Written for The Diplomat
Malaysia’s decision to slash fuel subsidies has led to an increase in the price of petrol products, which in turn angered many consumers but was applauded by economists and credit rating agencies.
Prime Minister Najib Razak defended the government action by citing the need to balance the budget. He said the subsidies for petrol, diesel and liquefied petroleum gas had already reached 24 billion ringgit ($7.4 billion) in 2012. He argued that a substantial amount of these funds could have been used to finance education, health, and other needs of the vulnerable segments of the population.
Najib echoed the assertion of economists, who insist that general fuel subsidies provide more incentive to the rich than the poor. “Currently, our subsidy system benefits everyone, including the higher income group and foreigners. Thus, we need to move to a more targeted subsidy system that caters to vulnerable groups,” Najib said.
The International Monetary Fund has published a paper which dismissed the fuel subsidy as a funding program that “aggravates fiscal imbalances” while “depressing private investments and reinforcing inequality” by benefiting higher-income households instead of protecting the low-income consumers.
But some experts and opposition leaders have voiced concern over the sudden fuel price hike. They noted that this is the first time the government has reduced subsidies without consulting the public first. They fear that it will trigger inflation in other commodities, to the detriment of the poor.
Chong Zhemin, the economic development bureau chief of the Democratic Action Party in Perak, described the price hike as a “betrayal to the people’s trust” and a “huge burden” on them.
Star Sabah (State Reform Party) Chief Jeffrey Kitingan is puzzled why Malaysia is raising petrol prices when the international oil price has fallen to its lowest in nearly three years. “When other countries are reducing petrol prices, the petrol hike shows that the Prime Minister and his fiscal team must have run out of ideas how to address the economic problems and fails to consider the inflationary and drastic burdens that will be imposed on the ordinary rakyat (people) particularly the lower income groups.”
Yin Shao Loong of the Institut Rakyat accused the government of failing to provide options for citizens. “Before cutting fuel subsidies the government should have ensured that public transportation was adequate and Malaysian wages were healthy enough to withstand a jump in prices.”
Political analyst Khoo Kay Peng shared that sentiment when he wrote that “any unilateral action to simply reduce subsidies without looking at other interventions e.g. improving public transport systems is not going to work either.” He agreed that the government has to implement some drastic measures to optimize the use of public funds, but he disagreed about the timing of the subsidy reduction.
In response, Najib assured critics that the higher fuel price would not disrupt the local economy. He also pledged to provide cash transfers known as 1Malaysia People’s Aid (BR1M) to the affected segments of the population.
While economists lauded Malaysia’s decision, consumers, especially car owners, were displeased to learn about the higher petrol prices. However those opposing the subsidy withdrawal today are fewer than those who protested higher petrol prices last year. Perhaps Malaysian authorities should take this cue to quickly fulfill their promise to the public, by re-channeling the fuel subsidy to basic social services intended for the poor. Otherwise, the higher petrol prices could further alienate the government from struggling middle-class and working-class citizens.
Malaysian Lawyers March Against ‘Sedition Blitz’
Written for The Diplomat
More than a thousand Malaysian lawyers, dressed in black, conducted a “Walk for Peace and Freedom” Thursday morning to call for the repeal of the Sedition Act, a colonial era law passed in 1948. The historic march to the Parliament building was led by the Malaysian Bar Council, which rarely organizes political rallies.
The group is worried over the rising number of sedition cases filed by the government this year. In the first nine months of 2014, they recorded 12 cases of prosecution under the Sedition Act. Ten arrests were made in a span of 26 days since August 19. Those accused of making seditious remarks included lawyers, journalists, preachers, and even academics.
The Sedition Act contains broad provisions that could easily criminalize legitimate dissent. For example, it is a crime to cause “discontent or disaffection” and “feelings of ill will” among the inhabitants of Malaysia. Since its enactment in 1948, the act has regularly been used by authorities to suppress the political opposition. In recent years, a broad constituency has grown in opposition to the law, forcing Malaysian Prime Minister Najib Razak to make an election promise that his government would repeal the measure in 2012. But two years later, the law is still in effect and the ruling party continues to use it against government critics.
Malaysian Bar Council president Christopher Leong summarized the view of many legal scholars about the “archaic” law: “The Sedition Act 1948 has no place in our nation, which aspires to be a modern, moderate and progressive democratic society that seeks to respect the rule of law and to engender lasting harmony and unity. The continued existence and use of this legislation only serves to prolong an addiction to a reliance on its draconian provisions as a knee-jerk reaction to expressions of purportedly sensitive issues and dissenting views.”
Meanwhile, Susan Loone made history by becoming the first journalist to be charged under the law. She insisted that her only crime was to report the truth. “If writing the truth, asking questions, taking a minister to task or making a powerful figure accountable are seditious, then let us all be seditious!”
Lawyers were also joined by several journalists during the march. One of them was Alyaa Alhadjri: “The fact that I walked along as a journalist should be seen as a sign that something is indeed very, very wrong with the system because we would normally be reporting on such protests from the sidelines.”
The lawyers’ march has received worldwide attention and support from human rights groups, media networks, and law associations. The Law Council of Australia was one group to express solidarity with the protesting Malaysian lawyers: “The Law Council is deeply concerned by reports that the Sedition Act is being used in such a way that those who are viewed as critical of the Government are subject to investigation and prosecution under its powers.”
There are those who suspect that the sudden rise in sedition cases is related to the coming assembly of the ruling coalition. They think that Najib is hoping to appease the hardliners within his party who are against the decision to abolish the Sedition Act. The ruling Barisan Nasional has held power since the 1960s.
As an alternative to the Sedition Act, some government scholars are proposing the enactment of a National Harmony Bill, National Unity Bill, and National Unity and Integration Commission Bill. The government vowed to conduct further consultations about these proposals but human rights groups are concerned that some of these measures would merely revive the “draconian” provisions of the Sedition Act.
Bar council president Leong is proposing that this alternative law should create a space and dialogue where “nobody will be intimidated or threatened, (and) nobody would be put in fear for merely having a thought and expressing a thought.”
Malaysia’s recent election to the UN Security Council would probably embolden many to review the government’s domestic and foreign policies. The growing opposition to the Sedition Act is certainly one issue that the country will need to address in the international arena.