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Transportation Strike Really OverSubmitted by fyl on 17 May, 2008 - 08:08.
This time it is real. There are an assortment of fuel price concessions for transportistas and the strike is over. I carefully listened to all the numbers but was out in the yard working and, well, have forgot them. I remember one was a reduction in the price of some fuel of $1.30/gallon but don't remember whether it was gas or diesel. During the strike, I am sure Managua was a mess and long-distance transport clearly was as well. But, there seemed to be zero effect in Estelí. The Urbanos and taxis didn't go out on strike and I noticed no shortages in the stores. Our only issue was needing a load (550 bags) of cement. We sent our (rented) truck and driver to Managua in the evening and he returned the next morning with that truckload. ( categories: )
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Comandante Robin Hood
It is my understanding in reading Nicaragua's papers that the agreement covers buses & taxis, passenger transport, but not truckers (not cargo). Truckers will sit down to negotiate with the government on Monday. Whether they are still out on strike was unclear to me.
The language of the agreement is beautiful, I quote, "EL PRESIDENTE DE LA REPUBLICA DE NICARAGUA, COMANDANTE DANIEL ORTEGA SAAVEDRA, EN EL MARCO DEL ESPIRITU DE LA ALTERNATIVA BOLIVARIANA PARA LAS AMERICAS (ALBA), ANTE LA CRISIS ECONOMICA MUNDIAL ... RATIFICA Y AMPLIA LOS COMPROMISOS ORIENTADOS AL SECTOR TRANSPORTE DE PASAJEROS URBANO, INTERURBANO Y ACUATICO."
* cooperative owners get tires, batteries, etc. at cost, with 2 years to repay at no more than 8%, plus 750 BARRAS ELECTRONICAS for city buses (http://barraselectronicas.com/)
* import & finance 3,000 kits to transform taxis from gasoline to LP-gas (propane)
* the discount for gasoline & diesel fuels will be $1.00 in addition to the $0.30 per gallon already promised in the ALBA program. This means, at this moment, for passenger transport, diesel costs $3.15 per gal in Nicaragua, the cheapest in Central America.
* The distribution of discounted fuel is now available in all provinces at 61 stations through Petronic and some Shell
The language separating the $1.30 discount into $0.30 from ALBA plus another $1.00, led some to ask, from where will this other dollar come? Well, Ortega announced price increase of fuel the day after the agreement was inked: gasoline, regular & super, and diesel will cost, respectively, C$100.91, 102.41 & 98.26 córdovas per gallon (or $5.24, 5.32 & 5.11/gal) (La Prensa 5/17/08). (A Honduran wrote in a comment to the paper that their prices are C$64, 78 & 69 per gallon (or $3.33, 4.05 & 3.58) because of government subsidies.)
So the plan is simple, take from the rich (driving SUVs) and give to the poor (using public transportation). I cannot disagree with it, assuming the truckers get a similar break, so the cost of basic goods don't rise too much. As it is chickens usually come to market in a bus, with veggies in bags & baskets strapped on top. So maybe that's covered.
Strike is Over
And the price reduction of $1.30 applies to diesel.
Reported in today's La Prensa.
Don't know the exact math
but at the same time he gave the strikers a price break, he raised the price for everyone. Bet the government did not end up a looser Dan Polley
Price reduction
Price reduction is for commercial trucks and taxis, everyone else will pay over $100 Cordobas per gal. of gasoline.
Reported in today's La Prensa
Al
Doesn't sound bad
I think you are right but I don't think this is a bad thing. First, public transport is more efficient. That is, it uses less fuel per passenger mile and also less wear and tear on roads and other infrastructure. So, encouraging the use of public transport is a good thing.
Beyond that, those businesses (for lack of a better word) that have been affected the most by rising prices of fuel are not the ones that own private vehicles. They are, for example, the farmers who transport their goods to market on the roof of buses. Not increasing their cost to transport the goods means lower prices in the markets.
