annual leave, sick leave, public holidays, working hours and a few other terms and conditions is silent on the basic and most essential issue of wages. Absence of a specific provision on wages has led to widespread exploitation. The Employment Act 1955 should be amended to stipulate a minimum wage of RM900.

    Minimum Living Wage

    Minimum wages constitute an integral and a very important element of the trade union movement’s holistic approach towards creating, sustaining and improving the quality of live of our workers.

    We do not believe that any reasonable person will dispute a worker’s right to the most basic elements listed.

    Survey on Minimum Wage

    A study of wage scales in 165 companies showed that even in major towns such as Penang, Ipoh, Shah Alam and Johore Bahru, unskilled general workers are paid as low as RM300 to RM350 per month. Union representing Felda Trading employees in Kuala Lumpur reported that their minimum wage is RM273.00

    Overall, the study shows that 46.2% of the company’s involved are paying a minimum wage below RM400 per month, and only 15.4% of the companies pay more than RM500.

    Commenting on Government’s statement that wage increase must be based on productivity, Rajasekaran said that a minimum wage must be put in place before implementing productivity related annual wage increase. He insisted that a minimum wage must take care of workers basic needs.

    Action Plan

    Since this important issue has remained unresolved for too long, MTUC will launch a series of action to find an acceptable solution.

    · Initially 10,000 postcards seeking the support of the Government will be forwarded to the YB Minister of Human Resources and the YAB Prime Minister of Malaysia.

    · Members of the public who have expressed support for our campaign will be requested to write to the Government.

    · All 230 MTUC affiliates will table this proposal for discussion at their General Meeting and Delegates Conferences

    · Appeal seeking the support of all members of Parliament and Senate will be sent out.

    By setting and implementing a minimum living wage of RM900, Government will be able to effectively address :

    – industries need for manpower
    – reduce dependency on foreign labour
    – eradicate poverty
    – improve purchasing power
    – strengthen and increase manufacturing, and
    – facilitate positive economic growth.

    With 2 million foreign workers in the country Government is in a good position to discard and end the low wage regime.

    (G. RAJASEKARAN)
    Secretary General

    Petaling Jaya
    9th June 2000

    http://www.mtuc.org.my/MINIMUMWAGE900.htm

  30. #30 by ng say eng on Monday, 9 June 2008 - 12:51 pm

    I am not totally against removal of fuel subsidy. But before they cant do so, the government should disclosed the full detail of petronas account to public, how the excess funds are spent, how much allocation to improve the transport system. To remove import tax on car which i think the government has taken a big chunk of tax from consumers. Of course no further acquisition of submarine by Najis

  31. #31 by Godfather on Monday, 9 June 2008 - 12:59 pm

    No further acquisition of submarines by Najis ? Hahaha…they are now talking of amphibous vehicles (APVs) and the replacement for our Nuri helicopters. These clowns think nothing of giving away a RM500 million contract to Perimekar, a company controlled by unproven people, to “service” our submarine logistics. Of course, we now know that Perimekar is linked to Razak Baginda.

    Do you see holograms now attached to medicine packs, and to liquor bottles ? Just to certify they are genuine ? These cost us over RM200 million a year.

    Stealing is a hard habit to break.

  32. #32 by dawsheng on Monday, 9 June 2008 - 1:09 pm

    40% of Singapore households will be millionaires by 2017, forecasts wealth manager.

    http://www.todayonline.com/articles/252410.asp

  33. #33 by yin_bak on Monday, 9 June 2008 - 1:11 pm

    Removal of subsidies should not be a drastic surprise like the government always does. ‘Esok naik minyak, ini petang baru cakap.’ This stupid scenario is actually placing the rakyat as a ‘sitting duck’, subject to sudden policy changes.

    If the Government is really sincere to improve Malaysia by eleminating subsidies. they should provide a MASTER PROGRAMME on when the stages of the subsides will be phased out. Then rakyat can actually be prepared for the worse and most important their revised future budgets. Not forgetting that the government themselves must improvise the welfare of the rakyat at the same time to compensate the matter when the phasing out takes place(affordable transportation, medical, education, housing)

    Just imagine those rakyat whom before the price hike was in the following situation (simple kindergarden scenario):
    – just bought a new car
    – just bought a house
    – just accepted a job with a location futher away from home
    – just spent holiday with family
    – just took up personal loan to expand business
    – just got pregnant
    – Mat rempit just upgraded motor horsepower
    – etc, bla.. bla.. bla.!!

    Might as well those poor guys abandon their agenda if they knew the was a severe price hike. But now is to late for them. Money had already been spent and now they will have to face a deficit budget!!!

    Be prepared..Crime would definitely increase ma!

  34. #34 by ShiokGuy on Monday, 9 June 2008 - 1:16 pm

    By the time we come to start the trust fund, our well has drained dry!
    Petronas account is not an open book, why?

