KUALA LUMPUR: Asserting that only 15% of Malaysians are affected by the recent diesel price hikes does not mirror the broader economic reality, says Datuk Lawrence Low (pic).
The MCA vice-president said the impact of higher diesel prices extends far beyond direct diesel users, as diesel is a major cost component across multiple sectors of the economy.
“Rising diesel costs would eventually be passed through the supply chain and reflected in the prices of goods and services paid by consumers,” he said in a statement yesterday.
Low, who heads the party’s economic and SMEs affairs committee, pointed out that the key issue is not how many people purchase diesel directly, but how higher fuel costs affect transportation, construction materials and food prices.
Low’s remarks come following reports quoting Prime Minister Datuk Seri Anwar Ibrahim on Saturday as saying that, based on his observations, only 15% of users are affected by the fuel price increase due to the current global energy crisis.
Anwar noted that 85% of Malaysians are unaffected by market diesel prices because they still enjoy the government’s subsidised rates.
Low said prices increase due to higher diesel cost would make it difficult for any segment of the population to remain unaffected.
“Sectors such as logistics, construction and tourism are among the first to feel the impact of higher diesel prices,” he added.
He also said similar assurances had previously been made regarding electricity tariff hikes, but market prices eventually rose as businesses passed on higher costs.
He added that companies already facing higher expenses for fuel, wages and rent have limited ability to absorb further increases.
He urged the government to recognise the wider economic effects of diesel price adjustments and to introduce targeted measures to reduce the burden on businesses and consumers.
Among Low’s proposals are short-term relief measures for SMEs and the food and beverage sector.
They include a review of the diesel pricing mechanism to minimise supply chain disruption, greater transparency in fuel pricing, faster transmission of global oil price declines into domestic fuel prices, and temporary loan repayment deferments to ease business cash flow.
