By Rupa Damodaran
rupabanerji@nstp.com.my
2010/07/22
MALAYSIA'S Consumer Price Index (CPI) for June grew 1.7 per cent year-on-year, in line with expectations, indicating the central bank may be done with raising its key interest rate.
Bank Negara Malaysia has raised the main interest rate three times this year as keeping the cost of borrowings at very low levels could stoke inflation.
The latest figures show that inflationary pressures in Malaysia are still mild, economists said.
The Statistics Department said yesterday the index expanded from 111.8 to 113.7 during the month, with food and non-alcoholic beverages posting a 2.7 per cent increase.
Compared with May, the index increased by 0.2 per cent while for the first half of the year, the CPI grew by 1.6 per cent.
Standard Chartered Bank economist Alvin Liew said food-related price increases were again the key contributor to the CPI in June from 1.6 per cent in May.
But HSBC Bank Asian economist Wellian Wiranto said the pace of the food price increases was rather mild and he expects seasonal factors like Ramadan and festivities to spark a temporary increase.
Economists don't think inflation would jump due to the recent increase in the price of sugar and petrol although they expect the "modest" subsidy cuts to continue this year.
"Although last week's move signals the government's intention in removing subsidies, the pace that they adopted also indicates to us that they are much more likely to proceed in 'baby steps' rather than in a 'great leap forward' fashion - not least because they are ever-vigilant on the potential political repercussions," Wellian said.
Friday, July 23, 2010
First round of cuts
The Star Online
Friday July 16, 2010
PETALING JAYA: The Government has begun its first round of a gradual subsidy rationalisation programme, promising it would have minimal impact on families.
Describing the cuts as part of a “difficult but bold” decision to reduce fiscal deficit, the Government said it would still have to spend an estimated RM7.8bil on fuel and sugar subsidies this year.
Thus, effective today, prices of petrol, diesel, liquefied petroleum gas (LPG) and sugar have increased following a reduction of the subsidy.
Sugar is revised to an additional 25 sen per kg to RM1.90. LPG is up 10 sen per kg to RM1.85.
Petrol RON 95, RON 97 and diesel have gone up by five sen per liter. For RON 97, the Government has decided to withdraw the subsidy later and subject it to a managed float, where the price will be determined by an automatic pricing mechanism.
“This subsidy rationalisation will, according to estimates, allow Malaysia to reduce Government expenditure by more than RM750mil this year,” a statement from the Prime Minister’s Office said yesterday.
Details of the changes are available on the websites of the Prime Minister’s Office and Pemandu.
The Government also said the “long-needed” economic reforms would help Malaysia maintain the strong growth it had achieved to become a developed and high-income nation.
“We have begun a planned and fair reform of a subsidy regime that for too long has been ineffective in helping those who need it most and, over time, has become a barrier to Malaysia’s progress,” the statement read.
The prices of fuel and sugar in Malaysia would still be among the lowest in the region, it said.
It also said the Government made the decision about the subsidies following robust consultations with the people, citing the thousands of Malaysians who took part in policy labs and Open Day.
“As with subsidy reform, the Budget, the Government Transformation Programme and the National Key Economic Areas, the Government has made a determined effort to engage the public, listen and learn, and then act in the best interest of the nation,” it said.
Although Malaysia had weathered the global recession well, the Government said the country could not achieve its ambition to be a high-income nation by simply managing through a crisis.
“As the Government has consistently said over recent months, we must also implement subsidy reforms that will remove distortions in the marketplace and enable us to better target our resources on those most in need, and on investments that will provide lasting benefits for Malaysians.”
It assured that the savings from the reforms would allow for resources to be better channelled for families, communities and business growth.
“Measures such as the 1Malaysia clinics, the 1Malaysia mobile clinics, as well as the scholarships for all 9A+ and deserving students – specifically those who have done well, but come from lower income families – are made possible by such reforms,” it said.
There were three main concerns which led to the subsidy rationalisation: wrong beneficiaries, wastage and abuse.
The Government also said that businesses used twice as much subsidised sugar than households, while owners of luxury cars enjoyed cheap fuel although they could afford unsubsidised prices.
