Africa-Press – Botswana. The Finance Ministry is expected to table temporary measures by month-end aimed at easing the pain of rising inflation, particularly around fuel, although price controls are not being considered.
Pump prices have risen eight times since January last year and together with escalating food prices, have pushed inflation to a 14-year high of 11.9%. At the last count earlier this month, pump prices for petrol were more than 80% higher than their levels in July last year, lifting the prices of other goods and services across the economy.
The press is informed that the Finance Ministry will soon table government’s plans to provide temporary relief to Batswana. The matter was reportedly discussed at the Botswana Democratic Party (BDP) caucus that met this week with broad support from the ruling party legislators.
“A statement will be delivered to Parliament next week or before month-end detailing the temporary measures government is proposing to help Batswana cope with rising fuel costs,” insiders told.
The planned interventions were first hinted at by acting Minerals and Energy minister, Thulagano Segokgo who told a recent media briefing that Cabinet ministers across the spectrum were looking at their portfolios and how to assist.
“There are considerations that Cabinet deliberated on and while I cannot speak to the detail, I can say relevant Cabinet ministers have been tasked with looking at interventions to cushion Batswana and businesses from these price increases,” he said.
“Ministers have been tasked and so you can expect in a fairly brief space of time to hear, perhaps the Minister of Finance, addressing on how these interventions will be done.”
For her part, Finance Minister, Peggy Serame recently acknowledged growing calls for the return of price controls on selected goods and services.
“There is a debate of late that says we must introduce price controls and I don’t know, but I can see where they are coming from,” she told a funders’ conference last week.
The country’s traditional free market economy fundamentals mean most prices are determined by supply and demand. However, government does have administered prices for certain key goods and services such as retail fuel, public transport and others.
While the press is informed that price controls are off the table, analysts have said government could act by either temporarily reducing or removing the various levies which make up the overall fuel price.
These include the fuel levy which was increased by P1.00 last April and the National Petroleum Fund (NPF) levy which is charged at the rate of 13.5 thebe per litre.
In addition, other relief measures could be rolled out for sectors such as agriculture ahead of the cropping season which is due in a few months.
Russia’s invasion of Ukraine on February 24 has been one of factors behind the galloping fuel prices and the consequent increases in inflation. Russian crude oil accounts for about five percent of the world’s demand while the country is also a major supplier of refined oils such as diesel and jet fuel. Sanctions on Moscow have disrupted supplies and caused price bidding wars for the available stocks, leading to rampaging prices in most countries, particularly Africa.
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