    I don’t mind paying more for petrol as long as I know our money is not used to enrich a few cronies only

    http://shiokguy.blogspot.com/2008/06/petrol-price-hike.html

    Shiok Guy

  35. #35 by TheWrathOfGrapes on Monday, 9 June 2008 - 1:27 pm

    /// leealex24 Says:
    Today at 12: 28.14 (51 minutes ago)
    It’s high time (the government have often neglected), to also develop world class competencies in other fields e.g. banking, IT or value-adding services. ///

    This is the crux of the problem. It is easier said than done.

    Decades were devoted and billions of ringgits were poured into the blackhole called Proton, and what has Malaysia got to show for it?

    It all boils down to human resources. How to develop world class competencies when the government does not want to use world class people, but instead give the top jobs based on kulitfication?

    Not that there are no world class people in Malaysia – many of them are unwanted in their country and had to seek their fame and fortune in other countries.

  36. #36 by procol on Monday, 9 June 2008 - 1:35 pm

    Is there any comprehensive valuation, study or calculation of the true cost of the price hike in fuel being published anywhere?
    I think the gradual removal of subsidy is fine provided it does not create any other significant problems. Also, the govt should make sure the necessary infrastructures,system,etc are in place to compensate for the adverse effect as a result of the price hike. For e.g., it’s a fact that our public transport isn’t really something to boast of. Where’re the reasonable and efficient alternatives? Can’t expect us to walk or cycle to work in this climate.
    Transportation is an essential aspect to maintain a healthy economy. Wouldn’t the productivity be reduced as biz operators could no longer afford or be willing to incur extra expenses to maintain the level of the business operation? What about reduced spending per household as a result of inflation? Would the cumulative effect of all the relevant factors cause the GDP to be further dampened? what is the true cost to the nation as a result of the hike? Hopefully, we don’t end up with net loss.
    Price hike may be a way to force us to use petrol more efficiently, to control congestion and pollution. With price hike, people would be forced to travel only when necessary. Car pooling may spring into people’s mind more often from now on. Yes that may be good. However, there’s the seat belt regulation. Good for safety. What if a group of 6 have to drive to someplace and the vehicle has only 5 seatbelts? They’ll be forced to travel in 2 cars and that’s not really helping.
    On another point, would it be a good suggestion that since we have to change our lifestyle and in the absence of a good alternative like public transport, if one has to buy a car, shouldnt the govt reduce the tax on cars like VW or any other cars with good fuel efficiency? Cars with good fuel efficiency and engine that burns cleaner would be good for all rite? Perhaps the govt should help us purchase such cars at a hugely discounted rate.

  37. #37 by kentutoyol on Monday, 9 June 2008 - 1:37 pm

    The government have made a simple mistake which can be very destructive to our nation building. This fuel price issue should have been brought to the parliament for debate instead of a haste implementation. Members of parliament will for sure be able to contribute their ideas which can be shared and the government can go for the best option.

  38. #38 by gundam on Monday, 9 June 2008 - 1:54 pm

    “It is morally indefensible and politically foolish to see residents of the three states where oil is produced (Trengganu, Sabah, and Sarawak) among the poorest in Malaysia.”

    sarawakians will be contented when santa badawi goes to town and distribute some ‘goodies’ to them.

  39. #39 by rainbowseahorse on Monday, 9 June 2008 - 1:57 pm

    I strongly believe the Malaysian Government [email protected]*KED UP BAD by selling our crude oil futures at way below current market price and NOW HAVE TO make up for the shortfall.
    This reminded me of the time that dim nit wit Daim (when he was finance minister) lost millions of Malaysian foreign reserves in foreign exchange.

  40. #40 by HJ Angus on Monday, 9 June 2008 - 2:04 pm

    In a perverse way, the sudden oil price hike may be a blessing in disguise.
    It really focuses the thinking of most Malaysians that the government is now bankrupt of ideas.
    Just imagine that – we are truly a blessed nation with so much natural and human resources and our BN government has squandered all that.

    This oil shock could be the last nail in the BN coffin.
    http://malaysiawatch3.blogspot.com/2008/06/opening-petronas-accounts-and-toll.html

  41. #41 by cheng on soo on Monday, 9 June 2008 - 2:04 pm

    Winners in this petrol hike,
    a) the car rental co. each car get RM625 cash rebate, but actually, the petrol is pumped in by customers.
    b), 2nd hand car dealers, suddenly, all want to pay 3rd party insurance & road tx, can get RM625 lah! still got net profit for small cars. (but may suffer drop in sales for 2nd hand big cars)
    c) petrol kiosk owners, suddenly get extra 78 sen/litre for petrol in their underground tanks. RM19,500 if got 25,000 litres

  42. #42 by lbn on Monday, 9 June 2008 - 2:34 pm

    Don’t talk about setting up a fund now. There’re so many trust funds. One that I know is the Energy Trust Fund from the electricity providers. What is the point? Alot of money but not properly utilised. So don’t waste time! PR should put the pressure on BN to do up a comprehensive public transport and get it implemented soonest. Otherwise it’s just talk only!

