Fuel Pricing – Case for parity with neighbours

Fuel prices in Ghana have once again been pegged lower than those of neighbouring countries, creating jobs, illegal though, for border residents.

Even though it would be difficult to estimate the quantity of petroleum products that are smuggled out of Ghana daily, from all indications it is very substantial.

Smuggling of fuel along the eastern border with Togo has come to the notice of Mr Joseph Amenowode, Volta Regional Minister, who has described the phenomenon as a security scare, necessitating action by the Volta Regional Security Committee (VREGSEC).

He mentioned Dzodze, in the Ketu-North District, Aflao, the main eastern gateway to Togo and Segbe-Junction areas in the Ketu-South District as the centres where the business of ferrying petroleum products across the border was most prevalent.

Reports indicate that the fuel business is happening all along the borders, east, west and north. By land, river and where feasible sea, smugglers from Ghana continually ferry out fuel to build other economies that keep fuel prices high.

Mr Amenowode intimated that VREGSEC had been meeting to design ways to fight the canker and so would the other regional security committees.

One would suggest that the carrot and stick approach should be used in solving the problem. Massive education campaign should be launched among residents of border towns. They should be told about the implications of smuggling petroleum products to neighbouring countries.

Fuel should not be sold to people in jerry cans neither should there be any sales at night. Fuel stations that are known to be aiding the smugglers should be closed.

The personnel of the Customs, Excise and Preventive Service (CEPS); Ghana Immigration Service (GIS); Police Service and other security services should trail, arrest and prosecute perpetrators of this act.

However, it might be noted when these measures were applied in the past they yielded very little results.

During the era of President Hilla Limann of Ghana’s Third Republic, he said he preferred using economic measures rather than administrative measures to curb smuggling.

He said the cost of recruiting the men, training them, providing the equipment and paying them to control smuggling was certainly far higher than the pursuit of policies that made smuggling of goods, especially fuel out of the country unprofitable to those who risked that venture.

In the 1970s and early 1980s when petrol was subsidized in Ghana, some school kids in the Ketu District used to go two round trips into Togo with fuel products before attending school daily.

This Writer, who grew up in a border area, could remember vividly that barrels that were ostensibly for storing water in many households in those days rather contained fuel.

He remembers that taxis plying routes into Togo enlarged their tanks, filled them with fuel, siphoned it in Togo then came back for more. This gave them higher returns than haggling for passengers. It was very difficult curbing fuel smuggling then. It would not be any different now.

Not even a dog trained to track down smugglers by following whiffs of fuel worked. The trend was for the then Border Guard Officers to compromise the law right before the eagle eyes of the duty conscious canine.

At present a smuggler, who is able to get five litres of petrol out of Ghana into Togo makes a profit of about four Ghana Cedis, which is far above the minimum wage and, therefore, makes good economic sense to engage in it.

“They are only being rational. There are no jobs and taking fuel out of the country is better than stealing – a fast business and the yield are good,” an Ex-Sailor, now working for a private security company rationalized.

This is good business indeed, especially since the probability of being arrested is very low. There are simply not enough security personnel to effectively police the country’s borders.

The situation has put Customs and Immigration Officers along the borders in a quandary. To compromise with the fuel smugglers or not to compromise – that is the question.

The fuel smuggling business has a serious social cost too. Not easily seen though, but this story of a man, who was a successful fuel smuggler in the late seventies and early eighties would give the reader some inkling into the problems that the canker could cause a nation.

Mr Sotonshi Atadi, (not his real name) worked as an attendant at a fuel station in a town some two kilometres away from a border. He got rich, colluding with smugglers. He even bought a tractor. As the cash flowed his social standing rose. He celebrated his new standing by marrying two more wives. The three wives gave him many children.

Then there was policy change and fuel smuggling became unprofitable. Atadi’s kingdom crumbled as he was overwhelmed by his responsibilities.

That is to say fuel smuggling could give a false sense of wellbeing among people in the border areas.

Fuel smuggling attracts many minors and young people whose schooling could be truncated. Their immaturity could lead them into early family life, without any skills, confused by the inflow of fuel cash.

It is in the face of these realities that this Writer would wish to suggest that Ghana fixes fuel prices at parity with her neighbours. It would serve this dear country of ours better; campaign promises notwithstanding.

A GNA Feature by Sepenyo Dzokoto GNA