Fuel prices go up next week

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Parent Category: Our Country

Category: Business & Finance

Created on Friday, 08 June 2012 00:00

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Fuel prices go up next week

The prices of petroleum products will go up between 5-10% this month and by similar margins every month for the rest of the year.

This is stated in an internal Ministry of Finance document prepared after the agreement reached with the International Monetary Fund during their recent visit to the country.

The "Memorandum of Economic and Financial Policies" drafted by Ministry of Finance and Economic Planning blames the increases on the 15% depreciation of the cedi to the dollar and the five percentage hike in the price of crude oil since late December when fuel prices last went up.

Government puts the cost of subsidies between January and May 2012 at GHC228 million.

The MOFEP document reads, "With the cedi now stabilising, the government will implement a policy of gradual (monthly) price adjustments -- starting with 15% increase in June while ensuring that total fuel price subsidies will not exceed GHC500 million for the year."

Also, government is threatening to stop subsidising utility companies. It has agreed with the IMF that government "support to utility providers will not exceed GHC180 million for the year."

It adds, "Going forward, the government will promote a gradual return to cost-recovery pricing, starting with a tariff adjustment in June."

Source: The Newstatesmanonline