19 Jan 2007By Hassan
Radio Free Asia
Translated from Khmer by Heng Soy
Oil helps the everyday human living conditions, it is used to fuel mechanical engines, electricity generators, etc… Because of the importance of oil, oil price increase or drop significantly affects the living condition of people.
In the US, the increase of oil price could cause some politicians to lose their votes during the election. Sam Rainsy, the former Minister of Economy and Finance, talked to Hassan during an interview about factors which could not lower the price of gasoline, unlike other countries.
Hassan (RFA): I want to ask you, Mr. President, according to your experience, and in your previous position as Minister of Economy and Finance, what are the main factors preventing the price of gasoline from lowering in Cambodia?
Sam Rainsy (SR): It’s because of the retailing distribution companies in Cambodia, they have thick backing and the owners of these companies are people who are close to, or are related to the top leader of Cambodia. Even though the price of oil on the international market drop, the price of retail gasoline in Cambodia still remains almost the same as before. This means that these companies are making huge profits in comparison to other companies in neighboring countries.
RFA: Who are these companies, can you name them?
SR: There are two major companies in Cambodia: Sokimex and Tela.
RFA: Do government leaders have interest in these companies or not?
SR: Either that or they are people who are close to [government leaders], they are oknhas and large capitalists who have decade-long business ties with the current [government] rulers, this is for Sokimex. For the other company, Tela, the owners are all family members of the [government] ruler of Cambodia.
RFA: Based on your understanding, does oil imported into Cambodia come directly from the Middle East or oil producing countries, or is it imported from neighboring countries?
SR: Through neighboring countries, such as Singapore and Vietnam because in our country, we don’t have refineries yet.
RFA: Does this mean that fuel imported into Cambodia is already refined? Then the price has to be higher than raw oil, no?
SR: It’s higher [than raw oil price] but nevertheless, the retail price includes both the raw material cost, the refinery cost, and the transportation cost. In every countriy, such as the US, France, Thailand, Vietnam, in the past 6 months, from mid-2006 to the beginning of 2007, the price of oil has dropped by 35% on the international market. 6 months ago, the price of an oil barrel is $78, there are 159 liters in a barrel, now it only $51 per barrel, this is a 35% price drop.
If we compare the movement of raw oil price with the movement of retail gasoline price, in our neighboring countries, the price has dropped between 20 to 25%, but in Cambodia, the price remains the same, the price drop is very minimal. In comparison to the international oil price, the fair retail price of gasoline should be between 3,000 and 3,200 riels per liter only (~$0.75 to ~$0.80) not the current 4,000 riels per liter ($1).
RFA: You just said that in neighboring countries, such as Thailand and Vietnam, they have lowered the price of oil in their countries according to the international market price, about 20% right?
SR: That’s right, in Thailand and in Vietnam, the retail price of gasoline is not even 3,000 riels per liter. In Thailand, right now, it’s about 25 bath per liter, in Cambodian riels, it’s about 2,900 riels per liter. In Cambodia, the price is 3,900 riels per liter, it’s a difference of 1,000 riels per liter. In Vietnam the situation is the same [as in Thailand], in the US, it’s even lower, I asked someone in the US, I was told that the price is about $2.21 per US gallon, and there’s 3.8 liters in a US gallon. Therefore, the retail price of gasoline in the US is only $0.58 per liter, or about 2,400 riels.
RFA: Another issue is the fact that there are reports which said that telecommunication companies, oil companies have signed agreements to provide [services to] the government cars, departments, etc… and that the government still owes these companies. Therefore, these oil companies have to maintain the price of gasoline high in order to make a profit because the government owe them, otherwise they would lose money and become bankrupt, right?
SR: That’s not right, we cannot mix issues without transparency, the arguments [you mentioned about] are turning people into victims. [In fact, the oil companies] fix the price the way they want it, there is no competition, it’s a monopoly. Just like right now, every liter of gasoline bought is like paying a tax to these companies, however, this tax money does not go to rebuild the country, it simply goes into the pocket of the oil company owners, 1,000 riels [per liter of gasoline] is a lot of money, it’s the price of one kilogram of rice. Every time we buy one liter of gasoline, it’s like taking the food out of our mouth. If we keep 1,000 riels, we can buy one kilogram of rice and it can feed at least two persons for one day.
