Kuala Lumpur (VNA) – Malaysia has instructed ministries and agencies to cut operational spending as the country continues to face the impacts of tensions in the Middle East.
All ministries, departments, and government agencies have been asked to review their expenditures and propose budget cuts by May 15.
Speaking at a press conference on April 29, Minister of Communications Fahmi Fadzil said ministries had received notices from the Ministry of Finance (MOF) regarding adjustments to operational spending. The move aligns with the Malaysian Government’s efforts to streamline programmes and activities as it grapples with global economic challenges stemming from Middle East tensions.
Earlier in mid-April, the MOF revealed that fuel subsidies had been costing the national budget approximately 7 billion MYR (1.75 billion USD) per month, a tenfold increase from around 700 million MYR per month prior to disruptions in the Strait of Hormuz linked to US–Iran tensions. Of the 7 billion MYR, monthly subsidies for RON95 fuel surged sharply from 300 million MYR before the Middle East conflict to 4 billion MYR at present. Diesel subsidies, including support for farmers, fishermen, and logistics operations to stabilise essential food prices, also rose significantly from 400 million MYR per month to 3 billion MYR per month.
Fahmi said Malaysia is reviewing its RON95 and diesel subsidy programmes to better align them with current conditions. He noted that the Government is studying a more targeted subsidy mechanism, particularly for diesel subsidies in East Malaysia, where residents continue to benefit from subsidised diesel prices at 2.15 ringgit per litre. The mechanism is expected to be implemented by the MOF.
He affirmed that Malaysia’s fuel supply remains sufficient in the coming months, especially in May and June, with no immediate concerns, including for the national oil company Petronas. The Malaysian Government also has no plans to revise or re-table this year’s budget in Parliament, the minister added./.
Malaysia considers cutting road tax for diesel vehicles
Prime Minister Datuk Seri Anwar Ibrahim said he has asked the Transport Ministry to identify a suitable mechanism to implement the reduction, taking into account the impact of higher diesel prices on users, particularly sectors that still rely on diesel vehicles.
