PPP/C gov’t did a lot of creative things to keep the fuel price stable

Dear Editor,

Since taking over the levers of power in Guyana the PNC-led APNU+AFC regime has displayed a remarkable lack of concern for people’s welfare. The most recent example of this is its attitude to the rise in the price for fuel in Guyana.

The regime has turned a Nelson’s eye and a deaf ear to the cries of the people. They have totally ignored the protests of minibus and taxi drivers throughout the land.

In the recent past the PPP/C administration had to deal with similar situation on many occasions. Its approach was totally different from this APNU regime.

It is well known that fuel is a very strategic commodity. It is an energy product. It is involved in all or almost all economic activity. Therefore, any price movement is bound to have an impact on people’s welfare.

The PPP/C government did a lot of creative things to keep the price stable.  When the price went up internationally the PPP/C administration adjusted the taxes downward. When it went very high we often removed some taxes completely.

On the other hand when the price of fuel fell then the taxes were reintroduced. In that way the price at the pump remained relatively stable.

Indeed, I can recall at one time the price of fuel fell drastically. In that situation we thought that people should benefit more from the price fall.  Even in those circumstances we reduced the taxes so our people could benefit. The consumers of electricity from GPL benefitted due to reduced electricity bills.

The PPP/C administration did more than that. It used the state-owned Guyoil to regulate the price. As Guyoil reduced its price at the pump, the private gas station owners had to follow suit to keep up with the competition.  Therefore, the consumer benefited.

If you contrast this with the actions of the PNC-led APNU regime you will see the great difference.

While the PPP/C used Guyoil to keep prices down, this APNU regime is doing the opposite.

The same could be said of GPL. When the PPP/C left office the international price for a barrel of oil was US$120. Just three months after prices fell dramatically. It went to as low as US$15 per barrel. It then crawled up gradually. It is now about U$70 per barrel.

Yet no one got any discount on their electricity bill or any relief at the gas pump.

A clear indication of the parasitic nature of the APNU+AFC regime.

The policy of the PPP/C made good economic sense as well. It kept transportation costs down for workers and, therefore, reduced the pressure on government and employers for an increase in wages. That kept the cost of living down.

The same applies to the transportation of food items. By managing the price of fuel we managed to keep inflation at a low rate.

Indeed, this strategy of the PPP/C government, along with others, helped to reduce inflation from three-digit figures that it was in the late 1980s and early 1990s to low single digit almost throughout the period that the PPP/C was in office.

It also helped in the processing and manufacturing sectors. These are areas where fuel prices impact greatly on cost of production. By keeping the price stable it allowed those involved in manufacturing to be able to plan and remain competitive with regional and international competition.

This APNU+AFC government has abandoned these very sensible policies. The big question is why?

In the first place they are very aggressive in collecting maximum revenues.  Taxes and licences are put on the donkey cart operators and on housewives’ kitchen gardens. People in micro business are not spared, they, too, are being hounded down. Taxes have become very oppressive and are killing small businesses and stifling initiatives. Established, reputable businesses are being pressured by GRA, forcing one hundred percent inspection on them. This is carrying up their costs which are passed on to the consumer.

The regime, by its policies, is taking out billions of dollars in taxes from areas like Region One. They are extracting much more than they are putting into the project, through taxation, particularly of fuel.

This is to service the huge bureaucracy that they have created. The elite are enjoying huge salaries and lucrative benefits. The administrative cost has gone up greatly. They are sucking those who produce or provide services dry to satisfy the Cadillac lifestyle that they have adopted. Frequent travels abroad with royal allowances is one of the means of enriching themselves.

Yours faithfully, 

Donald Ramotar

Former President

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