IMF recommends end to fuel subsidy
By Stephen TADAHA with additional information from Ecomatin
The International Monetary Fund (IMF) is urging Cameroon to permanently eliminate fuel subsidies, despite two successive increases in pump prices. Faced with this pressure, the government, although hesitant, could be forced to abandon subsidies in 2025, to ensure the sustainability of its public finances, Ecomatin has reported.
A delegation from the International Monetary Fund (IMF) led by Cemile Sancak is in Cameroon from October 3 to 16, 2024 as part of the 7th review of the Economic and Financial Program supported by the Extended Credit Facility (ECF) and the Extended Credit Mechanism (ECM). At the end of an audience with the Minister Delegate to the Minister of Finance, Yaouba Abdoulaye, the IMF emissary gave an overview of the issues that will arise in this other phase of the program initiated with the Cameroonian government since July 2021.
At the same time, the question of subsidising fuel prices was again raised. On this subject, Cemile Sancak certainly welcomed the government’s efforts to raise prices at the pump twice, but all the objectives set from the start have not yet been achieved.
“There are several successes of the program. Some reforms remain to achieve the overall objectives of the program. Concerning pump prices, the authorities have reduced the majority of the subsidy. So, there have been two price increases at the pump and now the remaining subsidy is much reduced. Indeed, in the program, we defined the elimination of subsidies,” she clarified.
Between February 2023 and February 2024, the government approved two price increases for certain petroleum products. The first was in February 2023 and the second a year later. The price of a liter of gasoline increased from FCFA 630 on January 31, 2023, to FCFA 840 on February 2, 2024, an increase of FCAF 210, (+33.3%) in the space of one year while a liter of diesel costs 828 Fcfa at the pump since February 3, 2024, compared to 575 Fcfa until January 31, 2023, then 720 Fcfa from the next day.
The prices of gas FCFA 6,500 and kerosene FCFA 350 remained unchanged.
The elimination of subsidies of fuel will therefore mean another increase in the price of fuel shortly.