  43. #43 by Damocles on Monday, 9 June 2008 - 2:40 pm

    There is nothing much that Malaysians can do but to hope that the PR will clobber the BN by Sept 16th.
    Nothing else will do; especially empty promises from the BN.
    Hopefully, once the PR is in power, it will put all those corrupt politicians, present & past, together with their beneficiaries on trial to recover all the ill gotten gains.
    Also, let them cry all the way to jail instead of laughing all the way to the bank.

  44. #44 by drngsc on Monday, 9 June 2008 - 2:48 pm

    I share many of MBakri’s view, except that I think Mr Bakri forgot to mention that in Norway and in Canada, there is a rule of law and transparency in government. The citizens and government have the nation at heart. It is Negara first, not Bangsa.

  45. #45 by rainbowseahorse on Monday, 9 June 2008 - 3:01 pm

    At first, on the face of the sudden and drastic fuel raises, I thought that somebody closed to that Bodohwi gave him some very bad advices in order to hasten his departure as PM. A few days past and nothing BIG seem to be happening by way of that Bodohwi being ouster out .

    Then I though and puzzled over that mystery, and another theory emerges which was reinforced by some reports and also by fellow bloggers. Someone must have screwed up badly in crude oil futures trading and the time for oil delivery is here and there is not enough money to make up for the shortfall. If that trader has sold Malaysian oil futures at closed to the USD100 mark, now with world crude oil trading at USD135, there is at least USD35 p/barrel shortfall to make up for. Haiyoh-yoh! That means RM113 for EVERY BARREL of oil promised for delivery NOW. 1 million barrel will mean RM113 million and RM1.13 billion for 10 million barrels. No wonder that Bodohwi has to hastily raise fuel prices from 40 to 63 percent! That someone MUST Have ONLY JUST informed him of the bad news. Remember that Diam when he played the world money market with our Malaysian foreign reserves?? He HELPED Malaysian LOST millions!

  46. #46 by yhsiew on Monday, 9 June 2008 - 3:02 pm

    The petrol rebate system of RM625 will not work because a guy can buy in 10 scrap cars at RM300 each, get every one of them registered and a tax disc. 12 months later the guy takes the 10 registration papers to a post office to get a rebate of RM6250.

    Assuming the money spent on each tax disc is RM200 or RM2000 for 10 cars, he still can make a profit of RM6520 – (RM300 X 10) – RM2000, i.e. RM1520, or even more, if he dismantles the scrap cars and sells the parts to garages.

    In the subsequent years, the guy will make a profit of (RM6520 – RM2000) or RM4520 annually (even though the cars no longer exist). Soon our petrol rebate system will become a means by which ordinary people make a quick buck!

  47. #47 by Bobster on Monday, 9 June 2008 - 3:11 pm

    BN bukan lagi Barang Naik.

    BN akan jadi Bankrupt Negara!

    Negeri-negeri yang paling kaya ie Selangor and P.Pinang jatuh ke tangan pembangkang. BN kehilangan sumber kewangan. Justera ini, Petronas sekali lagi dirogol and hakikatnya rakyat menderita!

    BN BOLEH!

  48. #48 by wantonhead on Monday, 9 June 2008 - 3:27 pm

    And why not channel the funds for R&D into bio-fuel, bio diesel and the likes. The goment could do this ten years ago, but perhaps it would kill petronas in the way. Profit it what matters to them most … it is most obvious.

  49. #49 by ahkok1982 on Monday, 9 June 2008 - 3:52 pm

    Well, First things first, people living in Malaysia only have themselves to blame for the mess that they are in right now. Of course, the education system is the root of all problems but then again, shouldn’t the parents themselves teach their children how to think logically and have better analytical skills?
    So right now we have a 40% increase in petrol and 60% increase in diesel. So what? I dont really see that many people out to protest on this issue. Sure there have been a handful of people out there holding banners and shouting slogans but then when you look closer, what is gained from such a move?
    – Did the people in gov do anything? Ans: No
    – More people spent on petrol to travel to places to protest

    All in all, it is equivalent to nothing being done. The people living in Malaysia just accepts the fact that making a living becomes more difficult. Many people condemn AAB for saying “change your lifestyle” but then does exactly that.

    So in the end, those who do nothing but just change your lifestyle as per the advise of AAB should just shut up and don’t complain. You did not do anything to change your condition so live with it.

  50. #50 by riversandlakes on Monday, 9 June 2008 - 4:15 pm

    “Let us have a full-blown, trustworthy, independent ACA Department set up before talking about the Petroleum Trust Fund!”