Friday July 16, 2010
PETALING JAYA: The Government has begun its first round of a gradual subsidy rationalisation programme, promising it would have minimal impact on families.
Describing the cuts as part of a “difficult but bold” decision to reduce fiscal deficit, the Government said it would still have to spend an estimated RM7.8bil on fuel and sugar subsidies this year.
Thus, effective today, prices of petrol, diesel, liquefied petroleum gas (LPG) and sugar have increased following a reduction of the subsidy.
Sugar is revised to an additional 25 sen per kg to RM1.90. LPG is up 10 sen per kg to RM1.85.
Petrol RON 95, RON 97 and diesel have gone up by five sen per liter. For RON 97, the Government has decided to withdraw the subsidy later and subject it to a managed float, where the price will be determined by an automatic pricing mechanism.
“This subsidy rationalisation will, according to estimates, allow Malaysia to reduce Government expenditure by more than RM750mil this year,” a statement from the Prime Minister’s Office said yesterday.
Details of the changes are available on the websites of the Prime Minister’s Office and Pemandu.
The Government also said the “long-needed” economic reforms would help Malaysia maintain the strong growth it had achieved to become a developed and high-income nation.
“We have begun a planned and fair reform of a subsidy regime that for too long has been ineffective in helping those who need it most and, over time, has become a barrier to Malaysia’s progress,” the statement read.
The prices of fuel and sugar in Malaysia would still be among the lowest in the region, it said.
It also said the Government made the decision about the subsidies following robust consultations with the people, citing the thousands of Malaysians who took part in policy labs and Open Day.
“As with subsidy reform, the Budget, the Government Transformation Programme and the National Key Economic Areas, the Government has made a determined effort to engage the public, listen and learn, and then act in the best interest of the nation,” it said.
Although Malaysia had weathered the global recession well, the Government said the country could not achieve its ambition to be a high-income nation by simply managing through a crisis.
“As the Government has consistently said over recent months, we must also implement subsidy reforms that will remove distortions in the marketplace and enable us to better target our resources on those most in need, and on investments that will provide lasting benefits for Malaysians.”
It assured that the savings from the reforms would allow for resources to be better channelled for families, communities and business growth.
“Measures such as the 1Malaysia clinics, the 1Malaysia mobile clinics, as well as the scholarships for all 9A+ and deserving students – specifically those who have done well, but come from lower income families – are made possible by such reforms,” it said.
There were three main concerns which led to the subsidy rationalisation: wrong beneficiaries, wastage and abuse.
The Government also said that businesses used twice as much subsidised sugar than households, while owners of luxury cars enjoyed cheap fuel although they could afford unsubsidised prices.
Friday, June 18, 2010
Resolving BP spill will take years
The Atlanta Journal-Constitution
Noel L. Griese
Wednesday, June 16, 2010
Just before the Deepwater Horizon accident, Florida spent $200,000 on a study of offshore drilling safety that concludes: “Oil spills from offshore exploration, development, production and the transportation associated with these activities are unlikely to present a major risk to Florida.”
So much for studies.
As the editor of Energy Pipeline News, I have followed the tragedy in the Gulf of Mexico with an insider’s knowledge of offshore drilling and an idea of what we can expect in the months and years ahead. Unfortunately, my background leads me to conclude that the cleanup will take years to accomplish, and compensating the victims and punishing those responsible will also take time.
Although the Deepwater Horizon may have been the first rig most Americans ever heard of, the Gulf is populated by a tangled network of 3,500 oil-drilling platforms and more than 43,000 miles of pipelines between Texas and Alabama.
The U.S. Gulf had accidents before the Deepwater Horizon burned and sank. Because of hurricanes Katrina and Rita, more than 8 million gallons of oil were spilled from coastal oil facilities and some 3.3 million gallons were spilled from a tank barge when it struck a sunken oil platform. More than 600,000 gallons were spilled from U.S. offshore oil platforms and pipelines.
Testimony before congressional committees reveals that shortcuts to safety were taken on the Deepwater Horizon to save money. The rig, which was costing BP $1 million a day, was 21 days behind schedule. So corners were cut. There’s plenty of blame to go around — for responsible party BP, rig owner Transocean, cementing contractor Halliburton, federal regulators and responders.
