BY BOO SU-LYN
DECEMBER 7, 2013
UPDATED: DECEMBER 07, 2013 07:24 PM
|Najib said that the recent increases in fuel and sugar prices, as well as |
the electricity tariff hike next month, had improved Malaysia’s outlook
by ratings agency Moody’s from stable to positive.
KUALA LUMPUR, Dec 7 — Painful temporary subsidy cuts are necessary to boost the economy and to help Malaysia eventually achieve developed status by 2020, Datuk Seri Najib Razak told Malaysians today, amid public uproar over Putrajaya’s latest measures to trim government spending.
In his speech at the Umno general assembly here, the party president and prime minister said that the recent increases in fuel and sugar prices, as well as the electricity tariff hike next month, had improved Malaysia’s outlook by ratings agency Moody’s from stable to positive.
“We have to take some short-term pains for long-term gains,” Najib said as he closed Umno’s 67th general assembly here.
“It is only a little. Not very painful. By 2020, we’ll be a developed nation,” he added.
The electricity tariff in the peninsula will increase by 14.9 per cent, or 4.99 sen, to 38.53 sen for every kilowatt per hour (kWh), and 16.9 per cent, or 5 sen per kWh, to 34.52 sen per kWh for Sabah and Labuan, effective January 1 next year.
In April 2015, the controversial Goods and Services Tax (GST), a broad-based consumption tax, will also be implemented to help reduce the country’s fiscal deficit.
“We must strengthen our economy, then we can give more assistance to the people,” said Najib.
He added that government subsidies are not sustainable in the long run.
Najib’s remarks came after Umno Youth chief Khairy Jamaluddin warned his party today of public anger against government wastage and corruption at a time of subsidy cuts and a rise in the cost of living.
Khairy had cited the mismanagement of public funds as highlighted in the latest Auditor-General’s Report as an example.