Malaysia’s Carbon Tax Ambitions Need to Overcome Fuel Subsidies

Malaysia needs to address its fuel subsidies before it introduces a carbon tax, as the nation holds discussions with the World Bank on how to implement a scheme to help curb emissions.

“We are subsidizing our carbon,” Nik Nazmi Nik Ahmad, Natural Resources and Environmental Sustainability Minister, said during an interview with Bloomberg TV’s Haslinda Amin and Avril Hong on Tuesday. Malaysia has been an export driven industrial economy “fueled by blanket subsidies,” he added.

Malaysia has set a net-zero goal by 2050, removing most subsidies on diesel this month and vowing to target gasoline next. The finance ministry ...