In the US, the increase of oil price could cause some politicians to lose their votes during the election. Sam Rainsy, the former Minister of Economy and Finance, talked to Hassan during an interview about factors which could not lower the price of gasoline, unlike other countries.
Hassan (RFA): I want to ask you, Mr. President, according to your experience, and in your previous position as Minister of Economy and Finance, what are the main factors preventing the price of gasoline from lowering in Cambodia?
Sam Rainsy (SR): It’s because of the retailing distribution companies in Cambodia, they have thick backing and the owners of these companies are people who are close to, or are related to the top leader of Cambodia. Even though the price of oil on the international market drop, the price of retail gasoline in Cambodia still remains almost the same as before. This means that these companies are making huge profits in comparison to other companies in neighboring countries.
RFA: Who are these companies, can you name them?
SR: There are two major companies in Cambodia: Sokimex and Tela.
RFA: Do government leaders have interest in these companies or not?
SR: Either that or they are people who are close to [government leaders], they are oknhas and large capitalists who have decade-long business ties with the current [government] rulers, this is for Sokimex. For the other company, Tela, the owners are all family members of the [government] ruler of Cambodia.
RFA: Based on your understanding, does oil imported into Cambodia come directly from the Middle East or oil producing countries, or is it imported from neighboring countries?
SR: Through neighboring countries, such as Singapore and Vietnam because in our country, we don’t have refineries yet.
RFA: Does this mean that fuel imported into Cambodia is already refined? Then the price has to be higher than raw oil, no?
SR: It’s higher [than raw oil price] but nevertheless, the retail price includes both the raw material cost, the refinery cost, and the transportation cost. In every countriy, such as the US, France, Thailand, Vietnam, in the past 6 months, from mid-2006 to the beginning of 2007, the price of oil has dropped by 35% on the international market. 6 months ago, the price of an oil barrel is $78, there are 159 liters in a barrel, now it only $51 per barrel, this is a 35% price drop.
If we compare the movement of raw oil price with the movement of retail gasoline price, in our neighboring countries, the price has dropped between 20 to 25%, but in Cambodia, the price remains the same, the price drop is very minimal. In comparison to the international oil price, the fair retail price of gasoline should be between 3,000 and 3,200 riels per liter only (~$0.75 to ~$0.80) not the current 4,000 riels per liter ($1).
RFA: You just said that in neighboring countries, such as Thailand and Vietnam, they have lowered the price of oil in their countries according to the international market price, about 20% right?
SR: That’s right, in Thailand and in Vietnam, the retail price of gasoline is not even 3,000 riels per liter. In Thailand, right now, it’s about 25 bath per liter, in Cambodian riels, it’s about 2,900 riels per liter. In Cambodia, the price is 3,900 riels per liter, it’s a difference of 1,000 riels per liter. In Vietnam the situation is the same [as in Thailand], in the US, it’s even lower, I asked someone in the US, I was told that the price is about $2.21 per US gallon, and there’s 3.8 liters in a US gallon. Therefore, the retail price of gasoline in the US is only $0.58 per liter, or about 2,400 riels.
RFA: Another issue is the fact that there are reports which said that telecommunication companies, oil companies have signed agreements to provide [services to] the government cars, departments, etc… and that the government still owes these companies. Therefore, these oil companies have to maintain the price of gasoline high in order to make a profit because the government owe them, otherwise they would lose money and become bankrupt, right?
SR: That’s not right, we cannot mix issues without transparency, the arguments [you mentioned about] are turning people into victims. [In fact, the oil companies] fix the price the way they want it, there is no competition, it’s a monopoly. Just like right now, every liter of gasoline bought is like paying a tax to these companies, however, this tax money does not go to rebuild the country, it simply goes into the pocket of the oil company owners, 1,000 riels [per liter of gasoline] is a lot of money, it’s the price of one kilogram of rice. Every time we buy one liter of gasoline, it’s like taking the food out of our mouth. If we keep 1,000 riels, we can buy one kilogram of rice and it can feed at least two persons for one day.
4 comments:
In Thailand and Vietnam, the government maintains a subsidy policy that keeps the retail price fairly low and stable.
In Cambodia, there is an oil cartel that keeps the price high for sharing with high ranking government officials.
If only oppositions are effective in Cambodia...
SiS
VIVA SRP!!!!!
AH ME SVA LEU LEU AND AH POUK SEK KMEAN SROK AND KMEAN VONG
GO SRP GO!!!!!!!!!!
What is a bunch of pro-polluters?
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