About 1.02 billion Ghana cedis is expected to be spent on fuel subsidies by government this year.

This is irrespective of the removal of subsidies on petrol, diesel and LPG a couple of weeks ago.

Last year, government spent 809 million Ghana Cedis on fuel subsidies, about 0.5 percent of GDP.

According to the Bank of Ghana, the total out turn of petroleum subsidies last year represent 33 percent of total domestic financed capital expenditure.

Head of Research at the Central Bank, Madam Grace Akrofi, says the gradual increase in fuel prices will not have a significant effect on inflation.

She disclosed this to XYZ BUSINESS at a media seminar organized by the Institute of Financial and Economic Journalists as well as the African Business Media.

Meanwhile, civil society group, ISODEC has reiterated its earlier assertion that fuel subsidies must not be removed.

Though it agrees that the present fuel price subsidy policy is inefficient, it believes it must continue.