Malaysia to decide road toll cuts by August-paper

KUALA LUMPUR, June 8 (Reuters) - Malaysia will decide on a reduction in toll rates in August after a government-appointed committee completes its review of all highway concessions, the Malay-language newspaper Berita Minggu reported on Sunday.

The move to consider a cut in toll rates comes after the government raised fuel prices by as much as 63 percent last week, fuelling discontent among Malaysians.

Berita Minggu quoted Works Minister Mohamad Zin Mohamed as saying the government has started discussions with toll road concessionaires to evaluate all toll rates, including the possibility of cutting them. "We cannot make a decision now because the special committee is still studying and discussion with the toll road concessionaires in this country," Zin said.

He added the study, which would take three months, will look into traffic volumes, agreement clauses and concession periods to evaluate how much more toll road operators have to fork out to pay back loans and operating costs.

Under toll concession agreements that critics say favour operators, the government has to reimburse operators if traffic volumes and revenues fall short of pre-agreed projections.

Malaysia has 22 toll road concessionaires. The country's biggest toll road operator is state-controlled PLUS Expressways (PLUE.KL), which operates the highway that runs through the entire length of the Malaysian peninsula.

Most of the highways were approved in the 1990s by the administration of then Prime Minister Mahathir Mohamad, which made privatisation and mega-projects one of its hallmarks. (Reporting by Niluksi Koswanage, Editing by Jacqueline Wong)