Long lines of vehicles could be seen earlier today in parts of Roseau and environs as motorists lined up to fill up after the Association of Fuel Retailers in Dominica announced that they were ceasing operations from 1:00 pm today (September 3) until further notice.
“The members have engaged the Ministry of Trade since July 23, 2021 in an effort to avoid the collapse of this critical industry,” a statement from the Association said. “We further notified the Ministry of Trade on August 24, 2021 that our collapse was imminent and being an industry which is fully controlled and regulated by the Government, that intervention was critical and should be done with a matter of urgency.”
The fuel retailers cited the Ministry of Trade’s inability to provide a timeframe for the resolution of the issue and the failure of the government to honour a 2014 agreement to hold yearly reviews with the Retailers Association,
“The members have weathered significant financial strain since, and especially from the beginning of this pandemic, with fuel volumes depressed, costs increasing and margins controlled by the government, immovable,” the retailers declared in their statement.
And while they believe that “it was imperative that the minimum wage be raised for persons to be able to have a decent standard of living,” the retailers contend that the entire impact of the wage hike on the productive sectors needed to be analyzed with a view to determining how they could be mitigated and remedied. They maintain that the impact is particularly acute in the fuel sector where margins are very low.
“The fuel retailers of Dominica can no longer sustain their operations, pay their workers and secure their stations without a clear process of recovering those costs through their operations which is entirely government mandated, in price, profit, operations, safety, human resource and security costs. We stand ready to continue to serve the public once we are able to do so cost effectively,” the Association stated in its release.
The issue gained public attention earlier this month, when the contents of a letter dated August 16, 2021, sent to members of staff of Rubis West Indies Limited Dominica informing them of the company’s decision to implement lay-offs for three months effective September 16, 2021, was published in the media.
The company attributed its decision to a loss of earnings “for nearly five years” and said it was awaiting word from the Government which could affect the company’s future on the island.
But on August 27, Prime Minister Roosevelt Skerrit, while speaking on the status of the negotiation between his government and Rubis, was adamant that his government would not give in to what he referred to as ‘extortionist approaches’ from Rubis and made it clear that the Dominica Treasury would import petroleum if Rubis leaves the country.
He argued against the $1.76 more per gallon on the price of petrol which he said Rubis is requesting, pointing out that given the price build-up mechanism that determines the wholesale price and the final price at the pump, his government is not paying the company less than what they pay for the gasoline, as they allege in a letter they had written to the government.
Skerrit said the government had made a “good faith” offer to increase the in-transit fee as well an additional increase of 0.23 cents while awaiting the audited statement from the company.
Dominica News Online (DNO) confirmed today that at least six of the nine service stations operated by Rubis West Indies Limited Dominica and one other provider had ceased operations and had indicated that they will not reopen until their demands are met by the government.
Noting their frustration, one of the managers of a Rubis gas station told DNO, “We’re operating at a loss and it’s very unfair that the PM would come on the radio and say what he said, it’s a clear indication that he doesn’t value our service, and if that’s the case, we shall shut down until something is done.”
Another pointed to the recent increase of the minimum wage which took effect on September 1, 2021, but says that the industry continues to suffer while the government reaps all of the benefits.
“We are taking a stand for the reconstruction of the industry. We are saying that too much is being taken away from us; we need a fair share of the ratio of investments,” another Rubis retailer stated.
When asked how long they plan to remain closed, the gas station operator responded, “Well that’s primarily up to the government of Dominica. This is a matter for the authorities to decide whether the industry or our concerns means anything to them.”
DNO also contacted the management of Rubis who claimed to be unaware of any action being taken by the service stations.
Meanwhile, other petroleum stations such as Mcmillian Service station located at Castle Comfort and West Indies Oil and the National Petroleum (NP) both located at Canefield, remain open and staff members assured DNO that they will be open during the stipulated hours over the weekend.
Leader of the opposition United Workers Party (UWP), Lennox Linton, recently called for a fair and just margin from the petrol price to the private operators and proposed a reduction in the tax burden on the industry from $3.25 to $2.65 per gallon.
He further recommended that the government split the yield of 60 cents evenly between the petroleum importers and retailers to move the distribution margin from 67 cents to 97 cents per gallon and the retail margin from 70 cents to $1 per gallon.