Friday 02 Jun 2023
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This article first appeared in The Edge Malaysia Weekly on December 12, 2022 - December 18, 2022

There is a whole host of goods that require approved permits (AP) to be imported into the country. Among those that require an AP are vehicles, heavy machinery, iron and steel products, chemicals, rice and many more.

In fact, it is surprising how many products require APs to be imported. For instance, many were surprised in May this year when the then prime minister Datuk Seri Ismail Sabri Yaakob abolished the AP requirement for the import of wheat, round cabbage, old coconuts, chicken and milk to control escalating prices.

The bigger plan was to dispense with APs for food imports effective immediately, to ensure an adequate supply of food in the country.

News reports had it that Malaysia has been importing over RM50 billion of basic foodstuff such as rice, beef, lamb and cabbage annually, and the former premier had ordered the Ministry of Agriculture and Food Industries to prepare short- and long-term plans to avoid a food crisis.

“Previously, there were APs to import beef and cattle but from today, these are no longer required and anyone can import whatever food items to ensure sufficient supply,” Ismail Sabri said.

In a nutshell, the AP system for imports is the largest rent-seeking tool in the country, and serves no purpose other than to enrich a handful of well-connected individuals, at the expense of consumers who end up paying more for goods. Put another way, the removal of APs would result in more money in the hands of the people.

The rationale for some of the APs has become irrelevant. For example, the justification for APs to bring in foreign cars was to protect the national car, but is this still necessary?

Proton is a joint venture between Chinese auto company Geely and DRB-Hicom Bhd, a company controlled by tycoon Tan Sri Syed Mokhtar Albukhary. Similarly, Perusahaan Otomobil Kedua Sdn Bhd, better known as Perodua, is a joint venture between UMW Holdings Bhd, MBM Resources Bhd and Daihatsu.

So is there really a need for the AP system?

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