    I second that motion!

  51. #51 by lakilompat on Monday, 9 June 2008 - 4:22 pm

    No matter what happen, when 2molo come there are still people supporting the Barang Naik party, wat we can do just wait in Malaysia and died, wait for other the govt. to confiscate our wealth, wait for rising criminals to harm us, let to see our children starving and losing their future savings.

    Nowadays, we have to save less for our childrens, what’s wrong with Malaysian children, why Singaporean children are richer, while Malaysian children have to suffer for the leader’s sin.

  52. #52 by raverus on Monday, 9 June 2008 - 4:27 pm

    Brilliant thoughts!

    Wonder why the whole dodo-cabinet can only come out with half past six solutions. What a joke… behind the smoke screen there is a huge doubt of cronyism! Just too damn obvious!!!

  53. #53 by cancan on Monday, 9 June 2008 - 9:49 pm

    When the clowns act,there is no laughter.

    Link: http://www.kingsmary.blogspot.com/

  54. #54 by isahbiazhar on Tuesday, 10 June 2008 - 5:16 am

    Abdullah is already thinking of saving himself after the close knit cronies had left or leaving .They had given the wrong advise.The world is an example.They wanted to enrich themselves but the ralyat realised and put a halt to it.Now he has to scratch his head and tell all his advisers to wear a different thinking cap.They have started and the result no more subsidies.I was told that the price of chicken will touch RM12a kilo but importred frozen ones will come to the rescue.So Abdullah will import good ideas soon and save the nation.Already he is thinking of withdrawing social welfare benefits and introduce food coupons so the lazy will work for the material.In this way the government will not allow anyone to go hungry.If you are in KL you can get free food from organisations which have indirect monetary support.It is a good move because some people are too old to work and the lazy will know that they cannot just live on food.They need the little bit of luxury.

  55. #55 by lakilompat on Tuesday, 10 June 2008 - 9:08 am

    “Well, First things first, people living in Malaysia only have themselves to blame for the mess that they are in right now. Of course, the education system is the root of all problems but then again, shouldn’t the parents themselves teach their children how to think logically and have better analytical skills?”

    Blame the goons dun blame the people, the people are innocent, they pay their due taxes.

    Most successful people don’t rely on their parents, like Lim Goh Tong, Lee Ka Shing, Bill Gates, Michael Dell, Alan Greenspan, Bill Clinton, Barrack Obama, Hillary Clinton, Sir Elton John. The parents are there to feed u and ensure u r strong enuff to endure tomorrow challenge, the future rely in your own hand.

  56. #56 by lextcs on Tuesday, 10 June 2008 - 4:01 pm

    Godfather, God bless you.

  57. #57 by Jack Daniels on Tuesday, 10 June 2008 - 6:59 pm

    When we talk of high tranport cost, I believe there are 2 major costs involved in transport cost;
    a] fuel cost
    b] vehicle cost (which include basic vehicle cost + custom duty, govt tax)

    Since govt said our previous fuel cost compared with countries all over the world was cheap so govt raised it, I think it’s fair for rakyat to compare our car cost (especially our car custom duty) with countries all over the world.

    That way it’ll be fair and govt must bring down our car custom duty since our custom duty for car/vehicle is the highest in the world and because of this our transport cost is so high.

    I urge govt to cancel vehicle/car custom duty so car/vehicle cost is comparable with other countries around the world just like how govt compare our fuel cost with other countries.

  58. #58 by Quick Thinking on Wednesday, 11 June 2008 - 6:09 pm

    I agree with Cheong On Soo statement.

    Do you know that a junior worker in Alberta oil sand industry can easily earn over USD100,000 annually? With such an income what is the problem for them to pay the market price for petrol. But average Malaysian earning is about USD12,000, is it fair for us to pay the same price for petrol?

    I known a lot factory workers n petty traders friends in Butterworth, Penang earning less than RM1,200 monthly. To take out extra RM100-RM200 for petrol is already a burden to their family, what about price increase in food, rental, school bus and other necessities that might easily cost them another extra RM300 in near future? How their family is going to survive? Their family will
    be ruined because husband and wife is going to quarrel over money everyday, how can they have family happiness?

    So, please don’t plan big and long term if a lot of families are going to suffer here and now. Feed them well and let them have a stable life with whatever resources we can find in Malaysia first before we move forwards.

  59. #59 by saiful on Thursday, 12 June 2008 - 7:59 am

    yerp….its most true for that solutions………………

    It should be utilized for public transportation enhancement………not just subsidize

    but Its just not like LIM KIT SIANG think……u’re typical politician Mr Lim, everything seems wrong to u……

    Be more reasional like yor son…..you might capturing more voters

You must be logged in to post a comment.