In Brazil, the government introduced changes in the methodology for calculating the tax on the circulation of goods and services (ICMS) on fuels and a project for the creation of a stabilization fund will be debated in Congress.
The decision was made after last March 10 Petrobras, in compliance with its price policy based on international price parity, announced an increase of 18.8% in the refinery price of gasoline, from 24.9% of the diesel and 16% of liquefied petroleum gas (LPG).
In Chile, meanwhile, the Boric government sent a bill to double the resources of the Fuel Price Stabilization Mechanism (MEPCO) that was approved by Congress.
Increases in food prices
The rise in fuel prices is a factor that puts pressure on inflation, but the most direct impact on the daily lives of millions of people in South America is due to the increase in food prices, even more so after the severe effects caused by the pandemic that they still persist.
The prevalence of severe food insecurity in Latin America and the Caribbean increased 4 percentage points between 2019 and 2020, reaching 14.2% in 2020, that is, some 92.8 million people, according to data from the Economic Commission for Latin America and the Caribbean (ECLAC).