Sean Douglas
FORMER energy minister Kevin Ramnarine on Monday told Newsday he welcomed the Government’s moves to remove the fuel subsidy, which he said had been a big strain on the economy and which had largely benefited the wealthy who drove big vehicles.
“It is a step in the right direction and will migrate TT towards being a low-carbon economy.”
However Ramnarine said the 1974 law that created the fuel subsidy had also created a fuel levy for companies to pay to help fund the subsidy.
“If the minister gets rid of the subsidy, he should also get rid of the levy.”
Ramnarine urged the Government to go further in how the fuel industry is run by removing the monopoly status of Paria Fuel Trading Company and allowing private companies to also import fuel for retail. “If we are liberalising the fuel sector, have multiple companies licensed to import fuel.”
Ramnarine supported the sell-off of NP’s gas stations. “It is a good idea for NP to exit the retail side of the supply chain. Let NP confine itself to being a wholesaler. Right now NP is both a retailer and wholesaler of fuel, but it will be more efficient if it focuses on its core business.”
He urged the sale of gas stations be an open and transparent process. Ramnarine said the sell-off will be “a major shake-up of the sub-sector and a most important development.”
“The rest of the world has long moved on. The Caribbean has all deregulated its fuel transport. This will also open opportunities for investment.”
Ramnarine did not think the removal of the fuel subsidy would cause a rise in the cost of gasoline at the pump in this time of low world oil prices, although he said this could change if oil ever reaches to US$60-70 per barrel. “If that were to happen the Government might want to cap the prices at the pump and to intervene with a subsidy.”
Ramnarine said this liberalisation will help TT move to a low-carbon status, saying the internal combustion engine is going the way of the horse and buggy.
