In
an interview carried by the Engliash language daily 'The National', Minister of
Energy Suhail bin Mohammed Faraj Faris Al Mazrouei, explained that the UAE is
not comparing itself to the region any more. Excerpts:
Q: What is going to
happen to fuel prices after August 1?
A: Our studies show that the price of
diesel will come down and this is good news for consumers because diesel
affects everything that we use everyday, all the commodities that we buy except
our cars, our personal cars that take us to work. The equation has to be
balanced. When we looked at the price of petrol, it was regulated and fixed and
that encouraged lots of misuse of that commodity. Now, with the international
prices where they are today and where we are on regulated prices, they are not
so far apart so there will be an increase but it won’t be drastic, therefore we
encourage people not to panic.
Q: How
will this affect residents’ monthly spend?
A: Very few people have calculated how much
they spend on petrol. It’s something that people take for granted. The increase
won’t be drastic but it will create a shift in the mindset that this commodity
is like any other with prices that go up and down. It will lead customers to
use the finite resources that we have wisely.
Q: How
will this affect residents?
A: The increase in cost will affect us as
individuals. It’s not going to be drastic because the average budget of a UAE
national won’t be affected. If we’re talking about high-income expats, it won’t
be something major. For the low-income expats, those making Dh2,000 to Dh3,000,
they will have a choice to make. If a few hundred dirhams are affecting your
budget then this is a decision you have to make.
Q: How
will the prices be determined?
A: On the 28th of every month there will be
a calculation of the actual petrol price and diesel price using international
benchmarks. After adding transportation, operation and distribution costs, the
average of the month will be determined. The price for the month of August for
example is going to be set by July 28.
Q: Are
you pushing for low income people to start using public transport?
A: In any society, any civilised society,
people with low incomes take public transport except in the UAE and the Gulf.
Everyone drives a car even if they cannot afford to drive a car. We cannot ask
the Government to subsidise those people when they shouldn’t drive cars. Public
transportation is good and we are spending a lot of money and time to improve
it.
Q:
Will we see fewer cars in the UAE?
A: We have three million cars on the streets
and the growth is about 9 per cent every year. That is not sustainable. We are
not removing the subsidy because we want people to use the public transport, we
are saying some people will need to make that choice at some time – not soon
because the price change will not be great but in the future that could happen
and people will need to make a rational choice.
Q:
Where will the saved money go?
A: The Government pays more than any other
in the world on its people and infrastructure. The savings will be used to
improve our infrastructure and lifestyles. We’d like to preserve this lifestyle
for generations to come. It’s selfish of us to only think of ourselves. As
policymakers, we are entrusted by the Government and the people to make the
choices that make the economy stronger, and to do that we need to look at good
global examples. Those countries that are doing well are making sound policies
and moving towards sustainable growth rather than an unreal subsidized economy.
Q: How will the new
policy affect the environment?
A:
This decision is going to save it. There will be fewer cars on the road and
demand for fuel-efficient cars will increase. That is going to be a concern for
people now. Those fuel efficient cars produce fewer emissions and that will
lead to improved air quality – it means efficient consumption and lower CO2
emissions.
Q:
What do you say to people who are comparing the increased gas prices in the UAE
to that of other GCC countries?
A: People should focus at how much they make
and how much they’re spending on petrol and not compare with other GCC
countries. It has to be a fair comparison. You could compare yourself to
Venezuela, where petrol is really cheap but people in the UAE make more. It’s
not an apple for apple comparison. We can’t comment on other countries’
policies. We are entitled to our own policy. We are not comparing ourselves to
the region any more. We are aspiring to build one of the strongest economies in
the region. –End-
Image by: http://www.thenational.ae
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