Based on an admittedly low-ball U.S. government estimate released in late May, the BP well blowout spilled about 500,000-800,000 barrels of oil into the Gulf through May. That compares with about 3.5 million barrels spilled off shore of Mexico over nine months in 1979 by the Pemex-operated Ixtoc I well that blew out on June 3, 1979, in the second-largest accidental spill in world history. But new estimates from a government technical committee on the amount of oil released through June 3 put the BP blowout already very close to surpassing the Ixtoc I record.
Despite vast U.S. waters, only 62 federal inspectors oversee offshore drilling in the Gulf and U.S. waters along the East and West coasts. Perhaps because its regulatory arm is understaffed, the Minerals Management Service quickly granted permission for BP to take the risks that resulted in the accident.
MMS also collects about $13 billion in annual royalties from the oil industry. This dual role of collecting revenues and enforcing safety put the agency in a conflict of interest with itself. Secretary of the Interior Ken Salazar is in the process of splitting the various MMS functions into three separate offices in an effort to minimize future conflicts of interest.
Despite our experience with the Exxon Valdez disaster in 1989, the response to the Deepwater Horizon spill was initially disorganized and inept. Even today, almost two months after the blowout, only a relatively few skimmers are in the Gulf cleaning up oil floating on the surface. Deployment of ocean booms to protect shorelines has been basically ineffective.
The Unified Command responding to the Gulf spill has not explained very well why supertankers are not being deployed to vacuum up oil, as was the case in the Persian Gulf some years ago. Vacuuming in the Persian Gulf was easier because the oil floated to the surface and was not broken up with dispersants.
After you suck this sort of oil into a supertanker, you wait for the oil and water to separate. Then, if there are no regulations against it, you siphon off the water and pump it back into the ocean.
Despite BP’s denials to the contrary, much if not most of the oil spilled in the Gulf is in huge plumes of droplets of oil in colloidal suspension. There are many of these plumes, which are up to 3,000 feet deep and miles long.
Normally, the heavy ends of the oil (used to make asphalt) settle on the ocean bottom. The thick, gooey oil, ranging in consistency from tar to mousse, floats on the surface.
Even if most of the Gulf could be vacuumed up into supertankers to get the droplets of oil, what would end up in the supertankers would be a tiny amount of dispersant and oil, mixed with a huge amount of water. Regulations prohibit dumping the siphoned water back into the ocean, so the responsible party (BP) would have to figure out what to do with much of the Gulf of Mexico sitting as oily water waste in supertankers. It’s doubtful that there’s enough tank capacity onshore to handle all this oily water until it is disposed of properly.
The spill may be reduced in size by various temporary measures, but stopping the oil will likely not happen until August, when two new relief drillings to intercept the blown-out well are completed. When that happens, the well will be cemented and capped.
But expect cleanup of the environment to go on for decades.
Under the Clean Water Act, the EPA and Department of Justice can fine BP up to $4,300 per barrel spilled if willful negligence is proved. Proving negligence should not be difficult.
BP is already on probation in the U.S. after pleading guilty to a misdemeanor criminal charge resulting from oil spills on Alaska’s North Slope.
The experience of the federal government in suing Exxon over the Exxon Valdez accident offers some clues about where future government lawsuits against BP are likely to head.
Less than a year after the Exxon Valdez oil spill of about 262,000 barrels (though the spill may have been larger), a federal grand jury indicted Exxon and its shipping subsidiary on five criminal violations. Exxon, facing $600 million in fines, pleaded not guilty.
In a plea bargain with the Justice Department, Exxon agreed to pay $100 million in fines and restitution. But the federal judge in the case rejected the deal. The parties settled for $125 million.
Later, in 1994, a grand jury in a civil action levied punitive damages of $5 billion against Exxon, but that was reduced by the U.S. Supreme Court to $507.5 million under a maritime law ruling. Maritime law may also apply in the BP case.
In all, Exxon, at risk for $6 billion, ended up paying just over $1 billion in these criminal and civil settlements. Settlements in most such cases are negotiated, delayed and appealed over a long time. By the time many suits are settled, the claimants are dead.
