Importing cheap gasoline from Malaysia deems unworthy: trade ministry

The Vietnam government is working with Malaysia to import 300,000 liters of RON 95 gasoline to ease domestic shortage, the Vietnam Trade Office in the country said.

The supply, however, only accounted for around one percent of Vietnam’s daily demand.

In Malaysia, a liter of RON 95 gasoline is sold at RM2.05 ($0.47) – a third of that in Vietnam, which recorded yet another record high of VND31,570 ($1.36) Wednesday.

But it is highly likely that Vietnam will not enjoy such low prices from importing from Malaysia, a representative of Vietnam Domestic Markets Department under the Ministry of Industry and Trade said.

RON 95 gasoline in Malaysia is subsidized by the government at RM1.65 a liter, and not subjected to tax once sold to Malaysians, the person added.

The exporting price, however, is not subsidized and equal to that of the region.

Meanwhile, taxes and fees account for 30-32 percent of gasoline prices in Vietnam.

Without them, a liter of gasoline in Vietnam can be sold at VND20,000 – almost the same as unsubsidized Malaysia gasoline price.

Hoang Van Cuong, member of the National Assembly Economic Committee, supported importing gasoline from Malaysia to increase domestic supply and stabilize prices.

But he noted that it should follow Vietnam’s management mechanisms.

He also called on agencies to consider lowering more taxes to bring gasoline down, which in turn will ease off financial burden on citizens.

Last month, Vietnam’s inflation was up by 2.86 percent year-on-year, driven by a surge in the prices of gasoline, food and some other goods.

Global gasoline prices went up while the rising costs of raw materials and ingredients pushed up food prices, according to the General Statistics Office.

Cuong exhorted the necessity of increasing national reserves and encouraging gasoline businesses to import through future contracts to stabilize the market.