Fitch Solutions reports that Cameroon will not see fuel price hikes in 2025, despite significant cuts in fuel subsidies. The report emphasizes the role of the upcoming presidential election in maintaining price stability. Additionally, Finance Minister Louis Paul Motazé clarifies that reducing subsidies does not necessarily correspond to increased pump prices due to falling international market prices.
Fitch Solutions, a division of Fitch Group, has announced that there will be no increase in fuel prices in Cameroon for the year 2025, as noted in a report on the national economy released in February 2025. This stability in fuel pricing is attributed to the upcoming presidential election, which the report correlates with the government’s decisions concerning fuel subsidies.
Despite cuts in fuel subsidies occurring in February 2023 and February 2024, which resulted in higher transportation costs, Fitch Solutions does not anticipate additional reductions in subsidies for 2025. However, there is some ambiguity in the report, suggesting it may imply no further increases in fuel prices instead of a halt in subsidy reductions.
The 2025 Finance Law of Cameroon does, in fact, include a planned decrease in fuel subsidies, which are projected to fall significantly from CFA263 billion in 2024 to CFA15 billion in 2025. This change was confirmed through explanatory notes accompanying the law passed by Parliament.
Even with this notable reduction in subsidies, officials from the Cameroonian government insist that fuel prices will remain stable in 2025. Finance Minister Louis Paul Motazé clarified via social media that the reduction in subsidies does not necessarily lead to higher pump prices, as international market prices have also decreased, which mitigates the need for subsidies.
Fitch Solutions’ view coincides with prior statements by Fitch Ratings from November 2024, wherein it was mentioned that the government had increased fuel prices previously due to social stability concerns while likely avoiding further increases in 2025 due to the electoral context.
In summary, Fitch Solutions and Cameroon’s Finance Minister project that fuel prices will remain stable in 2025, despite the reduction in fuel subsidies as outlined in the 2025 Finance Law. The government’s focus on maintaining social stability in light of the upcoming presidential election plays a crucial role in this decision, highlighting a strategic approach to fuel pricing amid international market fluctuations.
Original Source: www.businessincameroon.com
