ogbeche77:

Ghana has cut fuel subsidies following an increase in crude oil prices and the depreciation of the Ghana cedi currency, the Chief Executive Officer of Ghana's National Petroleum Authority, Alex Mould, said in a statement on Thursday.

Reuters reports that Ghana, which joined the club of oil producers in West Africa last year, has come under increased pressure from the International Monetary Fund to remove the fuel subsidies. The IMF has urged countries across West and Central Africa to cut fuel subsidies, which they say are not effective in directly aiding the poor, but do promote corruption and smuggling.

The past months have seen governments in Nigeria, Guinea, Cameroon and Chad moving to cut state subsidies on fuel. Mould said the cumulative effect of the rise in crude oil prices this year and the about 5.7 per cent depreciation of the cedi meant a 25 per cent increase in cedi terms in the cost of procuring crude oil and petroleum products since January. Mould said Ghana had spent about 450 million cedis (N 44,725,608,210.76) on fuel subsidies in 2011.


The price change effective from December 29, will see the cost of Liquefied Petroleum Gas increase by 30 per cent while petrol and diesel will go up 15 per cent at pump. Mould said the NPA would be monitoring crude oil prices and will not to increase or decrease pump prices if the average crude price stay within the $ 107-110 per barrel range. Brent crude rose 4 cents to $107.60 a barrel by 0933 GMT on Thursday after falling nearly $2 the day before, while the Ghana cedi was trading at 1.6370/95 to the US dollar.

Ghana's Minister for Finance Kwabena Duffour said the removal of subsidies would have a positive impact on Ghana's economy.

By this increase, according to the NPA, the price of petrol to GNp175.48 (N184.972) per litre; diesel is now GHp 177.09 per litre ((N186.668); while LPG will go up by 30 per cent at GHp 136.19 per kilo (N143.765). This means a 12.5 kg gas cylinder will now sell at GHc17.02 (N1,796.76) while a 14.5 kg cylinder will sell at GHc19.75 (N2,084.96). The prices of kerosene, premix fuel and Renewable Fuel Oil (RFO) remain unchanged. Read 617 times | Like this? Tweet it to your followers! Published in NEWS Tagged under Ghana cuts fuel subsidies fuel rises to N184 per

efisher:

And Nigerians are there dragging their feet. Swallow the bitter pill NOW lazy folks!

HNosegbe:

@ Koruji But the subsidies you refer to are given to domestic manufacturers and farmers, not importers.

efisher:

If we remain adamant, regional economics will have us in even worse positions than we are now with the removal of subsidy in Ghana and other neighboring countries.

Developed economies will not subsidize a commodity that cannot stimulate local growth or that doesn't have any future strategic impact on the economy. Even worse is a global commodity in a mature market. In other words, subsidies in these countries usually act as economic stimulants for long term gains.

russellino:

@topic - has ghana started producing oil yet. As far as i know he havent, they are still importing their fuel. Our case is different so we should be careful how we compare the two countries

efisher:

And Nigerians are there dragging their feet. Swallow the bitter pill NOW lazy folks!

efisher:

Myopic folks keep seeing things from one perspective only. My advice: Grow up.

efisher:

Myopic folks keep seeing things from one perspective only. My advice: Grow up.

the price of petrol to GNp175.48 (N184.972) per litre; (~ $5 a gallon)
diesel is now GHp 177.09 per litre ((N186.668);  (~ $5 a gallon)
while LPG will go up by 30 per cent at GHp 136.19 per kilo (N143.765).
This means a 12.5 kg gas cylinder will now sell at GHc17.02 (N1,796.76) while a 14.5 kg cylinder will sell at GHc19.75 (N2,084.96).

efisher:

@Mr. Gbawe, why do you then claim my perspective on this issue is tied to my preference in the 2011 elections. Why must it be so? Did I mention GEJ in my post? Do you think I'm that jobless to live my life around GEJ? Ever since April 2011, all you have ever done is live your life around an election that has long produced your present president. If you can't desist from labeling others with different political views from yours, there's no point discussing with you cos it leaves a bad after-taste. In fact, I'm done with you.