Companies like BP normally turn to contractors to handle the claims process for those seeking immediate damages, such as fishermen who have lost their livelihoods. The contractor employees, who may be overseen by a BP representative, are familiar with techniques for minimizing claims paid. Claimants are often desperate, and settle for cents on the dollar to get paid.
It remains to be seen how BP will exert its political muscle to minimize its losses.
BP has hired 27 more lobbyists, mostly former elected and appointed federal officials, to work its case on Capitol Hill.
The oil and gas industry spent more on federal lobbying last year than all but two other industries, with $174.8 million in lobbying expenditures, according to the Center for Responsive Politics.
Political action committees set up by the oil and gas producers contributed an additional $9 million in the last election cycle to congressional candidates, with Koch Industries (owner of Atlanta-based Georgia Pacific), ExxonMobil, Valero Energy and Chevron leading the way. BP ranked 19th, with $75,500 in contributions, mostly to Republicans.
BP has also rolled out a $50 million PR campaign featuring a TV spot starring CEO Tony Hayward, whose impolitic comments while the news cameras were rolling, such as “I’d like to get my life back,” have proven to be less than popular.
In paid TV ads, what the CEO says can be controlled.
Noel L. Griese is the editor of Energy Pipeline News, published daily by Anvil Publishers of Atlanta and the author of 17 books on the energy industry and other subjects.
Noel L. Griese
Wednesday, June 16, 2010
Just before the Deepwater Horizon accident, Florida spent $200,000 on a study of offshore drilling safety that concludes: “Oil spills from offshore exploration, development, production and the transportation associated with these activities are unlikely to present a major risk to Florida.”
So much for studies.
As the editor of Energy Pipeline News, I have followed the tragedy in the Gulf of Mexico with an insider’s knowledge of offshore drilling and an idea of what we can expect in the months and years ahead. Unfortunately, my background leads me to conclude that the cleanup will take years to accomplish, and compensating the victims and punishing those responsible will also take time.
Although the Deepwater Horizon may have been the first rig most Americans ever heard of, the Gulf is populated by a tangled network of 3,500 oil-drilling platforms and more than 43,000 miles of pipelines between Texas and Alabama.
The U.S. Gulf had accidents before the Deepwater Horizon burned and sank. Because of hurricanes Katrina and Rita, more than 8 million gallons of oil were spilled from coastal oil facilities and some 3.3 million gallons were spilled from a tank barge when it struck a sunken oil platform. More than 600,000 gallons were spilled from U.S. offshore oil platforms and pipelines.
Testimony before congressional committees reveals that shortcuts to safety were taken on the Deepwater Horizon to save money. The rig, which was costing BP $1 million a day, was 21 days behind schedule. So corners were cut. There’s plenty of blame to go around — for responsible party BP, rig owner Transocean, cementing contractor Halliburton, federal regulators and responders.
Based on an admittedly low-ball U.S. government estimate released in late May, the BP well blowout spilled about 500,000-800,000 barrels of oil into the Gulf through May. That compares with about 3.5 million barrels spilled off shore of Mexico over nine months in 1979 by the Pemex-operated Ixtoc I well that blew out on June 3, 1979, in the second-largest accidental spill in world history. But new estimates from a government technical committee on the amount of oil released through June 3 put the BP blowout already very close to surpassing the Ixtoc I record.
Despite vast U.S. waters, only 62 federal inspectors oversee offshore drilling in the Gulf and U.S. waters along the East and West coasts. Perhaps because its regulatory arm is understaffed, the Minerals Management Service quickly granted permission for BP to take the risks that resulted in the accident.
MMS also collects about $13 billion in annual royalties from the oil industry. This dual role of collecting revenues and enforcing safety put the agency in a conflict of interest with itself. Secretary of the Interior Ken Salazar is in the process of splitting the various MMS functions into three separate offices in an effort to minimize future conflicts of interest.
Despite our experience with the Exxon Valdez disaster in 1989, the response to the Deepwater Horizon spill was initially disorganized and inept. Even today, almost two months after the blowout, only a relatively few skimmers are in the Gulf cleaning up oil floating on the surface. Deployment of ocean booms to protect shorelines has been basically ineffective.
