I cannot tell you how many people had
asked me to do a commentary on the findings of the Commission of Inquiry and
the reinstatement of Ronald Gajraj as Minister in this country, my position was
that since the International Community were condemning the situation as
vehemently as we were, Dr. Luncheon's non negotiable position was going explode
right in his face. It had to, since this was one time when the entire International
Community were as outraged at what was going on as we were, so anything that I
had to say on this matter would be unnecessary.
Ladies and gentlemen we may have this
perception that the International community is not looking on at what is going
on here, but they are, they are mostly diplomats so they will not usually make open
statements of condemnation as they did in this matter, and that is why I knew
that the PPP were not going to get away with this atrocity, so there was no
necessity for me to comment on it. And simply condemning what they perceive as
wrong doing by any government does not constitute interference with that
country's sovereignty, if they had tried to do something about it that would be
a different matter.
So since nobody else has thought of
it, tonight, on behalf of all right thinking Guyanese, I want to thank
the International Community for their condemnation of the actions of the PPP in
the Gajraj matter and for the result which their condemnation yielded.
And I also want to congratulate the
opposition, all of them, except Nadir of course, for standing together
and for the restraint they showed in this entire affair.
Actually tonight I want to talk about
fuel. Especially as it pertains to Diesel since our fishing industry which
brings in more foreign exchange than rice is about to collapse.
At the risk of breaking the law I will
deal in gallons since my mind is not programmed to deal in litres. The Standards
Bureau will just have to forgive me.
In my commentary gasohol E85 aired on
the 28th August 2001, I told you that we import 25 million gallons
of gasoline a year for our cars and that in the 6 months previous to my
commentary in August 2001 the average price of a gallon of gasoline was US 89
cents landed here in Guyana, using the Bank of Guyana statistics for 2001 that
would have been at an exchange rate of 191-1 or G$170 a gallon. Now let us
understand what this price was for, this was for on going exploration for new
oil fields, drilling and pumping the oil out of the ground, transporting the
crude to the refinery, refining it to its various components, oil, diesel, gas
etc, storing it, taking it to the ships and shipping it to Guyana, but at the
gasoline station when the Guyana Energy Agency [GEA], the fuel distributors and
fuel retailers got done with putting on their taxes and mark-ups on it here in
Guyana, we ended up paying G$347 a gallon. That is 100 percent more than this
fuel cost us landed here, now the GEA was collecting 50 % Consumption Taxes on
this fuel which made the price G$255/gallon and the wholesalers and the
retailers [the fuel companies] were making 92 dollars a gallon. Now based on a
25 million Gallons a year usage, the fuel distributors/retailers made 2.3
billion dollars and the government made 2.1 billion Guyana dollars in 2001 on our
gasoline alone.
last month April 2005 a shipment of Gasoline
was received here in Guyana, the price per gallon in Guyana dollars for this
fuel was G$402.32 when the government's 35.40 % Consumption Tax was added, this
raised the cost of this fuel to G$563.25/gallon when this gas is sold at the
pump, the price to us Guyanese will be G$659.17 cents per Gallon! So to take this
fuel from the ship to the pump including storage, the fuel companies are going
to get 2.398 billion dollars this year based on an annual usage of 25 million
gallons. But the government notwithstanding having reduced the consumption
taxes to 35.40% from 50 % are collecting 160.93 a gallon or 4 billion dollars
based on a 25 million gallons a year usage, nearly double what they made in 2001,
they are making more profit on this situation than OPEC.
Now we come to the really weird part
of this equation the price of diesel fuel is inextricably linked to our
agricultural industries especially the Fishing Industry and whilst the price of
diesel is rising 175% from July 2002 to April 2005 the price of fish has been
declining, there are two facts that every Guyanese should know 1. The fishing
industry in this country earns more foreign exchange than rice does and 2. under
our very noses it is dying because even though we were the 8-9 largest supplier
of shrimp to the US in 2003, our production has been declining whilst the
trawler owners haggle with the government over the consumption tax on fuel so
we have lost ground and are now the 13th largest supplier of shrimp
to the US in 2004, here are the export figures of Guyana's shrimp to the US since
2001, in 2001 we exported 20.3 million to the US, in 2002 it was 22 million
Lbs. in 2003 it was 25.2 million Lbs., and in 2004 it was 18.6 million Lbs.
Now before I tell you how much the consumption
tax on fuel for trawlers is, I have to tell you that fish, especially prawns,
exports to the US is money in the bank and whilst the price of fuel is high today
it is far more likely to come down after the war in Iraq is over and the world sorts
out China's insatiable desire for fuel at any price, making shrimping a more viable
long term industry than sugar so let's stop having pipe dreams for the survival
of our sugar industry, we are wasting time we should be looking at alternatives
right now! I am saying this as a Vieira, with family which has interests in
Sugar Cane.
The government has now dropped the
consumption tax on diesel to 20 %, the price of the last shipment of diesel fuel
landed here in April at G$383 Guyana a gallon and after consumption tax was
added the price became G$460 a gallon, but this same fuel is being wholesaled
at G$573 a gallon to the agricultural sector. So the wholesale distributor
whoever they may be Shell, Texaco etc. are making 104 dollars a gallon, now
here is a government under pressure of losing another industry and is dropping
the consumption tax on diesel to 76 dollars a gallon whilst the distributors
are collecting 104 dollars a gallon on the same fuel! Using an estimated
consumption of 10 million gallons for the fishing industry alone, that's a
whopping 1.04 billion dollars a year, to this we have to add the 2.4 billion
they are racking up on our gasoline, that comes to nearly G$4 billion this
year! And remember we have not yet looked at the diesel usage for
commerce and the other agricultural sectors such as sugar and rice so the
distributors' share of this pie could go as high as 5.4 billion dollars this
year! And that is why our fuel costs more than anywhere else.
Now I am all in favour of private
enterprise, even Freedom House will agree, it's the only thing we agree on,
Tony Vieira is a capitalist, but there are rules ladies and gentlemen fuel distributors
should not be making these huge profits whilst driving another capitalist
operation, which is their customer, into the ground and the country along with
it, since this is one of our more important industries. And no government
should be extracting such huge fuel taxes from such a poor nation in these hard
times.
