Serious impact of petrol price hike
The petrol price increase will have a trickle down effect making ends meet a lot more difficult.
HUNDREDS of motorists were seen queuing at petrol stations in Zululand on Tuesday, before the petrol price increase of 31cents/litre took affect at midnight.
The latest increase is due to the rise in the price of crude oil which peaked at above 115 US Dollars per barrel, and the depreciation of the Rand/ Dollar exchange rate from $10.40 to $10.68 during the period under review.
This increase has set in motion a range of costly consequences for Zululand’s industries. Economists are warning that consumers are going to find themselves under increasing and unusual pressure over the next few months.
The price of petrol is a key indicator in the South African economy. It affects those who can afford to travel by car, but also impacts all consumers through the increase in the cost of public transport and the transportation of goods.
An increase in the price of petrol will inevitably lead to an upward pressure on inflation.
According to Zululand Chamber of Commerce and Industry, Empangeni Divisional Chairperson, Mike Patterson, the fuel price increase will have a detrimental effect on all commodities.
‘Input costs will be increased which is automatically passed on to product prices and ultimately to consumers,’ he said.
‘Unfortunately Zululand is transport reliant especially with goods and products from Gauteng and Durban. This extra expense will have to be absorbed by the business, which in turn has a trickle down effect to the consumer.
‘Another major major concern is that food and transport inflation results in workers seeking higher wages which creates higher production costs. It will also reduce the rate of investment, which will only add to the unemployment problem.’
With the rand already on the back foot due to strikes in the engineering and metal sector, any reprieve for the motorist is unlikely in the near future.
Follow @AndrewCornew
hahahaha ey south africa. Nice job making everyones life more expensive. Soon all the guys who are actully making your country money will all leave. Best Of luck!
Well said Hanan. Do these striking fools realize that the ripple effect that strikes and ridiculous salary increases cause? Increased cost of items or services, possible reduction in staffing levels or even closure of the business they are wrecking. The best thing is that they then have to pay more for products on the shelves because of the increased production or transportation costs. Who is the winner here? The government through increased taxation receipts What a pleasure it is to work and live in a country that has sustainable development where strikes are unheard of. Go for it South Africa