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Thursday, May 25, 2006

Malaysia Electricity rate should lower than Taiwan

Energy, Water and Communications Minister Datuk Seri Dr Lim Keng Yaik announced the Cabinet's decision yesterday that electricity tariff in the peninsula Malaysia will go up by 12% from June 1.

Oriental Daily has published a schedule comparing Malaysia electricity rate with other country. Malaysia appear to be among the lowest in Asia. Malaysia electricity tariff only higher than Indonesia and Taiwan.

While it is reasonable for Malaysia electricity tariff to be higher than Indonesia as our cost of living is higher than Indonesia. It is surprising to know that Malaysia electricity tariff rate will be higher than Taiwan after the tariff hike.

Taiwan can be consider a develop country in Asia like Singapore. A lot of Taiwan investor invest in Malaysia because of our cost of manufacturing lower than Taiwan before the China boom. Now, our cost of electricity has increased to more than Taiwan. Are we encourage Taiwan manufacturer here to move back to Taiwan if not shift to low cost China.

TNB management should learn from their Taiwan counterpart on how to operate at such a low cost. TNB Key performance indicator (KPI) should benchmark against their Taiwan counterpart.

If such a high cost country in Taiwan able to keep their electricity rate low. There is no reason that Malaysia, a petroleum production country unable to do that.

Recent IMD report show that Malaysia competitiveness is still behind Taiwan despite we have a lower cost of living. Malaysia competitiveness might be deteriorated if our electricity rate is higher than silicon valley of Asia and do not have company like Acer, BenQ, Taiwan Semiconductor Manufacturing Company(TSMC) etc.

Link to this page: Globle Voice Online

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