In the wake of the fuel price cut

I refer to the most recent news about the 20 per cent reduction in fuel prices for us consumers as announced last Saturday when we were told that that fuel prices at fuel stations will be reduced as from last Monday. I would like to praise the decision and even encourage further price reductions.

Fuel price reductions are very positive for the economy and we, as consumers, welcome such price cuts as we all stand to benefit.

The industry benefits directly because production costs are reduced and consumers also benefit indirectly through reduced retail and services' costs.

The lower fuel prices mean cheaper services' costs to households, in our food and retail industry, in imports and in the manufacturing industry including construction, in our daily consumables and in the catering and hotel industry, including tourism.

Thus, consumers would now expect prices of daily purchased items to be reduced too. Therefore, reduction of labour and production costs should now be reflected in cheaper prices at retail stores.

However, we must not forget that prices are still expensive when compared to the normal fuel prices we are used to pay in Malta. Only a few years back we all remember paying 16c.5 (€0.38c) per litre of diesel and 26c (€0.61c) per litre for petrol.

The British government has recently drastically reduced the price of fuels and also reduced the VAT rate to help strengthen the economy in such a difficult situation of global recession and financial crisis.

Perhaps the authorities here would follow suit and cut fuel prices further to help boost the economy, thus help encourage production and increase job opportunities by boosting sales through more spending power.