Transport industry players and other stakeholders have reiterated a call for more government support to temper rising fuel prices, and blunt the impact on families and businesses.
The latest plea comes as Thailand mulls allocating 500 million baht ($15.5 million) to provide loans to Covid-19-affected businesses in a bid to dampen the impact of high oil prices on the cost of living, as reported by the Bangkok Post at the weekend, citing finance minister Arkhom Termpittayapaisith.
For the February 1-15 period, the government set the retail prices of regular petrol and diesel at 4,500 riel ($1.11) and 4,250 riel, respectively, or up by 9.76 per cent and 13.33 per cent from the lows seen in mid-to-late December, according to notices from the Ministry of Commerce, which has pinned the uptrend on rises in international crude oil rates.
Logistics Business Association president Chea Chandara told The Post on February 15 that the surge in fuel prices in recent months have adversely affected the transport sector, eating into profits.
Suitable government intervention in fuel rates would improve family incomes and people’s livelihoods, he said.
“If the state can afford to help – like Thailand where the government has disbursed some money to help reduce fuel prices in the country – that would be great, and not just for the transport sector – the general public would also benefit from the help,” Chandara said.
Royal Academy of Cambodia economics researcher Ky Sereyvath said that, in theory as well as in practice, the government can intervene in market issues, depending on the state budget.
If the state believes that it can implement intervention measures able to stem soaring fuel prices, it could disburse the required funds, he said, suggesting as possibilities a reduction in import tax rates for crude oil products, or merely setting retail petrol and diesel rates lower.
Either way, the economist acknowledged that this would result in losses for the national budget. “If the government lowers taxes on oil imports, that would provide an opportunity for private companies to import more, but that’d lead to a loss in national revenue,” he said.
Sereyvath noted that the costs borne by the state would hinge on import volumes and not on end-user consumption, which he predicted would close the gap between wholesale and retail prices.
To make matters worse, space in the state budget is limited, with spending on Covid-associated matters most likely taking precedence, as much remains uncertain amidst the continuing spread of the novel coronavirus, he said.
Ministry of Economy and Finance spokesman Meas Soksensan briefly told The Post that the priority for government spending is to assist the poor, which he said the state has consistently acted on.
He did not specify whether the government would act to relieve some of the impact of heating fuel prices.
The government has rolled out 10 rounds of economic relief measures to manage the impact on key sectors from Covid-19 and the ongoing recovery process, and bolster economic growth during and after the crisis.