Subsidy Rationalisation A Bold Step For The Future - Najib

KUANTAN, July 16 (Bernama) -- Prime Minister Datuk Seri Najib Tun Razak said Friday the government's subsidy rationalisation programme announced Thursday is a bold move to put the country's economy on a strong footing.

He said the move was a forward-looking decision which would bring about impact to the country's economic growth and the people's well-being.

"As a responsible government, we should be brave in coming up with decisions which will put the country's economy on a strong footing in the future.

"If we are only thinking of short-term effects all the time, then we are not a responsible government, because such a government will bring the country to the path of uncertainties," he said when opening the National Cooperatives Day here Friday.

Najib said the subsidy rationalisation was based on the principles of minimising the burden to the people.

He said the people in the country were still paying a much lower price for petrol, diesel, liquefied natural gas (LPG) and sugar compared to those in the neighbouring countries.

"For instance, in Malaysia, sugar is sold at RM1.90 per kg, but in Thailand the commodity is sold at the equivalent of RM2.60 per kg, in Indonesia at RM3.68 per kg and in the Philippines at RM3.46 per kg," he said.

Najib also said that the subsidy had to be readjusted because it had not benefited the target group.

He said two-third of the fuel subsidy were enjoyed by the high-and-middle income group while only one-third were enjoyed by the needy.

"For the LPG, 70 per cent of users are those involved in business and only 30 per cent are household users," he said.

For the rationalisation of sugar subsidy, he said, it could help tackle diabetes which showed an alarming trend in the country, with 1.4 million sufferers.

At the event, Najib also launched the 2011-2020 National Cooperative Policy which will chart the development of the country's cooperative movement as the third engine of growth.

He said that to assist the cooperatives sector, the government had allocated an additional fund of RM100 million through the Malaysian Cooperatives Commission this year.

The commission had previously set aside RM387 million under its revolving fund, he said.

"I'm told that the commission had given out loans totalling RM668 million so far," he said.