The Minister of State for Energy, Hon. Sidronius Okaasai, has reiterated the government’s position against subsidizing fuel prices. Instead, he has advocated for what he calls “e-mobility” as a long-term solution to the persistent rise in fuel prices.
Hon. Okaasai made these remarks in response to a report presented by MP Robert Ssekitoleeko (NUP, Bamunanika County) on behalf of the Committee on Government Assurances and Implementation during the plenary sitting on October 4, 2023.
The report criticized the government for its inability to stabilize fuel prices, forcing Ugandans to endure high pump prices. Hon. Okaasai urged against considering subsidies, stating that such measures have proven detrimental to countries that have implemented them, leading them into financial difficulties. Instead, he emphasized the importance of managing the supply chain to prevent hoarding.
He also emphasized the transition to electric vehicles, particularly those produced by the Kiira Motors Corporation, as a means to address the instability of fossil fuel prices.
“We are exploring e-mobility to reduce our reliance on fossil fuels, including electric buses developed by Kiira. We are currently conducting a study on establishing charging stations, not only in the city center but throughout the country. This aligns with our electrification strategy,” he added.
Regarding fuel reserves, the Minister noted that the current stock would only last the country for three days, with an extension to ten days relying on private sector reserves. However, contingency plans to increase government reserves to last ten days have been hindered by the Finance Ministry’s failure to release the approved US$30 million for this purpose.
Hon. Mathias Mpuuga, the Leader of the Opposition in Parliament, criticized the government’s hands-off approach and its tendency to attribute fuel price fluctuations solely to external factors. He emphasized the importance of petroleum products as a matter of national security and the need for government intervention to ensure economic stability.
Minister Okaasai also mentioned that the government intentionally grants licenses to many small fuel stations to counter the dominance of two multinational energy giants in the market.
Several Members of Parliament expressed concerns about the rising fuel costs, with some demanding a focus on addressing local factors beyond international influences. Calls were made for a revision of taxes on petroleum products, and it was suggested that cartels might be contributing to the price fluctuations in the fuel industry.
