IT TURNS OUT OTHER COUNTRIES ARE FOLLOWING IN CAMEROON'S PATH

Yesterday, we reported that the Cameroonnian government had announced bold new cuts on oil subsidies which had pushed up the price of fuel by 14% and 15% for diesel and petrol respectively. And we also reported that there was a planned strike action by the Cameroon Taxi Drivers Union. We can now confirm that the strike is scheduled for Monday (assuming the whether would permit it).
 It turns out Cameroon is not the only country struggling with the oil subsidies dilemma.

Egypt, under the guidance of the newly elected president Sissi has just cut oil subsidies, a move that sees the price of oil go up by up to 78%. The cuts take effect from midnight.
The price of 92-octane petrol would be 2.60 Egyptian pounds (21p) a litre, up 40% from its current price of 1.85 pounds, while 80-octane petrol would rise to 1.60 pounds a litre, up 78%.
Diesel will rise to 1.80 pounds a litre, an increase of 63%, while the less commonly used natural gas for vehicles will rise by 175% to 1.10 pounds a cubic metre.


It turns out Camerron is not the only country struggling with the 'oil subsidy dilemma'. It has recently been reported that the new Indian Government led by the newly elcted Narendra Modi is expected to cut gradually cut oil subsidies over the next few years. Moody's Investor Service reports that these measures are necessary to improve the credit worthiness of India's oil marketing companies.

Currently, there is an intense debate in the Indian Parliament with regards to the new proposal to cut fuel subsidies. On one hand, the newly elected government fears it could infuriate the general public that just put it into power, and on the other hand, it seeks to better India's budget, improve it's credit rating and better it's Balance of Payment situation.

 In case you still have not noticed what these two countries have in common, let's inform you - they both have very new governments, in the case of Egypt, less than a month old, while Indi's government has been in power barely a month.

So why would a very young government adopt such a controversial and potentially dangerous move? Well for the case of Egypt, food and oil subsidies traditionally consume a quarter of the state budget, but the government is now taking steps to significantly reduce that inorder to revive the country's crippling and budhet deficit budget deficit which has come as a result of 3 years of civil unrest.
However, the mere fact that such a serious law is being passed is a clear sign that there's now a serious person in control.

As for India, it still remains to be seen if this law will be passed. But if it is indeed passed, it will be as a result of the sluggish growth of recent years that has led to a huge Balance of Payments deficit. 

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