The Unified Command responding to the Gulf spill has not explained very well why supertankers are not being deployed to vacuum up oil, as was the case in the Persian Gulf some years ago. Vacuuming in the Persian Gulf was easier because the oil floated to the surface and was not broken up with dispersants.
After you suck this sort of oil into a supertanker, you wait for the oil and water to separate. Then, if there are no regulations against it, you siphon off the water and pump it back into the ocean.
Despite BP’s denials to the contrary, much if not most of the oil spilled in the Gulf is in huge plumes of droplets of oil in colloidal suspension. There are many of these plumes, which are up to 3,000 feet deep and miles long.
Normally, the heavy ends of the oil (used to make asphalt) settle on the ocean bottom. The thick, gooey oil, ranging in consistency from tar to mousse, floats on the surface.
Even if most of the Gulf could be vacuumed up into supertankers to get the droplets of oil, what would end up in the supertankers would be a tiny amount of dispersant and oil, mixed with a huge amount of water. Regulations prohibit dumping the siphoned water back into the ocean, so the responsible party (BP) would have to figure out what to do with much of the Gulf of Mexico sitting as oily water waste in supertankers. It’s doubtful that there’s enough tank capacity onshore to handle all this oily water until it is disposed of properly.
The spill may be reduced in size by various temporary measures, but stopping the oil will likely not happen until August, when two new relief drillings to intercept the blown-out well are completed. When that happens, the well will be cemented and capped.
But expect cleanup of the environment to go on for decades.
Under the Clean Water Act, the EPA and Department of Justice can fine BP up to $4,300 per barrel spilled if willful negligence is proved. Proving negligence should not be difficult.
BP is already on probation in the U.S. after pleading guilty to a misdemeanor criminal charge resulting from oil spills on Alaska’s North Slope.
The experience of the federal government in suing Exxon over the Exxon Valdez accident offers some clues about where future government lawsuits against BP are likely to head.
Less than a year after the Exxon Valdez oil spill of about 262,000 barrels (though the spill may have been larger), a federal grand jury indicted Exxon and its shipping subsidiary on five criminal violations. Exxon, facing $600 million in fines, pleaded not guilty.
In a plea bargain with the Justice Department, Exxon agreed to pay $100 million in fines and restitution. But the federal judge in the case rejected the deal. The parties settled for $125 million.
Later, in 1994, a grand jury in a civil action levied punitive damages of $5 billion against Exxon, but that was reduced by the U.S. Supreme Court to $507.5 million under a maritime law ruling. Maritime law may also apply in the BP case.
In all, Exxon, at risk for $6 billion, ended up paying just over $1 billion in these criminal and civil settlements. Settlements in most such cases are negotiated, delayed and appealed over a long time. By the time many suits are settled, the claimants are dead.
Companies like BP normally turn to contractors to handle the claims process for those seeking immediate damages, such as fishermen who have lost their livelihoods. The contractor employees, who may be overseen by a BP representative, are familiar with techniques for minimizing claims paid. Claimants are often desperate, and settle for cents on the dollar to get paid.
It remains to be seen how BP will exert its political muscle to minimize its losses.
BP has hired 27 more lobbyists, mostly former elected and appointed federal officials, to work its case on Capitol Hill.
The oil and gas industry spent more on federal lobbying last year than all but two other industries, with $174.8 million in lobbying expenditures, according to the Center for Responsive Politics.
Political action committees set up by the oil and gas producers contributed an additional $9 million in the last election cycle to congressional candidates, with Koch Industries (owner of Atlanta-based Georgia Pacific), ExxonMobil, Valero Energy and Chevron leading the way. BP ranked 19th, with $75,500 in contributions, mostly to Republicans.
BP has also rolled out a $50 million PR campaign featuring a TV spot starring CEO Tony Hayward, whose impolitic comments while the news cameras were rolling, such as “I’d like to get my life back,” have proven to be less than popular.
In paid TV ads, what the CEO says can be controlled.
Noel L. Griese is the editor of Energy Pipeline News, published daily by Anvil Publishers of Atlanta and the author of 17 books on the energy industry and other subjects.
