Xinhua, Johannesburg :
South Africa’s escalating fuel price hikes are likely to have “catastrophic” impact on the shrinking economy, increase the cost of conducting business and reduce consumers disposable income, economists warned on Tuesday.
The Energy Department this week announced that petrol price will go up by between 99 cents and R1.24 a litre from Wednesday. Motorists in some provinces will pay R17.08 for a litre of unleaded 95 petrol.
This is the seventh petrol price increase since 2018. A weak rand and rising international oil prices are some of the major contributing factors behind the rising fuel costs in South Africa.
Efficient Group’s chief economist, Dawie Roodt told Xinhua on Tuesday that the latest fuel price increase will leave average consumers with less disposable income.
“This is part of bad news that have been hitting consumers in South Africa, as we have seen a number of petrol price increases this year alone. We have seen an economy that is contracting, an increase in poverty, an increase in unemployment, so I am afraid, this is just the last in a series of bad news happening in our economy,” he said.
Roodt said that the rising petrol price will have an impact on the contracting economy.
“This is going to put pressure on inflation again and eventually the Reserve Bank will be forced to hike interest rates and that will put more pressure on the economic growth,” he said.
South Africa’s escalating fuel price hikes are likely to have “catastrophic” impact on the shrinking economy, increase the cost of conducting business and reduce consumers disposable income, economists warned on Tuesday.
The Energy Department this week announced that petrol price will go up by between 99 cents and R1.24 a litre from Wednesday. Motorists in some provinces will pay R17.08 for a litre of unleaded 95 petrol.
This is the seventh petrol price increase since 2018. A weak rand and rising international oil prices are some of the major contributing factors behind the rising fuel costs in South Africa.
Efficient Group’s chief economist, Dawie Roodt told Xinhua on Tuesday that the latest fuel price increase will leave average consumers with less disposable income.
“This is part of bad news that have been hitting consumers in South Africa, as we have seen a number of petrol price increases this year alone. We have seen an economy that is contracting, an increase in poverty, an increase in unemployment, so I am afraid, this is just the last in a series of bad news happening in our economy,” he said.
Roodt said that the rising petrol price will have an impact on the contracting economy.
“This is going to put pressure on inflation again and eventually the Reserve Bank will be forced to hike interest rates and that will put more pressure on the economic growth,” he said.
