Reduction in fuel prices

In line with his promise to reduce fuel prices, President Mills recently asked parliament to review the National Petroleum Authority (NPA) law with the view to reducing some of the tax components on petroleum products. This would lead to the automatic reduction of fuel prices in the country. In furtherance of this, Joy FM reported yesterday that fuel prices were to go down between 3-10%.

The radio station quoted sources at the NPA as saying that the reductions would ensure a drop in the litre price of petrol from 82 to GHp78 and diesel from about GHp89 to GHp85. A gallon of petrol will sell at GH¢3.51 from GH¢3.69, representing a drop of 5%, and diesel will sell at GH¢3.89 down from GH¢4.00, representing a 2.8% decrease.

Liquefied Petroleum Gas (LPG) is also expected to go down by about 10%. According to the Minister of Finance, Dr. Kwabena Duffuor, the reduction would lead to a $50 million revenue loss to the state. The Chronicle does not fault the government for the reduction because it was a campaign pledge that the then candidate Mills made to the good people of Ghana, to the effect that he would reduce fuel prices if Ghanaians gave him the mandate to steer the affairs of the country.

Though it is an electoral pledge that President Mills has fulfilled, for us at The Chronicle, we believe that the reduction is not necessary because it is not going to benefit the ordinary man on the street. Drivers have already indicated that they are not going to reduce their fares because the reduction made by the government or the NPA is negligible. Juxtaposing this with the huge $50 million revenue that the state is going to lose as a result of the reduction, it would not be wrong for one to conclude that the fuel reduction is a wrong decision.

Clearly, the government is going to put a whooping $50 million state money into private pockets without any benefits. As we write this piece, the Ghana News Agency has reported that fuel smuggling to Togo is on the increase, and now that we have further decreased the price of fuel, one can imagine what is going to happen. Though the decision had already been made, The Chronicle does not think it would be a wrong move if the government decides to reverse it in the interest of the national economy.

We also appeal to the opposition parties to stop muddying the situation by putting pressure on the government to reduce the fuel prices as promised. Though we concede that opposition parties have a duty to keep the government on its toes, this should however be done in the interest of the state. Any criticism, whether fair or not, that can bring our economy to its knees must not be pursued. Certainly, the NDC government has bitten more than they could chew, by promising to reduce fuel prices, despite the huge reduction that was done by the NPA a few days before the NPP exited from office, but as the saying goes let bygones be bygones, and think about how to move the country forward.