More than 90% of public transport drivers use propane gas as their primary fuel, benefiting from hefty government subsidies on the fuel. But over the years, despite not using gasoline, the strong transport unions forcefully raised transportation prices when the price of gasoline was increased. Now that the days of the propane gas subsidy seem to be counted, they are threatening with RD$6-RD$8 fare increases if the government eliminates the subsidy on propane gas, thus duplicating fares for those using taxis.
The president of the Dominican Petroleum Refinery Aristides Fernandez Zucco has announced the subsidy would be eliminated this month. The elimination of the subsidy affects home budgets, too.
To mitigate the effects on home cooking by indigent families, the government has distributed a welfare card after identifying hundreds of thousands of beneficiaries. Those holding one of these cards will be able to purchase a tank of propane gas for domestic use at RD$25 the gallon. Although the government is planning to distribute 400,000 cards for the subsidy to reach needy families, union leaders have said this action would only be “palliative”, as it would only benefit less than 20% of the homes that use propane gas.
But once the subsidy is removed, households that have not received one of the welfare cards will need to purchase the fuel at unsubsidized prices.
Cardinal Nicolas de Jesus Lopez Rodriguez asked the government not to withdraw the subsidy on gas. The Catholic prelate also believes the International Monetary Fund (IMF) should ease its demands and understand that the DR has complied with most of its requests. The government has gradually been eliminating the subsidy on propane gas in its effort to cut spending in order to make payments on international loans primarily taken on during the borrowing spree of the past administration.