Economist and Political Risk Analyst, Dr Theo Acheampong, has projected that the price of fuel at the pumps may fall should the cedi appreciate against the dollar.
He explained that the reasons for the high cost of fuel are the international pricing of oil and the cedis’ free fall against the dollar.
Therefore, Dr Acheampong said should the price of oil stabilize on the global market and the cedi’s foreign exchange performance be stabilised it could result in the reduction of fuel prices at the pump.
He made the comment on Asempa FM’s Ekosii Sen programme Wednesday while discussing the effect of fuel hikes on the Ghanaian economy.
Government has come under immense pressure due to the increasing prices of petroleum products. Driver unions who recently increased their fares are threatening more increment.
The hikes have been blamed on taxes on fuel with a call on government to remove them. Government in its justification has blamed the COVID-19 pandemic and Russia’s evasion of Ukraine as a primary factor.
But the opposition National Democratic Congress has argued that government is just using these two happenings as a smokescreen to cover up its incompetence – a position government has vehemently denied.
Reacting to this, Dr Acheampong said the impact of COVID-19 and the Russia/Ukraine war have had an impact on the Ghanaian economy.
He noted that because economies in the world are integrated, any shock elsewhere will have a big impact on a weak economy like Ghana.
“The global challenge has exposed the soft under belly of the beast. We are running a rudimentary economic structure,” he added.
A way out, Dr Acheampong said, is the scrapping and rationalisation of some taxes imposed on petroleum products in the country.
He is convinced it will go a long way to provide some reprieve to consumers who have had to suffer price hikes.
