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22.04.2009 Editorial

CJA & petrol politics

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The Committee for Joint Action (CJA) yesterday called a press conference in Accra and condemned the government over the recent fuel price adjustments. “We are totally dissatisfied with the recent increase in fuel prices and believe that a continuation of that policy would not be in the interest of the masses,” Benard Mornah, a leading member of the pressure group said. He charged the government to find an alternative, but more creative way to address the issue of fuel price increases, stressing that “we cannot, as a nation continue to purchase crude oil at spot market prices.”

The CJA for the past years put pressure on the Kufuor government to reduce fuel prices. The argument has always been that the government had put so many taxes on the fuel commodity, which must be reviewed downwards. The CJA backed their demand with action by organizing series of demonstrations across the country to protest against the high prices of fuel products. The Kufuor government was forced to succumb to this demand by drastically reducing prices of the commodity during the later part of last year.

Then candidate Mills, who had always supported the cause of CJA was still not satisfied with the reduction and promised Ghanaians that if they voted for him he would further reduce the fuel price. After assuming the reigns of government, the Mills administration had no alternative than to rush to parliament for the removal of some of the taxes on petroleum products. Despite all these measures, CJA is still not satisfied and is calling for the price reduction of the commodity.

The Chronicle admits that in every democratic dispensation, constructive criticism is very important to help keep the government of the day on its toes, but that should always go in line with alternative suggestions. We are, therefore, glad that CJA is suggesting Hedging, as a means of ensuring lower retail prices, but the Hedging strategy is a risky gamble, which the former Finance Minister, the late Kwadwo Baah Wiredu, refused to accept. If the hedging is successful you will be credited for it, but if you lose, the law on causing financial loss to the state can be used against you. So it is not as easy as the CJA is proposing.

It is easy to criticize, but when it comes to implementation it is not all that rosy. As we write this piece, petrol prices in Ghana are the cheapest in the sub region, which has resulted in the smuggling of the commodity to neighbouring West African countries. One can, therefore, imagine what would happen when the CJA demand is met and the fuel prices are further reduced. CJA should note that Ghana is not living on an island, she is part and parcel of the global village, and therefore, it cannot take certain decisions that will be at variance with what pertains in the global economy.

Laws have been enacted to guide the pricing of petroleum products in the country, and until these laws are breached, it would be unfair to call for either upward or downward adjustment of the products which are already the cheapest in the sub region. When petrol price went down drastically on the international market, we used this very column to call for the reduction in tahe retail price, which former President Kufuor did, but the situation is not the same today.

The actions of the CJA should be a warning to politicians who use all subterfuge means to gain power, because like a ball thrown against the wall, it would bounce back to them.

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