Energy Analyst Benjamin Nsiah is calling for the immediate scrapping of the subsidy on premix fuel, arguing that the persistent diversion and smuggling of the product are undermining the purpose of the subsidy and causing significant losses to the state.
Premix fuel is a key input for fisher folk, particularly in Ghana’s coastal communities.
Data from the Chamber of Oil Marketing Companies, COMAC, contained in its first-year report for 2026, indicates that the product is being widely diverted and smuggled onto the market.
According to COMAC, government spends almost 600 million Ghana cedis annually on premix fuel subsidies, but the policy has yet to deliver the intended benefits.
Speaking to Starr News, Benjamin Nsiah urged the Ministries of Energy and Finance to take steps to immediately scrap the subsidy.
Mr Nsiah said the subsidy has not helped Ghana reduce its dependence on imported fish products.
“Premix has not delivered the higher retention we want because Ghana remains import-dependent when it comes to fish products, spending about 300 million dollars annually on imports, while premix is also costing the country almost GH¢600 million annually. So, it is not giving us the retention we expect.”
He also raised concerns about the diversion of premix onto the market, where he said it is sometimes sold as petrol.
“Premix is being diverted onto the market and sold as petrol. This could affect engines and vehicles because premix does not meet the required quality specifications for petrol.”
Mr Nsiah proposed replacing the current input subsidy with a credit subsidy, which he said would encourage greater efficiency and productivity.
“A credit subsidy promotes efficiency and productivity because the subsidy is linked to productivity and efficient use of resources.”
He argued that the current input subsidy system does not encourage the optimal use of resources and also places pressure on government revenue.
“It also continues to affect government revenue mobilisation and limits the resources available for other important and critical needs.”
Mr Nsiah further raised concerns about the alleged overpricing of premix fuel, despite the subsidy provided by the government.
“Premix is subsidised by about GH¢8 per litre, but if you go to the market today, a product that is supposed to be sold at around GH¢5 per litre is sometimes being sold for about GH¢10 per litre at the pump.”
He alleged that some beneficiaries of the subsidised product take advantage of the system to make higher profits.
“Some people who obtain this product take advantage of the system, allegedly through political interference or political affiliation, and sell it at higher prices, making significant profits at the expense of government policy and the public purse.”
Mr Nsiah therefore reiterated his call for the government to scrap the premix subsidy and consider alternative measures that would promote efficiency and productivity in the fishing sector.
Source: Starrfm.com.gh/Benjamin Sackey
