40 pct of energy subsidies for oil products benefit the rich: OAPEC – IMF estimates show volume of energy subsidies amounted to $278.8 bln

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KUWAIT CITY, March 20, (KUNA): High income citizens in OAPEC’s member states benefit by a proportion of 40 percent from subsidies for oil products, the organization said in its monthly report.

Member countries of the Organization of Arab Petroleum Exporting Countries (OAPEC) subsidize basic products, namely fuel, as part of welfare strategies for the peoples.

Citing estimates by the International Monetary Fund (IMF), the OAPEC report showed that volume of energy subsidies in the member states amounted to $278.8 billion in 2011.

Such a policy had proven positive in the beginning, however with time “some negative manifestations have come to the surface particularly with rapid and mounting local consumption of fuel. This is largely attributed to speedy populations’ growth, mounting numbers of towns and cities, roads, power stations and infrastructural installations.”

“Due to the current mechanism in implementing fuel subsidy policies, the segment of high income has benefited at great rates as compared to those of limited income,” the OAPEC report explained further.

Although the wealthy citizens in the OAPEC countries are the smallest segment, they benefit by 40 percent from the subsidies for fuel and oil products.

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