Friday, May 28, 2010
Lab proposes an increase of 10 sen every six months until 2014
The Star Online, Friday 28,2010
KUALA LUMPUR: Fuel prices could increase as soon as next month if a proposal by the Subsidy Rationalisation Lab is to be implemented.
The lab, organised by Performance Management and Delivery Unit, recommended that fuel price be increased by 10 sen to 15 sen by the middle of the year to help realise the Government’s plan to cut its subsidy bill.
Following the initial increase, the lab proposed an increase of 10 sen every six months until 2014, by which time the level is expected to have reached market price.
To help mitigate the effects of the price hike, owners of cars with an engine capacity below 1,000cc will get a cash rebate of RM126 per year.
Owners of motorcycles below 250cc will get a rebate of RM54 a year.
Using this formula, the Government will save RM44.9bil in five years.
According to a simulation conducted by the lab, the impact of the price hike would be minimal.
It found that the diesel price hike of 15% or 21 sen would result in express bus fares increasing by one sen to 1.5 sen a kilometre.
The same quantum of increase would raise stage bus fares by 1.4 sen to 50 sen a kilometre, and school bus fares by one sen to 58 sen a kilometre.
For cooking gas or liquefied petroleum gas, the lab proposed a 10% increase by the middle of the year, followed by a 20% increase every year.
The lab projected that an increase of 15% in the price of gas would raise prices of food such as roti canai, nasi lemak, teh tarik and mee goreng by only one to four sen.
On healthcare, the lab proposed that the charge for outpatient treatment at public clinics and hospitals be increased from RM1 to RM3.
For in-patient treatment, the cost will be doubled to RM160 for Class One wards, RM40 (Class Two) and RM6 (Class Three).
Those whose household income is under RM2,160 or categorised under the Fees Act will still enjoy fee exemption.
It also proposed that from 2013, patients pay a percentage of their in-patient cost instead of the current flat rate, and from 2015, patients are to pay a percentage of their outpatient treatment and medication.
KUALA LUMPUR: Fuel prices could increase as soon as next month if a proposal by the Subsidy Rationalisation Lab is to be implemented.
The lab, organised by Performance Management and Delivery Unit, recommended that fuel price be increased by 10 sen to 15 sen by the middle of the year to help realise the Government’s plan to cut its subsidy bill.
Following the initial increase, the lab proposed an increase of 10 sen every six months until 2014, by which time the level is expected to have reached market price.
To help mitigate the effects of the price hike, owners of cars with an engine capacity below 1,000cc will get a cash rebate of RM126 per year.
Owners of motorcycles below 250cc will get a rebate of RM54 a year.
Using this formula, the Government will save RM44.9bil in five years.
According to a simulation conducted by the lab, the impact of the price hike would be minimal.
It found that the diesel price hike of 15% or 21 sen would result in express bus fares increasing by one sen to 1.5 sen a kilometre.
The same quantum of increase would raise stage bus fares by 1.4 sen to 50 sen a kilometre, and school bus fares by one sen to 58 sen a kilometre.
For cooking gas or liquefied petroleum gas, the lab proposed a 10% increase by the middle of the year, followed by a 20% increase every year.
The lab projected that an increase of 15% in the price of gas would raise prices of food such as roti canai, nasi lemak, teh tarik and mee goreng by only one to four sen.
On healthcare, the lab proposed that the charge for outpatient treatment at public clinics and hospitals be increased from RM1 to RM3.
For in-patient treatment, the cost will be doubled to RM160 for Class One wards, RM40 (Class Two) and RM6 (Class Three).
Those whose household income is under RM2,160 or categorised under the Fees Act will still enjoy fee exemption.
It also proposed that from 2013, patients pay a percentage of their in-patient cost instead of the current flat rate, and from 2015, patients are to pay a percentage of their outpatient treatment and medication.
Malaysia petrol prices could rise initial 15sen/ltr
Wed May 26, 2010 9:04pm EDT
KUALA LUMPUR, May 27 (Reuters) - Malaysia's government could hike petrol prices by an initial 15 sen (Malaysian cents) per litre from their current price at some stage this year under plans presented by a body advising the government on how to cut subsidies.
The benchmark RON 95 grade currently costs 1.80 ringgit ($0.543) per litre.
