Economist urges gov’t to reconsider fuel pricing decisions

3. Fuel Derivatives
(File photo: Ameer Khalifeh/Jordan News)
AMMAN — Economist Hussam Ayesh called on the government to review the mechanism for calculating fuel prices, given the economic challenges of global slowdown and rising prices. This is to mitigate the negative impact on citizens. He noted that the government's decision to adopt the Arabian Gulf markets in the "Platts" bulletin for fuel pricing has not reflected on costs as was expected.اضافة اعلان

The continuous price hikes will lead to a decline in growth rates, which are still ranging between 2–2.2 percent, and consequently inflation rates will rise, affecting the purchasing power of citizens, Ayesh said in an interview with Jo24.

He questioned the funds that successive governments announced to counter the rise in fuel prices and their impact on supporting citizens and alleviating the effects of price increases on them.

Decreased production and employment
Ayesh explained that raising interest rates by the central bank and increasing fuel prices will increase costs on different sectors, leading to a decrease in production. Prolonged increases will likely result in workforce reductions.

He said that raising fuel prices will also impact the government's ability to secure revenues due to the decline in citizens' purchasing power. He clarified that the recent revenue increase is due to tax evasion rather than economic improvement.

Ayesh noted that the government resorts to raising fees on official transactions without announcing it, in order to enhance revenue. Citizens often discover the existence of fees or their increase without prior notice when conducting transactions.

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