efisher:

@Mr. Gbawe, why do you then claim my perspective on this issue is tied to my preference in the 2011 elections. Why must it be so? Did I mention GEJ in my post? Do you think I'm that jobless to live my life around GEJ? Ever since April 2011, all you have ever done is live your life around an election that has long produced your present president. If you can't desist from labeling others with different political views from yours, there's no point discussing with you cos it leaves a bad after-taste. In fact, I'm done with you.

efisher:

True word Beaf. Ghana has realized itself and I hope we allow Nigeria realize herself too. Developed countries subsidize things like power generation from renewable energy in order to stimulate growth. As soon as a desired threshold is reached, subsidies are cut or removed. A classic example can be seen in the Spanish power sector which experienced tremendous growth in solar power generation partly due to government subsidy. As soon as the market began to experience excessive influx, subsidies were cut. At that point, the desired objective had been met.

It is extremely foolish to subsidize a commodity / technology that can easily be transferred to other countries. Imagine China subsidizing electronic production simply because it's in abundance.

To further explain my point on regional economics, Imagine for a moment we remain at N65 and all our neighbors
Move up to N185. This will mean increased smuggling across the borders with greater profit margin for the smugglers. It will not be difficult to get past customs with an ROI of over 130% in view. This time they will even kill to get the products across. That is if the customs officials do not have their own tankers.

For those who want to politicize the issue, Gov Oshiomhole is an ACN member and former labor leader, yet he openly supports the idea knowing the benefits. Fashola has also shown his support though he is less vocal about it. Our own world renowned economic gurus like Okonjo Iweala et al have also presented very sound arguments enough for every well meaning Nigerian to consider for the greater good. If we truly mean well, we will look beyond the man supposedly behind the policy and see it as it should be seen.

Beaf:

The bolded is pitiable. Nobody should be racked with so much hate.

@topic
I wonder when Nigerians will finally realise that they have been sold cheaply into slavery for N65.00 per litre petrol? I feel really pained when folk make passionate arguments to remain in economic chains, it really makes one wonder.
What sort of country subsidises consumption? All developed oil producers DO NOT subsidise fuel for consumption, its only the backward developed countries that do so; instead, they see subsidies as investments to be poured into productive areas like research, education, agriculture, health, manufacturing etc. But not Nigeria, cos everything we do is upside down.

Relax101:

People wey dey benefit from subsidy na dem dey whine for NL.
Dem go hala tire so tey dem go begin talk wetin no make sense.

How can less than 100 people in greedy Nigerians keep holding the country down by sharing 1trillion. haba!

koruji:

You better go to the developed economies, look at the innumerable number of subsidies they maintain, but more importantly how thorough the decision process is on any proposals to reduce or eliminate such subsidies.

ekt_bear:

Koruji, as a fraction of GDP, these Western countries spend a lot less on subsidies than Nigeria does.

GDP of the US is nearly 15 trillion, ~60 times that of Nigeria, and Nigeria spends 8 billion a year on fuel subsidies alone.

In fact fuel is heavily taxed in the US, not subsidized.

Relax101:

People wey dey benefit from subsidy na dem dey whine for NL.
Dem go hala tire so tey dem go begin talk wetin no make sense.

How can less than 100 greedy Nigerians keep holding down the country by sharing 1trillion. haba!

Beaf:

The bolded is pitiable. Nobody should be racked with so much hate.

@topic
I wonder when Nigerians will finally realise that they have been sold cheaply into slavery for N65.00 per litre petrol? I feel really pained when folk make passionate arguments to remain in economic chains, it really makes one wonder.
What sort of country subsidises consumption? All developed oil producers DO NOT subsidise fuel for consumption, its only the backward developed countries that do so; instead, they see subsidies as investments to be poured into productive areas like research, education, agriculture, health, manufacturing etc. But not Nigeria, cos everything we do is upside down.