MercoPress. South Atlantic News Agency

Abdo enacts law eliminating fuel subsidies to Paraguayan brand fuels

Petropar was yet to announce its new prices

Paraguay's President Mario Abdo Benítez Tuesday signed into law the suppression of subsidies to the price of fuel at pumps which helped the state-run Petróleos Paraguayos SA (Petropar) against all competitors.

The new law, which passed through both houses of Congress earlier this month, puts an end to the subsidy to Petropar's diesel type III and naphtha 93. It will become effective Wednesday.

Petropar will thus have to adjust its prices after selling these two types of fuels at PYG 2,500 (US$ 0.36) less than private brands, which have been demanding this change to fight off unfair competition.

According to Paraguayan media, Petropar was yet to announce its new price, as there was still uncertainty whether it would be equal to that of other companies or remain somehow below it.

As a result of the subsidy and the difference in prices, private companies took several measures in protest, such as closing service stations after midday, as well as dismissing workers due to the reduction in sales.

On the other hand, truck drivers' unions have announced a new wave of mobilizations against the elimination of the state subsidy.

Despite this ongoing crisis, President Abdo Benítez informed Congress that he would be leaving for Sao Paulo for private reasons, where he planned to stay until next Friday.

The head of state had already traveled to Sao Paulo on March 14, returning two days later. According to media reports, Abdo's mother-in-law is hospitalized in the Brazilian city and he would join the First Lady and other family members visiting her during the Easter holidays.