Will the declining fuel prices fix trade deficit?

Editor, Reference is made to Sunny Ntayombya’s article, “Ditch that Prado and buy a tractor” (The New Times, January 7).

Monday, January 12, 2015

Editor,

Reference is made to Sunny Ntayombya’s article, "Ditch that Prado and buy a tractor” (The New Times, January 7).

I want to reinforce fellow commentator’s thoughts by saying that we are 100% not an industrialised nation, and our economy is not going to benefit from the current global price falls in fuel cost.

This is not pessimism but rather being realistic. What we have to do and continue doing is to add value to our primary agricultural products, fix our education system and change the paradigm of success; our country does not need Prados and V8s but tractors and heavy machinery to produce value added primary agricultural products.

And wit time we will not need any more financial aid from the developed world.

Daoud

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"Government should go so far as reducing the import duties on mass transport vehicles such as buses. With buses on even secondary routes (as I call neighborhood roads) less people would need to buy cars to avoid ‘ivumbi’ (dust).”

The above suggestion would not reduce the number of cars being imported into the country. Rwandans are getting richer every day and will always want to fulfil their dream of joining the "My Car Club” to show that they haven’t been left behind.

A good number of citizens would afford to buy a 15-year-old Japanese car costing about $3,000. Such a car would probably cost the country twice as much in terms of imported fuel and spare parts, by the time it goes to the junk yard, and also wiping out all the taxes that went to Rwanda Revenue Authority.

For me, the best strategy to reduce the number of cars being imported into the country and contribute to the improvement of the country’s balance of payment would be to impose age limit on imported cars.

Decades ago, Godfrey Binaisa, the then president of Uganda suggested that no second-hand vehicle older than four years was going to be allowed into the country after four years starting from the date of his statement. I am not sure this was ever implemented since I left Uganda soon after.

To be fair to Rwandans and also cater for the country’s interests, no car older than eight years should be imported in the country. Alternatively, some kind of taxes should be imposed on very old cars to dissuade people from importing them.

Andrew

The writer has to be the most pessimistic person ever! Yes there is a way we can balance our trade, if we supported our primary products.

We are not going to produce planes overnight, but we can reduce on the Rwf 2 billion we use per year on importing fruits from neighbouring countries. Yes it can be done; don’t sit back and wait for foreign aid. We shall not always have it. So think positive please; it starts with you and me.

Johnson

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Before we even go to balance of payments we need to make sure we "all” benefit from this fuel free-fall. Since July the price has fallen more than 40% but the drop in pump prices is not commensurate, both in figures and timing. So, who pockets the difference?

Ed