GOB to have greater control of butane prices

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The Government of Belize is moving to wrest the control of the importation and pricing of Liquid Petroleum Gas (LPG) in Belize. The move will see the establishment of a private-public company which will be solely responsible for the importation of the fuel into Belize. Currently, there is a single family, through various companies, that imports and sells butane to the Belize market.

That arrange has seen multiple occasions during which government officials and representatives of this family come at odds with each other over two particular issues, the price of the fuel and its quality. Because the family representatives are wholly in control of the importation of the product, it has allowed for instances where the price of the product to the consumer has been raised without any reasonable cause.

On Friday, the Government of Belize introduced legislation in the National Assembly in which that arrangement will come to an end. The government along with other shareholders will set up a company which will be responsible for the importation of the LPG. During the House Meeting on August 16, Prime Minister Dean Barrow explained that currently, there is an oligopoly. He added that, “basically it is one Mexican common denominator that owns all the principal retailers or certainly the wholesalers. So, we are in hoc to a Mexican concern. This will ensure that it is a Belizean concern, a public private company that will have the exclusive in terms of the importation. We, the government, whichever government will be on the board to ensure that, in fact, it is brought in a way that will see that what is happening to us now where the Mexicans all get together and basically, it’s one common ownership you know, whether deh name Z, whether deh name BWEL, whatever, and they hold us to ransom. They come and they say this is the price you will allow us to charge, otherwise we wah stop importing the gas. So this, if it does nothing else takes us out of that stranglehold that these foreigners have, on not just government, on the people of this country. And absolutely, with this National Gas Company, you will see a lowering of prices to the consumer.”

We are told that amidst the number of shareholders, the Government of Belize will hold at least a 25% holding in the company. This will ensure that any negotiations between the importer and the government will also see great government representation which is expected to yield greater benefits to the Belizean consumers. At the moment, Belizeans are subject to the so called oligopoly which dictates prices as well as quality of LPG imported.

Ideally, LPG that is consumed in the country should be in a ratio of 70% propane and 30% butane, but importers have often sold a mixture of 90% propane to 10% without any quality control. This too is expected to be remedied with the formation of the new public-private company.