The proposals were made in a public presentation on Thursday to win over voters to accepting higher prices as Malaysia seeks to reduce its budget deficit which stood at a 20-year high of 7 percent of gross domestic product in 2009.
Under the proposals presented by the advisory body, the price of petrol would be hiked some time this year followed by two price hikes totalling 20 sen per litre in 2011 and two more of 20 sen per litre in 2012.
In 2013-2015, the price hikes would slow and by the end of 2015, the price of RON95 would stand at 2.60 ringgit per litre, according to the plans that have yet to be approved by the government.
The forecasts were based on a crude oil price forecast of $73.06 per barrel for 2011 and $79.41-$94.52 for 2013-2015.
KUALA LUMPUR, May 27 (Reuters) - Malaysia's government could hike petrol prices by an initial 15 sen (Malaysian cents) per litre from their current price at some stage this year under plans presented by a body advising the government on how to cut subsidies.
The benchmark RON 95 grade currently costs 1.80 ringgit ($0.543) per litre.
The proposals were made in a public presentation on Thursday to win over voters to accepting higher prices as Malaysia seeks to reduce its budget deficit which stood at a 20-year high of 7 percent of gross domestic product in 2009.
Under the proposals presented by the advisory body, the price of petrol would be hiked some time this year followed by two price hikes totalling 20 sen per litre in 2011 and two more of 20 sen per litre in 2012.
In 2013-2015, the price hikes would slow and by the end of 2015, the price of RON95 would stand at 2.60 ringgit per litre, according to the plans that have yet to be approved by the government.
The forecasts were based on a crude oil price forecast of $73.06 per barrel for 2011 and $79.41-$94.52 for 2013-2015.
Monday, April 26, 2010
Congestion pricing could be extended to Penang
Sunday April 25, 2010 - The Star Online
THE LPT Bill, if enacted, will not be restricted to Kuala Lumpur. It also provides the authority to implement ACP in any city in the country so there is a probability it could even be introduced in Penang.
However, Penang-based Citizens for Public Transport (Cepat) is against the idea.
Says Cepat co-ordinator and member of the Penang State Transport Council Dr Choong Sim Poey: “It may mean setting up a complicated system of gates to monitor movement of cars in and out of these zones.”
He says it could be expensive to implement and would not be successful if it was.
“We can’t even prevent illegal parking in front of police stations, for example in Penang Road or Burmah Road, so how can we monitor illegal entry?” he questions.
He believes congested areas can be cleared – simply by moving illegally-parked vehicles off the road. He also suggests reducing on-street parking, and raising the parking fees and a strong public transport improvement campaign as alternative measures.
“No extra equipment or infrastructure is needed, just political will. Cepat proposed this years ago, and we are waiting to see what progress the state Government can achieve,” says Dr Choong.
Similarly, social activist and blogger Anil Netto is against ACP.
“Much can be done to improve the public transport system, and we need to work on that first. Having congestion pricing without substantial improvements in public transport would be terrible,” he says.
A novel solution to improve public transport in Penang is to re-introduce the use of trams, and Netto has got a group of bloggers together to endorse the idea.
Trams are not new to the city; there was a tram system running in Penang until 1936.
He believes trams have many benefits and in the context of Penang will blend in with its heritage environment.
“It can be an added attraction for Penang, and it would be the first in the South-East Asian region. It’s also a great way to see the city and could encourage more visitors – locals, out-of-town Malaysians and foreign tourists – to the city. It will stimulate local economic activity,” he says.
Trams aside, Netto opines that Penang’s public transport system – on the whole – should be improved.
“It is not an either-or situation. Buses, trams, ferries – along with cycling and walking – should be part of an integrated transport system that complements one another, making Penang more accessible to all,” says Netto.
THE LPT Bill, if enacted, will not be restricted to Kuala Lumpur. It also provides the authority to implement ACP in any city in the country so there is a probability it could even be introduced in Penang.
However, Penang-based Citizens for Public Transport (Cepat) is against the idea.
Says Cepat co-ordinator and member of the Penang State Transport Council Dr Choong Sim Poey: “It may mean setting up a complicated system of gates to monitor movement of cars in and out of these zones.”
He says it could be expensive to implement and would not be successful if it was.
