Louis-Marie Kakdeu

Cameroon: The increase in fuel prices is a plot against the populations


This Tuesday, January 31, 2023, the method of governance by ambush was used by the government to increase the prices at the pump of fuel.

An increase which generally revolves around 21% (super and diesel) as prescribed by the IMF. An increase which was accompanied by two insignificant and inappropriate social measures, namely: 5,2% salary increase and approximately 11% proposed increase in the minimum wage.

I believe that the Cameroonian government has definitely gone into the bush and that the following clarifications deserve to be put in the public square to enlighten the public:

I would first like to deconstruct the argument that the country had no choice. The price structure at the pump published by the CSPH for the period from January 1 to 31, 2023 clearly indicates that the Cameroonian government adds to the price of a liter of fuel more than twenty taxes and other related rights which far exceed the state support which stood at 133,72 FCFA. This means that by simply reducing 2 taxes out of 26, namely the special tax (110 FCFA) and customs duties (24,39 FCFA), the government would no longer have needed to subsidize anything and therefore, to raise prices. This is just common sense reasoning. The question that has never been answered is why should we overtax fuel so much and pretend to subsidize at the same time. It is an economically curious reasoning.

Let's go into detail: the price of a liter of imported Super was 341,75 FCFA last month. Its cost price was 472,08 FCFA because the government had added 130,33 FCFA in taxes. At this price including VAT entry SCDP depot Douala-Bonabéri, the government had added 218,43 FCFA of various taxes before it was put on the market. The total taxes added by the government were therefore 348,76 FCFA while the state support was only 133,72 FCFA. I want to understand where the grant was. I can clearly see that what remains in the public treasury is a surplus. There is worse. After all tax operations, the price including tax of a liter of SCDP Super outlet from Douala-Bonabéri was 556,79 FCFA in January 2023. To this, the government had added 52,06 FCFA for overheads, financial costs, sinking, profit, depreciation and maintenance, city delivery, VAT on city delivery. We may well wonder why we could not act on overheads, for example, to limit costs. Worse still, the government had added the VAT on distribution which amounted to 5,75 FCFA. All that escaped the State was the dealer's margin, which was 16 FCFA. We therefore understand that there were many levers on which the government could act to refrain from any increase in prices at the pump. If the decision was pro-Cameroonian of course!

The real reason for the government's stubbornness is the presence of the IMF, which is the debt watchdog. The government does not increase prices because the weight of the subsidy is unsustainable as announced. It increases because it is necessary to pay the debts of the State. And it is the poor taxpayer who will pay for the country's heritage management. Cameroon's debt has gone from about 800 billion to more than 12 billion FCFA in about ten years. The question may be to know what this indebtedness was used for. The answer is that the government has not made productive investments as required. For example, it has financed companies that have gone bankrupt for electoral and patronage reasons. The IMF therefore sets performance targets from this year onwards for these public companies which are weighing down the country's finances because the government maintains at their head the caciques of the regime who manage them with village logic. We are therefore paying the price for bad governance.

The social measures announced are insufficient because they will not cover the increase in production costs and the increase in transport costs that will follow. It will be necessary to expect the strike of the carriers, in particular of the taxis, which will not be able to get out of it if one does not adjust the prices of the race. The 5,2% increase on salaries means that the public official who earned 100 FCFA will see an increase of 000 FCFA on his salary. What misery ! Above all, we will have to expect the mobilization of the workers' unions, which demanded a 5200% increase in wages in order to catch up with the level of 30. I repeat: in 1993, we still have not reached the level of wages that Cameroonians had 2023 years ago. What a regression! Worse, in 30, what will be the use of an SMIG of 2023 FCFA which will barely be enough to buy a bag of rice? It's a mockery! And beyond that, a provocation! A political party like the SDF, which since the 41850 presidential elections has been carrying out the project of increasing the purchasing power of Cameroonians, will have to mobilize with its social partners to push the government to go further in order to reach the level of wages. currently practiced in other African countries at the same level as Cameroon. It is simply a question of multiplying wages at least by two. It is a matter of dignity and national pride!

We will be told that there is no money: FALSE! Apart from chapters 65 and 94 which everyone knows and which can be directly put to use, the advocacy of the Honorable Joshua Osih has borne fruit. The Caisse de Dépôt et de Consignation (CDC) has just been created. It's as if the government doesn't believe it! Otherwise, why increase fuel prices and asphyxiate the populations when this single fund can immediately generate about 6000 billion FCFA for the State? I am talking about an amount equivalent to the national budget! To do this, you just have to make it functional! Why wouldn't the government make it functional? Why wouldn't the government redistribute some of this money that is currently sleeping in the pockets of a few individuals (selfish interests) to all workers (collective interest) by increasing wages?

We simply see that our government is not serious and that it is under the influence of the IMF. It's off to a bad start for 2023! The citizen will now have to be wise. Why ? Because the high cost of living business concerns everyone. Networks of creatures or clientelism no longer protect anyone! It's up to us to see!

Louis-Marie Kakdeu,
Economy, Finance & Trade.

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