Why Namibia must stop illegal fuel

19 August 2019 | Opinion

Abednego K. Ekandjo writes:

The petroleum laws are clear. Fuel is dangerous goods and it must only be imported into Namibia, stored and distributed when those involved have met certain conditions such as operating a registered and licensed fuel wholesale or retail business. Apart from the obvious and general socio-economic considerations such as investment promotion to create employment and the generation of state revenue, health, safety and environmental issues are also at the core of the criteria under which such licences are granted. Local social media is awash with all sorts of justifications for why people prefer to buy and use illegal fuel in their cars, ranging from affordability to supporting trade amongst African countries. However, I sense that those who are most vocal in support of this illegal fuel misunderstand the whole concept of why this fuel is illegal and why its use is being discouraged.

Firstly, engaging in unlawful activities is a criminal offence and the smuggler, seller and purchaser must all be held to account. Secondly, by going over the border and filling up your vehicle on the other side you are negatively affecting your country more than you realise. A case in point is the road user charge. You drive on Namibian roads using illegal fuel on which no charge was collected to keep your roads in a good condition. Then you start complaining and blaming the authorities because the potholes are irritating you or a certain road is taking too long to be developed.

Another case in point is the fuel tax. You are continually complaining about the lack of funding for quality education, better healthcare, etc., while at the same time you are the one destroying the funding mechanisms put in place by not only the Namibian government but by almost every government all over the world.

The social impacts may even extend to the promotion of crime. The legal fuel industry employs thousands of Namibians. By taking your money out of the country you are contributing to sector retrenchments and unemployment.

Furthermore, climate change is real, whether or not there are those who live in denial of this scientific fact. Namibia is a State party to the Paris Agreement dealing with the mitigation of greenhouse gas emissions, amongst other efforts to combat climate change. To honour her commitments to the global community Namibia has since phased out leaded petrol (harmful) and is in the process of phasing out high sulphur diesel (harmful). The fuel classified as illegal does not meet the current specifications required in a modern world.

Moreover, building a modern refinery that can produce the right standard fuel will cost +/- US$10 billion (it is simply unaffordable for a developing country). All in all, illegal fuel trading must, therefore, not be allowed to take a foothold in Namibia. The possible consequences will be too drastic to cope with.

* Abednego K. Ekandjo is the acting chief economist at the directorate of petroleum affairs

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