BOGOTA – Thousands of protesters on cars and motorbikes took to the streets of Colombia’s main cities on Monday to reject recent hikes in gasoline prices that have drastically increased the price of fuel in the South American country.
Protesters say that the monthly price hikes set by Colombia’s first leftist government are making it harder for small businesses to operate, and could push up the price of food.
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But the government of President Gustavo Petro says the gasoline subsidies cost about $11 billion a year. It says it must eliminate the subsidies to pay debts to the national oil company Ecopetrol, which produces most of the country’s fuel, and to free up more funds for social programs.
The protest comes as discontent grows with Petro's administration a year after he took office promising to reduce poverty and make peace with the nation’s remaining rebel groups.
Petro’s administration has struggled to stop violence in rural parts of the country, and to boost Colombia’s economy, which is expected to grow by just 1% in 2023, according to the International Monetary Fund.
“This government is making decisions that are anti-business,” said Alejandra Mendoza, the manager of a small company that transports frozen food and other goods for supermarkets in Colombia. She attended Monday’s protest wearing her company’s yellow jacket.
“Our costs have gone up by a third, and we have to adjust our budget each month because of the gasoline hikes” Mendoza said.
The price of gasoline in Colombia has risen from 9,000 pesos a gallon in August of last year (US $2.50) to more than 14,000 currently ($3.40) as Colombia’s government cuts back on subsidies each month.
Officials in Colombia’s Finance Ministry have said they want gasoline to reach a price of 16,000 pesos per gallon --about $4 -- by the end of the year, which would mirror current gas prices in the U.S., where the federal minimum wage, however, is more than four times greater than Colombia’s minimum wage of $280 a month.
In July, the ministry said that subsidies for diesel, which is used by most cargo trucks in Colombia. will be removed after municipal elections in October, and that the price of diesel fuel will double by the end of next year.
Petro has argued that the nation’s gasoline subsidies mostly benefited wealthier Colombians who own vehicles. But he has shown signs that he is willing to negotiate gasoline prices with some groups.
Over the weekend, Petro’s administration cut a deal with the nation’s taxi driver unions, under which gasoline prices will be frozen for the country’s estimated 200,000 yellow taxis.
However members of Colombia’s opposition say that the government needs to go further because gas hikes are also hurting delivery workers, drivers and small business owners who are struggling to recover from the pandemic.
Jennifer Pedraza, a congresswoman who helped to organize Monday’s protest, pointed out that the government could moderate the hikes in fuel prices, by charging less sales taxes on gasoline and diesel.
“The people are asking the administration to negotiate a different gasoline policy” she said, adding that its time for Colombia’s national oil company to “take an interest, in making gasoline affordable for all.”