ZCZC
BCN-29
S.AFRICA-FUEL-PRICE
S. Africa’s skyrocketing fuel prices to devastate consumers and economy:
experts
JOHANNESBURG, Oct. 3, 2018 (BSS/Xinhua) – South Africa’s escalating fuel
price hikes are likely to have “catastrophic” impact on the shrinking
economy, increase the cost of conducting business and reduce consumers
disposable income, economists warned on Tuesday.
The Energy Department this week announced that petrol price will go up by
between 99 cents and R1.24 a litre from Wednesday. Motorists in some
provinces will pay R17.08 for a litre of unleaded 95 petrol.
This is the seventh petrol price increase since 2018. A weak rand and
rising international oil prices are some of the major contributing factors
behind the rising fuel costs in South Africa.
Efficient Group’s chief economist, Dawie Roodt told Xinhua on Tuesday that
the latest fuel price increase will leave average consumers with less
disposable income.
“This is part of bad news that have been hitting consumers in South
Africa, as we have seen a number of petrol price increases this year alone.
We have seen an economy that is contracting, an increase in poverty, an
increase in unemployment, so I am afraid, this is just the last in a series
of bad news happening in our economy,” he said.
Roodt said that the rising petrol price will have an impact on the
contracting economy.
“This is going to put pressure on inflation again and eventually the
Reserve Bank will be forced to hike interest rates and that will put more
pressure on the economic growth,” he said.
“There’s a lot that government can do including improving macro economic
policies, the way the state is run and do something about state owned
companies and by doing those things, the country will become an attractive
investment destination and the rand will appreciate and when that happens the
petrol price will come down,” Roodt added.
The Automobile Association (AA) spokesperson, Layton Beard said that
growing the economy under these conditions will not be conducive.
MORE/HR/1300
ZCZC
BCN-30
S.AFRICA-FUEL-PRICE 2 JOHANNESBURG
“These increases are catastrophic for South African road users. Excluding
months where fuel taxes were hiked, this will be the largest single fuel
price increase South Africa has ever experienced,” he said.
“The impact inflicted on the economy by such increases may put pressure on
President Ramaphosa’s recently-announced stimulus package. We estimate this
increase could extract a further R2.5 billion a month in transport costs from
an economy that is already on the ropes,” Beard added.
The costs of fuel also prompted civil organizations to take to the streets
to protest the rising prices in recent months.
Some concerned citizens have taken to social media platforms to voice
their frustrations.
“At the rate these fuel hikes are going, it won’t be long now before a
full tank is worth more than the car that’s carrying it. A full tank is going
to be as unsafe as walking out of the bank with a suitcase of R200 notes,”
Tweeted Mninawa Ntloko.
BSS/AFP/HR/1300