Taxi business needs more competition in Brunei

Reading Time: 2 minutes

Taxi BruneiAfter reading about a taxi driver pleading to have the government curb “illegal” taxi drivers in this local article, I am tempted to say that the solution is for the government to simply stay put. Doing otherwise will create unintended consequences that the country simply cannot afford.

Firstly, these “illegal” taxi drivers that Sari branded about are only there to reduce the usurious charge that his special interest group (the “legal” taxi drivers) impose.

At present, a licensed taxi driver can charge passengers $24 (!) for a short 15 minutes trip ride from the airport to the city while those unlicensed entrepreneurs would charge you $8.70.

This is an illustration of an open marketplace competition. Either the businessmen become better or they are out. No room for government intervention necessary. Reasons are as follows:

They will make the taxi drivers be more self-reliant. With fuel prices subsidised by the government in Brunei, it is it about 0.50 cent/liter cheaper in the country than in, say, Malaysia. This cost the government a whooping $340 million in 2008 alone.

This environment will create more competitors to help drive prices down and the service levels up. The reason why there is an increase in the levels of living standard are not so much attributed to complacency or having too much cash but on the existence of competition.

The Brunei government saves its finite resources by avoiding this anti-growth economic policy. The country simply cannot afford to award laziness in the era of global competition. To do so is to incur economic damage that goes at the very heart of innovation and economic growth. It will hurt business people.

Finally it will reduce costs for the consumers. Who will ultimately win if there is a lot of competition if not the customers themselves? The equally important question is: Who will bear the brunt if not them as well?

It is a win-win solution for all parties.

Should the government meddle in the industry, however, there would be unintended consequences. Namely, the fees are only going to be higher on the one hand, and reduce a businessman’s entrepreneurial streak on the other.

The former will a result acollusion,i.e price-fixing, using the government as an instrument to drive up prices. Blunting these people’s self-reliance will have the result that they ask for more handouts and free money.

So government officers who are reading this: Do not be like that well-intentioned parent who spoils a child trying to strike their own. It’s wrong. Instead, let them be.

If these people are really sincere in “sharing the happiness” to the tourists as they claim to be, the government can test them: Prize freezing. At $5.00 per trip for the whole city. Let’s see if these special interest groups are still open for such ideas.

P.S. It not right for an internationalising economy like ours to brand hardworking migrant (or local) entrepreneurs’ work as “illegal”. It’s peeving.

 

 

Do you like this post?
  • Fascinated
  • Happy
  • Sad
  • Angry
  • Bored
  • Afraid

Reading Time: 2 minutes

After reading about a taxi driver pleading to have the government curb “illegal” taxi drivers in this local article, I am tempted to say that the solution is for the government to simply stay put. Doing otherwise will create unintended consequences that the country simply cannot afford.

Reading Time: 2 minutes

Taxi BruneiAfter reading about a taxi driver pleading to have the government curb “illegal” taxi drivers in this local article, I am tempted to say that the solution is for the government to simply stay put. Doing otherwise will create unintended consequences that the country simply cannot afford.

Firstly, these “illegal” taxi drivers that Sari branded about are only there to reduce the usurious charge that his special interest group (the “legal” taxi drivers) impose.

At present, a licensed taxi driver can charge passengers $24 (!) for a short 15 minutes trip ride from the airport to the city while those unlicensed entrepreneurs would charge you $8.70.

This is an illustration of an open marketplace competition. Either the businessmen become better or they are out. No room for government intervention necessary. Reasons are as follows:

They will make the taxi drivers be more self-reliant. With fuel prices subsidised by the government in Brunei, it is it about 0.50 cent/liter cheaper in the country than in, say, Malaysia. This cost the government a whooping $340 million in 2008 alone.

This environment will create more competitors to help drive prices down and the service levels up. The reason why there is an increase in the levels of living standard are not so much attributed to complacency or having too much cash but on the existence of competition.

The Brunei government saves its finite resources by avoiding this anti-growth economic policy. The country simply cannot afford to award laziness in the era of global competition. To do so is to incur economic damage that goes at the very heart of innovation and economic growth. It will hurt business people.

Finally it will reduce costs for the consumers. Who will ultimately win if there is a lot of competition if not the customers themselves? The equally important question is: Who will bear the brunt if not them as well?

It is a win-win solution for all parties.

Should the government meddle in the industry, however, there would be unintended consequences. Namely, the fees are only going to be higher on the one hand, and reduce a businessman’s entrepreneurial streak on the other.

The former will a result acollusion,i.e price-fixing, using the government as an instrument to drive up prices. Blunting these people’s self-reliance will have the result that they ask for more handouts and free money.

So government officers who are reading this: Do not be like that well-intentioned parent who spoils a child trying to strike their own. It’s wrong. Instead, let them be.

If these people are really sincere in “sharing the happiness” to the tourists as they claim to be, the government can test them: Prize freezing. At $5.00 per trip for the whole city. Let’s see if these special interest groups are still open for such ideas.

P.S. It not right for an internationalising economy like ours to brand hardworking migrant (or local) entrepreneurs’ work as “illegal”. It’s peeving.

 

 

Do you like this post?
  • Fascinated
  • Happy
  • Sad
  • Angry
  • Bored
  • Afraid