Malaysia to set up separate border petrol pumps for foreigners
Posted: 22 June 2008 1956 hrs

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KUALA LUMPUR - Malaysia announced plans on Sunday to set up separate pumps at its border petrol stations to sell fuel to foreigners at market rates so that only locals can benefit from subsidised petrol.

The new pumps will target Singaporeans and Thais who make day trips across the border to fill their tanks with cheaper fuel here.

The announcement by deputy premier Najib Razak comes less than a month after the government raised pump prices by 41 percent in a deeply unpopular move aimed at reducing its subsidies bill, which would have reached 17 billion US dollars this year.

Malaysians now pay 2.70 ringgit (0.83 US dollars) per litre of petrol, still one of the cheapest rates in the region.

"There are two benefits in using this system -- in that foreigners will pay market rates for their petrol here and Malaysians will know what the real price of petrol is," Najib was reported as saying by state news agency Bernama.

Domestic trade and consumer affairs minister Shahrir Samad said about 500 petrol stations within 50 kilometres (31 miles) of the country's northern border with Thailand and southern border with Singapore would be affected.

He said petrol station attendants would ensure cars with foreign licence plates filled up at the new pumps, Bernama reported.

Despite the urgent need to lower Malaysia's subsidy bill, there have been several protests over the price hikes in a country where public transport is weak and many people are dependent on their cars.

The ruling coalition suffered its worst ever result in March 8 elections, losing five states and a third of parliamentary seats in a setback partly credited to anger over high prices of food and fuel. - AFP/vm