Like Ortega or not, Nicaragua is one of many countries suffering from increased fuel costs. Nicaragua's energy needs are very small (in total and per capita) than most countries so, to a certain extent, they are victim to other countries over-use of fuel. There is no easy way for a small player to solve their own problems. Ortega is, at least, trying to address the problem.
I agree public transport
is a good thing, but do you really think Ortega raised the price of fuel to benefit the masses? Dan Polley
Motives
Your question is a lot like asking the same of, for example, Bush's war in Iraq. I don't know Ortega's motives but it does seem that his decision will actually benefit people. Let's settle for that right now.
His offer was clearly forced by the people. That, to me, sounds like democracy. In spite of the typical U.S. press that suggests there is a revolution each year in each Latin American country, things feel pretty stable in every place I have been/know of. Just different in the way changes take place.
Public Transportation
Hola Fyl,
You are right, for the reasons you just explained(and others), public transportation needs to be encourged.
If the public/commercial transport was safe, dependable and half decent, everything would be OK.
The Govt is failing to enforce the traffic/transit rules, where the officers at the safety inspections posts along the highways and city streets would stop the newer and safer vehicles for a full safety inspection, while allowing the old and decrepited vehicles to pass without any inspection.
Al
I'm installing some
of these pretty red and white plates on my truck :).
I was wondering about that
That is, what will qualify as "commercial transport". In Costa Rica, you see all sorts of vans with TURISMO banners on the windshield. A lot of time they are just filled with a family taking th kids to school and such. Not sure what the benefits are.
We just bought a vehicle for the Geek Ranch to transport our customers. It will be used for airport runs and to do trips to town and day trips for our customers. Could that qualify? (I don't expect it will get a lot of miles and am not particularly concerned about the fuel cost here—just wondering what the rules are and how people will bend them.
quick thinking
Interesting idea. We do the same with our vehicle (pick clients up and use the truck for day excursions.) How would one "qualify" for the Passenger Use exemption? Do you know? Stacy & Mike
Some Taxi drivers
told me that there will be one special pump in select gas stations.
In Rivas: Shell, Esso, Petronic. Since I have always fueled at the truck pumps anyway I imagine that they will continue to sell to me from these pumps. We'll see.
If they don't, no big deal.
Taxis have the 'license' to steal
At $3.15 for taxis and trucks and $5.15 for the rest of us there will be a black market starting very soon.
It is very easy to syphon diesel from a truck and just as easy to miss it. Don't know yet what kind of records they will keep so if you have a taxi and show up 3 times in one day to purchase that may itself raise suspicion. I think truckers, even the companies, and taxis will start selling to friends and such.
Another way is to have a friend who runs a station sell you on the side after hours. Many of these stations are manned by scammers already so this may be a new opportunity to repurpose their behavior to a new income stream.
Even at the lowest level there will be crooks who will start stealing gas from cars and hoarding it somewhere in a 55 gallon drum probably in the back yard. Watch the news in the next months for this type of accident as this is very dangerous practice.
Some taxi drivers will no doubt skim for friends and family. Buy gas at cheap price and sell (xfer) to family or friends for their own private use. If a taxi will be able to go to 10 different filling stations in one day and fill up at all of them this will be one hell of a business.
Curious to see how the government will monitor this. Perhaps they will record the mileage of the taxi or issue some sort of ID card. Taxi drivers do a noble profession and if they can skim a little and make an extra $75.00 to $100.00 a month to help feed their kids they may do it.
One idea
One idea I thought of would be for transport vehicles to pay regular price and then get the rebate when they paid their IVA. This would mean two things:
As not paying taxes is a great Nicaraguan pastime, this might actually offer some motivation to pay them.
Guaranteed Audit
For the reasons you mentioned in your post (general non payment of taxes). The Nicaraguan government never, ever, ever, voluntarily writes tax rebate checks.
They will give you credits, like the IR credits abused and sold by Byron Jerez in the Aleman administration and the commonly applled IVA credits to merchants when they make large capital investments but they would send in an audit team and review everything before they write you a check. Then after the audit they will try to negotiate a credit.