An economist has predicted more pains for the logistics sector and consumers as the logistics sector keeps battling to accept the first in history R20 per litre fuel hike describing it as ‘the worst is yet to come’.
Chief Operating Officer at leading freight business, Big Foot Express, Denesh Singh said the domino effect of the fuel hike would hurt consumers.
“The knock-on effect for logistics costs mean more financial pressure on consumers who have already had to contend with high input costs and the global shipping crisis currently putting strain on supply chains,” Singh said.
He added that the industry is experiencing its most trying time in decades – and is having to counter the crisis through various innovative mechanisms.
But they are running out of creativity and appears that they need state intervention.
“Two of the key factors contributing to high fuel prices are the weak value of the rand – which we can put down mainly to poor government economic policy and mismanagement of our fiscal affairs, and our government’s constant tendency to increase taxes on motorists through fuel-related levies over the years,” he said.
He added that the state will be hard-pressed to replace these revenue streams through other mechanisms.