KUALA LUMPUR – The government’s decision to gradually apply targeted subsidies for fuel does not only help address social inequality, but it is a move in the right direction towards conserving the environment and preventing further damage, said Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad.
He said subsidy rationalisation policies are also bound to benefit in attracting investment prospects from environmentally-conscious nations.
“Subsidy reforms and retargeting efforts are not only more socially fair, but they’re also good for the environment. At the end of the day, we need a planet to begin with (before considering) securing investments,” he said as a guest on the Trick Lama podcast.
“While some people—not necessarily from within the cabinet—say that (targeted subsidies) might cause businesses to collapse, I keep making the argument that as long as we do it in a just and equitable manner to the best of our abilities…it’s crucial for the move to be truly impactful.
“The planet doesn’t need us. The danger is that we will be the meteor and dinosaurs wherein we cause our own extinction. The planet will go on in a different form, but we can’t go on without the planet,” he added.
The podcast was hosted by the Big Boom Media group editor-in-chief Terence Fernandez, group chief executive officer Datuk Zainul Arifin, and group executive director Datuk Ahirudin Attan. The full episode of the podcast session is expected to be released tomorrow (June 20).
Earlier this month, the government removed blanket subsidies for diesel, the latest initiative aimed at curbing leakages following its move to increase water and electricity tariffs. The subsidy rationalisation is also expected to be applied to highly popular RON95 petrol later this year.
In an explainer on its website, the International Monetary Fund posited that removing subsidies and using the revenue gain for better-targeted social spending and productive investments can promote sustainable and equitable outcomes.
The United Nations financial agency also said fossil fuel subsidy removal would reduce energy security concerns related to volatile fossil fuel supplies.
Highlighting Prime Minister Datuk Seri Anwar Ibrahim’s strong support for subsidy rationalisation, Nik Nazmi said that this has garnered backing from other cabinet members.
He said that financial prosperity in an increasingly green-conscious economic landscape depends on the government implementing effective measures to address environmental concerns.
“Being a trading country knowing that we need to be involved in the sector, we need to understand that the market is changing and we need to be able to meet (its demands).
“The days of us being a low-cost, low-value industrial export-driven economy are no longer there. We should be at the front (as) there is now an opportunity to be at the forefront of the green revolution.”
The minister also asserted that Malaysia’s vocalness in advocating for climate justice warrants assistance from more developed nations.
“We’re getting a bit more sophisticated and people appreciate us (as) we’re not climate change deniers. Malaysia has been quite ambitious with our targets, but we need assistance for capacity building.
“The developed world likes to focus on the least developed countries or the island states. As a high-middle income country, we have gotten some assistance, but it’s short of what was promised.”
Besides that, Nik Nazmi said the drafting process for the National Climate Change Bill is expected to be completed next year as the ministry is currently in the midst of negotiating certain matters with state governments.
Work on the bill, the minister said, first began last year and includes engagement sessions with an advisory panel mostly consisting of multinational corporations, government-linked corporations as well as small and medium enterprises.
The ministry has also held discussions with a consultative panel made up of civil society organisations, including those representing youth voices.
In February last year, Nik Nazmi, who then held the natural resources, environment and climate change portfolio prior to a cabinet reshuffle in December, said the government does not intend to rush the tabling of the bill.
Priority will instead be placed on ensuring that the bill, which aims to ensure that mitigation and adaptation actions can be carried out effectively at the state and local government levels, is comprehensive and truly impactful, he added. – June 19, 2024