Fuel price: Austerity is about stopping waste
We cannot control world oil prices. Those wars in the Middle East push it up, and we just pay. What we can control is how much fuel we waste, writes Kiryowa Kiwanuka
Kiryowa Kiwanuka. (File)
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OPINION
By Kiryowa Kiwanuka
On Wednesday during plenary, I made a comment about reducing unnecessary movement as one of the measures to manage the rising cost of living. The comment was widely discussed on social media, with many Ugandans worried that the Government wants to restrict them from moving to earn a living. I want to provide the full context and what the numbers show.
Uganda is facing a fresh fuel shock. Brent crude has risen from $71 in July to $101 today due to attacks on Saudi oil fields and the escalation in the Middle East.
Today, on our pumps, diesel has risen from sh5,090 in March to sh6,950. Petrol has jumped to over sh7,000. In September alone, Uganda Bureau of Statistics (UBOS) reported fuel inflation at over 30% and transport at 9.8%. Bank of Uganda has already warned that this is pushing up transport and food prices.
This is the context in which I raised the issue of fuel austerity in Parliament. It is not an academic debate. I want to clarify what I meant about reducing unnecessary movement.
Matooke from Mbarara, beans from Lira, tomatoes from Kabale — they all come to Kampala on a truck that uses diesel. When diesel goes from sh5,000 to almost sh7,000, the matooke price also goes up.
So, fuel price is not a driver’s problem. It is a food problem.
We cannot control world oil prices.
Those wars in the Middle East push it up and we just pay. What we can control is how much fuel we waste.
Today, Uganda spends almost $2b every year just buying fuel from outside. That is most of the dollars we lose as a country. Every litre we save is a dollar we keep here to support our shilling.
If we reduce wasted fuel by just 10% – through shared private and government cars – we could save about 210 million litres. That is roughly $190m to $210m per year kept inside Uganda.
It reduces pressure on our shilling at sh3,920 and reduces the cost for all imports. So, saving fuel helps keep the shilling stable and helps keep prices low. I did not mean Ugandans should stop moving. For a bodaboda rider, a market woman, a farmer – movement is how they eat. If they don’t move, they don’t earn.
What I meant is we should stop wasting fuel. First, we have many cars moving with one person.
If all of us, private persons and MDAs, share cars through carpools, we save fuel.
The idea is simple: Move people and goods, not empty cars.
If we burn less fuel without stopping business, we keep those $200m in Uganda, we help the shilling, we reduce transport cost, and food price can come down.
That is the austerity I meant. Not stopping wanainchi from working, but stopping waste.
The writer is the Minister of Defence and Veteran Affairs