World Bank’s Report on Fuel Subsidy Indicts the Rich

A new World Bank report said fuel subsidy benefits the rich more, and removing it “is a politically sensitive issue,” which must be “well managed.” The newly released report titled, “Africa’s Pulse”, said “fuel subsidies overwhelmingly benefit better-off families, with survey results for 12 countries worldwide showing that the top 20 per cent of households receive about six times more in subsidy benefits than the bottom 20 per cent.”

Noting that in 2010-11 over half of all African countries had some subsidy in place for fuel products, it said, “these in turn cost on average 1.4 per cent of Gross Domestic Product (GDP) in public revenues.” It specifically noted that, “Of the 25 countries with fuel subsidies, the fiscal cost of subsidies in six countries – primarily oil exporters – was at or above 2 per cent of GDP in 2011.” The World Bank report also noted that the fiscal cost in oil exporters was almost two-and-a-half times the levels observed for oil importers.

http://www.thisdaylive.com/articles/w-bank-s-report-on-fuel-subsidy-indicts-the-rich/114141/

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