Manufacturing hurtles down a cliff Source: Statistics Department, Malaysia
There are three components to our Industrial Production Index — manufacturing, mining and electricity. Manufacturing (see dotted line), the most crucial, appears to be in free fall by December.
Manufacturing accounts for 71 per cent of the Index and contributes 28 per cent of GDP. It also employs 20 per cent of workers. And then there’s the ‘multiplier effect’ on the rest of the economy.
Oil price hike protest in Ipoh (Source: Unknown; forwarded via email)
So Petronas and the Malaysian government says subsidies distort the market. Of course, the withdrawal of subsidies will encourage conservation of a scarce resource – which is a good thing. It might even reduce pollution and congestion. Roads were noticeablly less congested in parts of Penang and KL today. Traffic on the Penang Bridge heading to the island at 5.20pm – peak time – was smooth; the usual bottleneck after the toll plazas, as the mutiple lanes narrow down to two lanes, was gone.
But has the government given much thought to the impact of the removal of oil subsidies on the poor – and even large segments of the middle-class, who are rapidly moving down to the ranks of the poor in terms of real purchasing power?
One key question has not been answered: why a sudden complete removal and not a gradual phasing out? Come on, tell us how much profit Petronas made for the year ended 31 March 2008. The figures should be available by now, even if the annual report isn’t ready. Continue reading »
For the last few days, I have been trying to figure out what exactly this oil “subsidy” is that the government is talking about, which it cannot tahan any longer and so it has to collect more money from the people.
What exactly is this “subsidy”? Everyone is talking about it without really knowing what this subsidy is all about.
Who is paying this “subsidy” to whom? I mean, actual cash payment. Is Petronas actually paying cash to anyone for this “subsidy”? Is the government paying cash to Petronas?
