SHAH ALAM, May 31 - Malaysia isn’t ruling out the possibility of realigning national spending policies as fuel subsidy expenditure has risen to nearly RM5 billion a month amid the global energy crisis, said Economy Minister Akmal Nasrullah Mohd Nasir.
He said the situation is pressuring the country’s fiscal deficit targets for the year, and requires a reconsideration of the government’s spending structures.
He added that Putrajaya is reviewing fuel subsidy allocations and rationalising spending management to ensure fiscal deficits are within intended targets.
“The government is expediting the transition to targeted subsidy mechanisms which are more efficient. This is important to ensure public funds are used optimally and reduce the nation’s financial burdens due to soaring world crude oil prices,” he said, as reported by Sinar Harian.
Akmal Nasrullah added that spending priority would be given to high-impact projects involving basic facilities, critical infrastructure, healthcare, education, food security, flood mitigation, public transport, and the digitalisation of government services.
He also said the agriculture, manufacturing and services sector are among those set to be heavily impacted if the global energy crisis persists, as higher fertiliser and feed costs could affect food security and supply chain disruptions lead to hikes in logistics and insurance costs.
On the government’s long-term measures, he said Petronas has activated a petroleum source diversification strategy in regions including South America, West Africa and Central Asia.
Akmal Nasrullah also said the government monitors developments daily through the Global Supply Crisis Monitoring Dashboard to ensure interventions can be launched immediately and in a targeted manner to ensure Malaysia’s economic stability.