Last week, authorities also ordered jail terms to prevent 10 mostly subsidised items including foodstuffs, cement and steel, being taken out of the country after a series of shortages shook the country ahead of expected polls.

'The new law will help the government take action against large companies, monopolies like cement and steel factories who collude to fix prices,' Domestic Trade and Consumer Minister Shafie Apdal told reporters.

'If there is a coalition or monopoly that does this, we can fine them up to a million ringgit,' he said.

Mr Shafie said the Malaysian cabinet had already approved the new law which is expected to be tabled in parliament in November.

He said the law will build on current legislation which provides for fines of up to 100,000 ringgit (S$56,710) and three years imprisonment.

Mr Shafie said there have been many cases of anti-competitive behaviour in the past, which has partly contributed to apparent shortages.

The government was also looking at implementing a new system to guarantee food security and stockpiles within the country, he added.

'We have discussed a system that will enable us to store more for a longer period of time and to grow more, not to be dependent on importation of these items,' he said.

Earlier this year, consumers were hit with severe shortages of sugar, flour and cooking oil causing supermarket shelves to be stripped bare as a result of panic-buying, triggering a huge public outcry.

The government was forced to flood the market with thousands of tonnes of cooking oil and flour to end the crisis.

Mr Shafie's comments come as Prime Minister Abdullah Ahmad Badawi is expected to announce general elections in March this year.

Analysts say the expected increases in oil and fuel prices as well as the recent food shortages will be key issues during the polls. -- AFP