Instead of controlling prices KPDNHEP legalising profiteering—Chong


Statement by Chong Chieng Jen:

Instead of controlling prices to prevent profiteering, the Ministry of Domestic Trade and Consumer Affairs (KPDNHEP) is now legalising profiteering.

The Minister of KPDNHEP has today announced a new ceiling retail price for 3-ply facemasks, increasing it from the previous RM0.80 per piece to RM2.00 per piece (150% price increase). The ceiling retail prices of the single-ply and 2-ply facemasks remain at RM0.15 per piece and RM0.20 per piece.

The official reason given for the increase in the ceiling price is that the raw material costs have increased due to the global surge in demand for facemasks. Such reasoning cannot hold water. Otherwise, how can the manufacturers maintain the prices of single-ply and 2-ply facemasks for they are using similar material?

It is only natural that traders and manufacturers want to maximise their profits as much as possible, but sadly, the newly anointed Minister of KPDNHEP has just naively bought into their reasoning to the detriment of consumers at large.

When Pakatan Harapan was the government, the ceiling price of 3-ply facemasks was only RM0.80 per piece and its wholesale price was RM25 per box of 50 (which is only RM0.50 per piece). In February 2020, my Pusat Khidmat managed to get the 3-ply facemasks at the price of RM13.00 per box of 50. All these just go to show that, the profit margin for facemasks was very high.

The reason that “there is huge demand and therefore we need to increase price without which the traders won’t want to sell” simply cannot stand because otherwise, there is no need for any price control and anti-profiteering law. It is when demand is high that traders can charge higher prices, taking advantage of the spike in demand. If high demand were to the new Minister of KPDNHEP the basis for increasing the ceiling price, then the Ministry will never effectively impose ceiling prices to protect the consumers.

Then, the PH Government was even prepared to allocate fund to purchase 3-ply facemasks and distribute for free. It is not the case for the new Perikatan Nasional (PN) Government.

The PN Government’s decision to increase the 3-ply facemask prices by 150% is ridiculous and puts all consumers at the losing end. With such approach and attitude of the new Minister of KPDNHEP, all our past 20 months’ effort to try stabilise prices and keep inflation below 1% will be neutralised in no time and we can expect an escalation of inflation despite the low fuel price.