Henry Amorocho, professor of public finance at the Rosario University, He pointed out that this measure will help inflation to remain at a high level as such an important sector as transportation will raise rates due to the constant increase in regular gasoline.
“The price of gasoline is a multiplier of the price increase, since the first thing that directly affects it is the price of transport. This will result in an increase in transport services in its various dimensions, especially in taxis,” explains the expert.
He added that another effect consumers will feel comes from the mobilization of agricultural products and food from the countryside to the supply centers.
“As the price of gasoline rises, it translates into a rise in food prices, and in that order of ideas there will be increases not only in the staples of the family basket, but also in the values of each meal in the various restaurants and gastronomy points across the country. In addition, prices in hotels will rise,” said Amorocho.
In this sense, Fernando Salazar claimed that the first sector affected by the rise in fuel prices is land transport.
“Given the peculiarities of our country, where most of the freight transport is done by road, this increases operating costs and affects all supply chains, mainly food and other commodities for production in all regions,” the analyst stressed.
In this sequence of ideas, Salazar explained that these behaviors reduce the satisfaction of needs due to the loss of purchasing power of the consumersand also jeopardizes projected economic growth for this year.
Source: El heraldo
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.