When Fuel Prices Rise, Namibians Start Looking For Relief

A fuel price increase of N$2.50 to N$4 per liter is not merely a technical adjustment. It is a national economic event. The knock-on effects are felt across all 14 regions.

In Namibia, fuel is not just a commodity; it is the bloodstream of the economy. It moves goods, connects people, powers industries and underpins our ambition to become a regional logistics hub.

When fuel prices rise sharply, the effects ripple through every household, every business and every sector. Our vast and sparsely populated nation needs fuel to stay connected.

The question, therefore, is not whether such an increase matters. It is how deeply and how unevenly the pain is felt. As usual, it is Namibians trying to make ends meet and keep their heads above water who will feel the pinch first.

Transport costs rise almost instantly, and pump prices increase. Taxi fares adjust; taxi drivers pass the increase on to their passengers.

Customers who count every coin when taking a taxi to and from work feel the pain. Freight becomes more expensive. These costs quickly cascade into the prices of food, building materials and everyday goods.

Nobody wants to bear the brunt of higher fuel prices, so it gets passed on like a hot potato, with the end consumer eventually paying the price.

For ordinary Namibians, the true cost of rising fuel prices is a loss of purchasing power. Wages do not adjust overnight, yet prices do. Lower-income households are disproportionately affected.

The price shock has a disastrous effect on our people.

Every business faces rising operating costs due to higher fuel prices – every farmer running their tractors, generators and machinery or simply driving around and to and from their farms.

The tourism industry must recalculate its transportation budgets across the board. Tourists may decide not to book holidays due to higher jet fuel prices.

It will severely erode Namibia’s competitiveness and slow our fragile economic recovery.

It seemingly never ends. Namibia’s long distances, reliance on road transport and exposure to global fuel markets make it particularly vulnerable to such shocks.

Every country is dealing with higher fuel prices, but some have stronger financial buffers to absorb these shocks. Some countries are already subsidising price increases to offset the pain at the pump for consumers.

What can we do?

• Targeted protection for vulnerable households and public transport
• Phased fuel price adjustments, especially with the Namibian winter just around the corner
• We need to protect the food supply chains and commuter mobility
• Accelerate rail and logistics reforms
• Strengthen market oversight and transparency

A fuel increase of this magnitude will test Namibia’s resilience. But it also presents an opportunity to strengthen systems, improve efficiency and protect the most vulnerable.

It also makes an interesting case for accelerating and continuing the development of alternative and renewable energy sources that Namibia is already pursuing. We are on the right track; the sooner we get more solar power online, the sooner we can start powering electric vehicles, for example.

Namibians always need a hike, from one town to the next, or a hike for a small package. With these unrelenting fuel price hikes, we will be less inclined to offer people a hike. We must weather this fuel price storm together, just as we always do as Namibians.

– John Steytler is a former presidential economic adviser and founder of R&J Steytler Management Consultants.

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