“We can’t even prevent illegal parking in front of police stations, for example in Penang Road or Burmah Road, so how can we monitor illegal entry?” he questions.
He believes congested areas can be cleared – simply by moving illegally-parked vehicles off the road. He also suggests reducing on-street parking, and raising the parking fees and a strong public transport improvement campaign as alternative measures.
“No extra equipment or infrastructure is needed, just political will. Cepat proposed this years ago, and we are waiting to see what progress the state Government can achieve,” says Dr Choong.
Similarly, social activist and blogger Anil Netto is against ACP.
“Much can be done to improve the public transport system, and we need to work on that first. Having congestion pricing without substantial improvements in public transport would be terrible,” he says.
A novel solution to improve public transport in Penang is to re-introduce the use of trams, and Netto has got a group of bloggers together to endorse the idea.
Trams are not new to the city; there was a tram system running in Penang until 1936.
He believes trams have many benefits and in the context of Penang will blend in with its heritage environment.
“It can be an added attraction for Penang, and it would be the first in the South-East Asian region. It’s also a great way to see the city and could encourage more visitors – locals, out-of-town Malaysians and foreign tourists – to the city. It will stimulate local economic activity,” he says.
Trams aside, Netto opines that Penang’s public transport system – on the whole – should be improved.
“It is not an either-or situation. Buses, trams, ferries – along with cycling and walking – should be part of an integrated transport system that complements one another, making Penang more accessible to all,” says Netto.
Commuters unwilling to pay unless system improves
Sunday April 25, 2010
The Star Online
FOR those working in the KL city centre, Area Congestion Pricing (ACP) is not something they are looking forward to, but some accept that it can be an effective measure. While people understand the need for a congestion toll, most are unwilling to accept it at the moment.
“I agree that traffic problems need to be addressed but I do not think ACP will be a solution until public transportation improves,” says financial advisor C.W. Ting* who is willing to pay an ACP charge, provided it costs the same as his fare.
K Nasir* reservedly agrees to the idea, but believes a combination of measures is needed to control traffic.
“I will be more motivated to car pool, but there will be days when I will still drive,” he says.
However, Hwei Min* who commutes from Subang Jaya to KLCC is against the idea of ACP as she has no choice but to drive to work every day.
“There is no Light Rail Transit (LRT) in Subang Jaya and I would have to drive to Kelana Jaya, which takes me more than half an hour. Then I would have to wait for three or four trains before boarding.
“I would probably have wasted at least one and a half hours using the LRT as opposed to driving, which takes me about 45 minutes,” says Min, adding that public transport in KL is a nightmare.
Danny Lok, 36, a frequent commuter on the LRT, has had many bad experiences due to breakdowns.
“The worst part is there is no continuity plan. They should advise or provide alternative transport to their desired station. They don’t communicate information to commuters either.”
* Full/actual names withheld on request
The Star Online
FOR those working in the KL city centre, Area Congestion Pricing (ACP) is not something they are looking forward to, but some accept that it can be an effective measure. While people understand the need for a congestion toll, most are unwilling to accept it at the moment.
“I agree that traffic problems need to be addressed but I do not think ACP will be a solution until public transportation improves,” says financial advisor C.W. Ting* who is willing to pay an ACP charge, provided it costs the same as his fare.
K Nasir* reservedly agrees to the idea, but believes a combination of measures is needed to control traffic.
“I will be more motivated to car pool, but there will be days when I will still drive,” he says.
However, Hwei Min* who commutes from Subang Jaya to KLCC is against the idea of ACP as she has no choice but to drive to work every day.
“There is no Light Rail Transit (LRT) in Subang Jaya and I would have to drive to Kelana Jaya, which takes me more than half an hour. Then I would have to wait for three or four trains before boarding.
“I would probably have wasted at least one and a half hours using the LRT as opposed to driving, which takes me about 45 minutes,” says Min, adding that public transport in KL is a nightmare.
Danny Lok, 36, a frequent commuter on the LRT, has had many bad experiences due to breakdowns.
“The worst part is there is no continuity plan. They should advise or provide alternative transport to their desired station. They don’t communicate information to commuters either.”
* Full/actual names withheld on request
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