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Malaysian Electricity Prices to Rise 16.85% 2014

Tenaga Nasional Bhd’s (TNB), Malaysia’s national utility company, has announced a January 1st electricity tariff increase.  Under the revised tariff, commercial and industrial users will see an average increase of 16.85%.

While the full impact of the double digit price hike on Malaysia’s manufacturers is unknown, the Malaysian Rubber Glove Manufacturers Association (MARGMA) states the electricity tariff review will increase production costs significantly for rubber glove manufacturers.  MARGMA predicts the production cost for 1,000 gloves will increase between US$0.20 and US$0.60 (RM0.63-RM1.90), depending on the type of equipment used.

The Federation of Malaysian Manufacturers (FMM) foresees further difficulties for industries already facing rising costs from the full implementation of the minimum wage and minimum retirement age.  The organization goes on to state “There is also the impending increase in gas pricing (US $0.07 per liter) and various other proposals in the pipeline such as unemployment insurance, environmental cess and increase in renewable energy fund contributions, all of which would again increase the cost of doing business significantly.”