Ghana Reinstates Fuel Subsidy

Ghana’s Trade Union Congress (TUC) and government representatives have agreed to a 20 per cent reduction in petroleum prices effectively marking a reversal of governmental policy on fuel subsidy removal.

Prices of petrol and various other commodities had climbed by 20-30 percent following Ghana government’s decision to remove fuel subsidies last December.

The price reduction decision may effectively result in the full reinstatement of fuel subsidies, but no reduction in public transport fares as commercial transport operators maintain prices for spare parts have risen.

Most families in this growing economy do not own a car, but have to pay fares demanded by public transport operators.

Chairman of the Road Coordination Council, Mathew Hayford told the Ghana News Agency that petrol prices were only one factor in fixing public transport prices for the public.

“We are yet to meet over the matter, but it is unlikely we will see any downward review of transport fares,” he said.

Ghana’s government represented by Vice-President, John Mahama, and Employment and Social Welfare Minister, Enoch Mensah, agreed to the subsidy reinstatement in order to avoid the indefinite nationwide strikes promised by the TUC and other civil society groups.

Ghana government’s decision to remove fuel subsidies last year precipitated a similar governmental action in Nigeria, but the country did not witness the kinds of widespread demonstrations which brought major Nigerian cities to a standstill.