The focus as team embarks on probing of fuel prices increase

Dar es Salaam. The government yesterday revealed areas of focus as a committee started investigating the reasons behind the fuel prices hike in the country.

The team is expected to look at the entire value chain including the price calculation formula and various levies, taxes, fees and charges that are taken into account in the fuel prices.

Others include bulk procurement mode of work as well as fuel passing through Dar es Salaam and Mtwara ports.

This is according to the governments spokesperson, Mr Gerson Msigwa, who briefed journalists on major events that took place during the week.

He said upon finalising the work in two weeks, the committee is expected to hand over its findings to Prime Minister Kasssim Majaliwa on September 16.

The committee comprises Energy and Water Regulatory Authority (Ewura), Tanzania Revenue Authority (TRA), ministry of Energy among others.

“The committee has been given two weeks to do its work and come up with a solution that will ensure the prices of fuel remain affordable and also identify underlying reasons behind it,” he said.

On Tuesday, Ewura announced price caps for fuels for September, indicating a new record in price increase. The price would have seen a rise for one liter of petrol, diesel and kerosene by Sh84, 29 and 18 respectively.

With the price increase, Dar es Salaam residents would have accessed a liter of petrol at a price of Sh2, 511, while that of diesel and kerosene would have been accessed for Sh2,291 and Sh2,194 respectively.

However, the government later halted the price changes announced for September, instead the August prices will continue being in use.

“The government recognises that the rise in fuel prices not only affects the national economy but also the livelihoods of Tanzanians,” he said.

Tanzania Association of oil and Marketing Companies chairman Raphael Mgaya commended the government for this decision but noted that to ensure price of fuel remained stable, the government needed to award BPS tender to foreign companies because it became much cheaper that way.

“During the month of July the government awarded tender for BPS to local companies, but according to him, it would be more expensive because the local companies were taxed corporate tax, local government levy among other charges, which ultimately increased the price of fuel,” he said.

He noted that the government also needed to create a mechanism that would stabilise fuel prices, citing Zanzibar, Kenya and other countries which have come up with a mechanism that sets levies charged on fuel when global prices fall. This levy is later used to cushion the price when global prices increase.

“I also feel that the government should have considered stakeholders in the industry when forming the team to help in decision making,” he said.

Covid-19

On the issue of Covid- 19, Mr Msigwa said the government continues to stress the need for all Tanzanians to take precaution against the pandemic including avoiding gatherings, maintain social distance, putting on masks, washing hands using flowing water, use of sanitisers as well as taking the coronavirus jabs.

“The government received its first consignment of over one million doses of Covid-19 vaccines at the end of July, this year and launched a countrywide injection of Tanzanians from the age of 18 years with the aim of avoiding deaths and severe illnessnes,” he said.

He stressed that the public should only listen to health experts’ advice to enable them make informed decisions where currently at least 325,000 people have been vaccinated.

However, he noted that apart from the 525 health centres identified for the vaccine exercise the government was also looking to start outreach work for inaccessible areas.

Sugar supply

The government assured the public that there was no shortage of sugar despite it being a rainy season when factories suspend production.

He said the government has issued permits to businesses to import sugar meant to fill the gap. He noted that the country’s sugar production will increase in the next three years by 265,000 tonnes and thereby increase annual production by 669,000 tonnes.

Explaining, he said Kagera Region is expected to increase its production to 145,000 from 75,000 tonnes, Manyara currently producing 8000 tons while Bagamoyo is expected to start production in June hoping to hit 50,000 tonnes in three years time.

At the same time, he said the National Social Security Fund (NSSF) in collaboration with Prisons is also expected to start production of 50,000 tonnes before the end of the year.