HCM CITY — Taxi and bus operators in HCM City increased fares and the prices of many consumer goods rose soon after fuel companies hiked petrol prices by VND1,100 per litre on Monday.
A92, the most popular variety of petrol, now costs VND23,000.
Ta Long Hy, chairman of the HCM City Taxi Association, said the increase in petrol prices had forced taxi companies to raise fares by around VND500 per kilometre.
Ho Huy, the director of Mai Linh Taxi Company, one of the city's two largest, said his company too was considering a VND500-1,000 hike.
Any increase – or decrease – in fares goes beyond just the fuel price change; it also involves massive expenditure for getting authorities' approval and changing the meter in each taxi. Vietnamnet quoted Vinasun, the other big operator, as claiming it costs VND260,000 to change the meter in each of its 4,500 vehicles.
Members of the city Transportation Association also want to increase fares, saying after the two latest hikes, petrol prices have gone up by VND1,900 per litre. He was referring to a VND800 hike less than a fortnight earlier.
Truong Minh The, a driver for the Transportation Co-operative No 14, said his company had a contract to carry students to school at VND230,000 (US$11) per month each.
The rate had been maintained for a long time, but now it has to be hiked to VND250,000 ($12), he said.
Diep Anh Tuan, director of the Loc Phu Trade and Service Company Ltd, which offers cargo services, said his compay has not decided about any increase in tariffs.
"We are still waiting for other companies in the market and our partners.
"However, we will ensure that the increase is less than the hike in petrol prices. We estimate it will be 5 per cent."
Prices in most retail markets around the city have also shown signs of rising.
A retailer in Binh Dien Market in District 8 said the prices of some vegetables and fish had increased by more than 10 per cent. Pork prices have shot up by up to 40 per cent.
In Hoc Mon District, a pork seller at a wholesale market said, pork prices have been up by 10 per cent in the last few days.
He blamed it on the hike in petrol prices.
Economist Le Dang Doanh, urged the Government to reduce import tax on fuel to share the burden with the people because the rising costs would directly affect the prices of many products.
Policy makers also need to carefully consider the timing of petrol price hikes because if they increase prices during a recession, consumers would further reduce consumption, causing even higher inventories and slowing production, he added.
Oil companies blamed the price increase on the interruption of production at Dung Quat, the country's sole oil refinery, due to a technical problem and an increase in global oil prices in the last 10 days. — VNS