October 2, 2014 at 9:00 pm
Fuel hike causes more deaths on the road, and stagflation
Media statement by DAP National Political Education Director and MP for Kluang Liew Chin Tong on 2nd October 2014
Without improvement in our public transportation system, the latest fuel hike, announced on 1st October 2014, is an irresponsible move that will hurt the lower income group further.
On 22nd September 2013 when the fuel price was last increased, I said that “Research has shown that motorcycle fatalities shot up as a result of the March 2006 and June 2008 fuel hikes as the lower income group switched transport modes from cars to motorcycles. A new human disaster of more motorcycle fatalities is imminent, following the latest petrol price increase.”
According to World Health Organisation’s Road Safety Report 2013, which was released recently, Malaysia has the highest per capita road deaths in the world. (Road fatalities per 100,000 population: India – 18.9; Russia – 18.6; China – 20.5; Malaysia- 25).
Malaysia has the dubious record of having the highest road fatality risk, i.e. death per 100,000 population, in the world since 1996. Between 2000 and 2009, 4.5 million road accidents were reported with 58,582 deaths.
Motorcycle fatalities are 3 times higher than car fatalities, 6 times higher than pedestrian fatalities and nearly 50 times higher than bus passenger fatalities.
In other countries where public transport services are adequately and efficiently provided, petrol price increase will encourage private car drivers to switch to public transport. However, in the case of Malaysia, each fuel hike exercise means more deaths on the road.
The other worrying challenge is that of stagflation in the making due to ill-advised policy choices. The combined economic effect of the latest fuel hike and the implementation of GST on 1st April 2015 may be the concurrent occurrence of inflation and stagnation, or “stagflation”.
The Malaysian economy has been heavily depended on domestic demand as a growth driver over the past five years since the Global Financial Crisis which resulted in much lower external demands from advanced economies.
The Finance Ministry had conceded that there will be inflation in the first year of GST implementation and “subsidy rationalisation”. What is yet to be recognised is that apart from inflation, the economy may also grind to a standstill as the disposable income of ordinary Malaysians is reduced by GST and fuel prices, which in turn results in much slower domestic demand.
Stagflation is the worst nightmare for our economy. But no one seems to have an answer.
Liew Chin Tong
October 2, 2014 at 9:39 am
Petrol hike causes motorcyclists' deaths
Read the research by a group of UKM academics
While the world deals with demand uncertainty and oil supply interruption in the market from 2005 until 2008, petrol price at the pump in Malaysia increased by 65 percent over the period.
This prices change has two effects.
First, the direct impact on demand for petrol due to the increase in price; and second the subsequent impact on safety due to a change in demand for mobility and mix of transport modes. The expected reduction in mobility improves road safety by lowering exposure and accidents while the opposite effect is expected as road users switch to more risky mode (motorcycles) from a safer mode (cars). This switch is likely to be pronounced in a country like Malaysia because of the relatively unsatisfactory state of the public transport system.
Findings from research in developed countries generally show a negative relationship between petrol price hike and road accident because users tend to travel less and switch to safer mode (public transport) following petrol price hike. The fact that switching to a riskier mode (motorcycles) is very likely in Malaysia due to the lack of a decent public transport service, revisiting the issue on the impact of price hike to safety using Malaysian data may give rise to opposite finding. In this study, quarterly data covering the period from 2000-2010 was used.
The model was estimated using both multiple regression and Poisson model. Results of the estimations suggest that mode switching to motorcycles took place over the study period in response to rising gasoline prices. The study also deaths and injuries among motorcyclists increased over the same period.
This result implies that the risk of accidents increase as a result of fuel price hikes thus contradicting findings of previous research done in developed countries. From the policy perspective, decision on fuel price increase must consider its negative impact on traffic safety.
October 2, 2014 at 9:37 am
Perubahan Harga Petrol dan Risiko Keselamatan Jalan Raya
Petrol Price Changes and Risks to Road Safety
Nor Ghani Md Nor
Ahmad Mohd Zin
Abu Hassan Shaari Md Nor
Pusat Pengajian Ekonomi
Fakulti Ekonomi dan Perniagaan Universiti Kebangsaan Malaysia
Ketika dunia berhadapan dengan ketidaktentuan permintaan dan penawaran minyak di pasaran antara tahun 2005 hingga 2008, harga petrol di Malaysia telah mengalami peningkatan sebanyak 65 peratus dalam jangka masa tersebut.
Perubahan harga ini telah meninggalkan dua kesan, pertama ialah kesan langsung iaitu perubahan permintaan ke atas petrol; dan kedua ialah peningkatan risiko terhadap keselamatan jalan raya (merupakan kesan tak langsung). Peningkatan risiko keselamatan jalan raya timbul ekoran daripada peralihan mod pengangkutan milik persendirian iaitu daripada kereta kepada motosikal. Hal ini berlaku disebabkan oleh masalah sistem pengangkutan awam yang kurang atau tidak cekap di negara ini berbanding dengan negara maju.
Di negara maju, kajian lepas menunjukkan hubungan antara kenaikkan harga petrol dan risiko kemalangan jalan raya adalah berhubungan secara negatif.
Oleh itu hipotesis kepada kajian ini ialah, hubungan antara peningkatan risiko kemalangan jalan dengan peningkatan harga petrol di negara ini adalah berhubungan secara positif. Jangkamasa yang dikaji ialah antara tahun 2000 hingga tahun 2010. Kaedah kajian yang digunakan ialah kaedah regrasi berbilang dianggar menggunakan permodelan poisson.
Hasil keputusan kajian mendapati yang kenaikan harga petrol telah meningkatkan jangkaan kematian dan kecederaan motosikal dari tahun 2006 hingga tahun 2010.
Keputusan ini memberikan implikasi berikut; berlaku peningkatan risiko kemalangan yang menyebabkan berlaku pertambahan jumlah kematian dan kecederaan motosikal semasa kenaikan harga minyak.
Penemuan kajian ini dapat membuktikan hipothesis positif antara kenaikan harga minyak dengan risiko keselamatan motosikal.
Justeru itu, dari segi dasar awam, keputusan untuk meningkat harga petrol seharusnya mengambil kesan negatif terhadap keselamatan pengguna jalanraya.
Kata Kunci : Perubahan Harga, Risiko Kemalangan Jalan Raya, Pengangkutan Awam.
October 2, 2014 at 9:34 am
Liew Chin Tong commented on his own link.