Malaysian govt to cut subsidies for fuel, sugar

KUALA LUMPUR, July 15 Thu Jul 15, 2010 8:14am EDT

KUALA LUMPUR, July 15 (Reuters) - Malaysia's government said on Thursday that it will hike fuel prices and sugar prices from Friday in a move that will save 750 million Malaysian ringgit ($234.6 million) a year.

The government, that had previously put off price hikes, said the cost of RON95 blend petrol would rise by 5 Malaysian cents to 1.85 ringgit a litre, diesel prices would rise by 5 cents a litre and sugar prices would rise by 25 cents a kilo.

Cooking gas prices will rise by 10 cents per a kilogramme while RON 97 petrol prices will adjust to market rates.

"The readjustment of fuel and sugar prices are minimal compared to the proposals submitted because the government wants to balance between maintaining the people's interests and the need to manage the country's (budget) deficit," Prime Minister Najib Razak said in a statement.

(Reporting by Niluksi Koswanage and Razak Ahmad; Editing by David Chance)

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