Published October 15, 2008
M'sia to cut fuel prices again, boost economy
Najib rejects calls by Opposition to revise 2009 budget

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(KUALA LUMPUR) Malaysia's government said yesterday it will cut petrol prices again and is set to announce measures to boost the economy, although it will not change its 2009 budget and insisted economic growth was on track.

Cheaper fuel: Beginning today, Malaysia will cut down the price of petrol by 15 sen to RM2.30 per litre and of diesel by 20 sen to RM2.20 per litre
Malaysia has so far been little affected by the global credit crunch and the central bank has left interest rates unchanged for more than two years while other Asian countries have moved aggressively to fend off the risk of financial contagion.
Earlier in the day, the central bank said financial institutions here had 'negligible' exposure to problem assets and institutions, though it stood ready to act if necessary.
Finance Minister Najib Razak said although Malaysia had not been hit badly by the global financial crisis, he would implement measures to strengthen the economy, although he did not specify what measures were needed to be taken.
In a separate announcement, Prime Minister Abdullah Ahmad Badawi said the cost of fuel would be cut by 15 sen to RM2.30 (S$0.96) a litre and diesel prices will be cut by 20 sen to RM2.20 per litre from today. This will be the third cut since prices were hiked earlier this year.
World oil prices have fallen to US$83.71 per barrel from a peak of US$147.27 in July, and that, combined with lower subsidies, pushed inflation in Malaysia to 8.5 per cent in August, a near 27-year high.
Mr Najib rejected calls by the country's Opposition to revise the 2009 budget.
'The government will always monitor the situation, and several latest measures in the form of a stabilisation plan are being finalised, which I will announce next Monday,' he said.
'I want a complete announcement not piecemeal,' he said in Parliament, adding there was no need for a new deposit insurance scheme.
Malaysia's government has remained upbeat about the economic prospects for the commodity, oil and electronics exporter and sees growth at 5.7 per cent this year and 5.5 per cent in 2009.
Economists are warning 2009 could be worse than expected and leading Malaysian bank CIMB recently cut its growth forecast for next year to 3 per cent from 5 per cent. -- Reuters