Sharing Difficulties with Consumers

Previously, being aware of the oil reduction under 60 USD per barrel for such a long time, the government’s action was to have tax increasing on oil exporting and importing of 5% since September 11^th.

This action is extremely meaningful while national economy is developing under market mechanism and international economic integration as seen today.

Economically, reducing gasoline retail price will naturally bring great benefit for consumers. Moreover, this action will contribute to decrease inflation, to cut back product price (especially it reduces transportation services by land, by air and by sea), and to stimulate economic development. This policy is valued as a precious decision for the society. .

Firstly, the promise given by Mr. Nguyen Sinh Hung, Minister of Finance, has been carried out. Consequetly, the retail price at assigned rate would be reduced once the crude oil price dropped down under 55USD per barrel.

Moreover, the government precedent on adjusting gasoline retail price last August upon “market signal” depending on international market was positively confirmed.

Secondly, the sacrifice of consumers’ benefit during the difficult period was compensated efficiently. It was remembered that there were 7 changes in gasoline retail price from 2003 to present. Three out of them were made during the first eight months of 2005. (Some products were even increased with 20%).

The messages, which were announced by governing bodies such as: “Sharing difficulties among government, corporations and consumers”, “Governmental subsidiary is not permanent”, and “The routine on the changes of domestic gasoline price will depend on international market. Consequently, the retail price will be up or down due to the fluctuation of world oil price”… are shared and sympathized by consumers whenever the retail price was changed.

In fact, it was sometime witnessed that world oil price was brought down but the government decided to raise tax on imported fuel for the increasing of national revenue. As the results, the gasoline retail price was not cut back. Thus, consumers’ benefit was seemed to be as permanent lost. This has been changed. Even a minor change of 100VND per liter has shown a respect from the government to the consumers’ benefit and it shows straightforward and impartial relations among “government-corporations-consumers” in this sensitive type of business.

The message “together sharing among government-corporations-consumers” is understood either in difficult time or during favorable condition, the interest or the loss must be shared. This business theory for the market economy created confidence and acclaim from consumers.

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