Fuel Price and Economy

Went to a dinner function on Sunday night. The speaker said that the economy in Malaysia will be greatly affected next year due to globle recession. Instead of taking out billions of Ringgit for Value Cap to help the share market, he suggested that the Government should reduce the fuel price. By reducing the fuel price to actual market price of 90 sen per litre, every person in the country will benefit. It will boost the economy of Malaysia.

Come to think of it, what he said is true. Money put in Value Cap or bailout certain companies like what happened in the US only benefited a small group of people but by reducing the fuel price the money can spread to all the people in the country. Manufacturers and exporters will be able to reduce their cost and become more competitive. Price of goods can be reduced so that it can become more affordable. Cheaper traveling cost to attract more tourists. So many benefits that you can think off.