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Tanzania needs fuel-efficient cars - Ewura
2008-07-22 10:02:04
By Guardian Reporter
Banks have been urged to issue loans to motorists to enable them buy new and more fuel-efficient vehicles that will cut down petroleum consumption, now that the government no longer dictates the prices of petroleum products, whose prices have been skyrocketing.
The call was made yesterday by Energy and Water Utilities Regulatory Authority (EWURA) director general Haruna Masebu, when briefing the press on possible measures that could be taken to ease difficulties emanating from rising prices of petroleum products.
Masebu said such schemes were already applied in other countries, including some neighbouring countries.
He said petroleum prices in the local market had persistently continued to rise over the past one year.
Between May and June, this year, prices of petrol, diesel and kerosene had risen by 2.72, 7.19 and 5.25 per cent, respectively.
Masebu said the increase in the local market prices was caused by rising prices on the world market.
``Such an arrangement would enable motorists to pay for cars purchased over long periods, hence increasing their affordability.
New cars generally use less fuel per kilometre and many countries have well functioning lending schemes of this kind,`` said Masebu.
``As fuel prices are determined by the international market and not by the government as was the case before economic liberalisation, long-term measures, including purchasing vehicles with smaller engine capacities, are encouraged.
This measure is being resorted to in some countries in Asia and Europe, whereby carmakers are coming up with lighter but more fuel-efficient vehicles,`` Masebu added.
The Ewura chief said the situation in neighbouring countries was also similar to that obtaining here in Tanzania, adding that pump prices in some neighbouring and SADC countries had risen in almost the same proportions as those in Tanzania.
Comparing pump price rises during the months of May and June, this year; he said they had risen by 7.55 per cent in Tanzania, 17.99 per cent in Kenya, 7.5 per cent in Namibia and 4.25 per cent in South Africa.
Actual pump prices in South Africa were lower than in Tanzania by between USD 0.19 per litre and 0.33 per litre because purchases were made in bulk through term tenders, he said.
He said measures which needed to be taken by countries such as Tanzania so as to protect their economies and customers included resorting to efficient procurement of petroleum products in the short term and embarking on a gradual reduction in the use of imported petroleum in the long term.
``For instance, Tanzania may embark on the usage of natural gas to propel motor vehicles and substitute heavy fuel with gas to generate electricity in the medium to long terms,`` he said, adding that liquefied petroleum gas could also substitute kerosene at the individual household level.
``Ideally, the use of compressed natural gas should also gradually replace heavy fuel oil for industrial use,`` he said.
To date, up to 18 industries in Dar es Salaam use natural gas in industrial production.
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