Fuel levy 'will hike food prices'
Feb 11 2009 21:10
Ines Schumacher
Johannesburg - The higher fuel levy will have an adverse impact on consumers and business alike, says Bill Lacey, a consultant for the South African Chamber of Commerce and Industry.
Motorists, who have only recently started to feel the benefits of the markedly lower crude oil price, can expect the fuel levy on petrol to increase by 23c to R1.50/l and that of diesel by 24c to R1.35/l on April 1 this year.
Lacey expects the fuel levy to push up food prices. "The fact of the matter is that we are a very transport-dependent country and anything that impacts on transport - and obviously fuel - is going to be felt by everybody," he says.
Ironically, an industry in need of a financial stimulus which has been made provision for in the budget is the vehicle industry. "Some elements of the food industry - and perhaps some of the service industries - also need a bit of a boost," Lacey says.
The budget's stance on the South African export market is good for business. Lacey feels South Africans seem to be moving into a protectionist mode.
"I think the minister gave indications that he wasn't all that supportive of protection. Once you enforce protection on a country, you're going to have retaliatory activity from other countries you hope to trade with," he says.
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- Fin24.com
