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(business in cameroon) - in a letter sent on may 15, 2023 to its customers, gaz du cameroun (gdc), which supplies natural gas to around thirty industrial companies in the city of douala, the country's economic capital, announces a 20% increase in its prices, starting june 1, 2023. the cameroonian subsidiary of the british victoria oil & gas (vog) explains this “first price increase in 10 years ” by “ the significant increase in its operating costs », because of the global situation.
the rather significant increase in the prices of natural gas intended to supply the main production plants of the economic capital of cameroon comes after the extension to natural gas of the special tax on petroleum products (tspp). contained in the 2023 finance law of the state of cameroon, this extension has since january 2023 required companies that consume industrial gas to pay the tax authorities a tax of 70 fcfa for each cubic meter of gas consumed.
at the same time, since january 2023, the electricity sector regulatory agency (****l) has also increased electricity prices by nearly 30% for "key account" customers, a term that includes industrial companies reputed to be energy-intensive. to this must be added the increase since february 2023 in the prices of super, diesel and kerosene used by manufacturers. on these energy sources, the proportion of the price increase varies between 15.8% and 36.5%.
russian-ukrainian conflict
the explosion of energy costs in the industrial sector in cameroon since the beginning of 2023 should result in a much greater increase in production costs for companies. indeed, since the post-covid period, aggravated by the outbreak of war between russia and ukraine in february 2022, these companies have already seen the ex-factory prices of their products experience significant increases, due to the skyrocketing prices for sea freight and raw materials on the international market.
indeed, according to the industrial producer price index (ippi) published by the national institute of statistics (ins), production costs in industrial companies in cameroon in 2022 experienced the largest increase in 6 years. , reaching 13.3% year-on-year. according to ins data, two main sectors of activity are particularly affected by this increase in production costs.
these are the extractive sector, in particular the oil and gas industry, and the steel and metallurgy sector. in these two branches of activity, ex-factory prices increased by 29% and 16.9% respectively during 2022. against only 5.8% in the chemical, pharmaceutical and plastics industry; 1.9% in the textile industry; 10.9% in the food industry and 15.9% in the leather industry.
price approval
this increase in production costs in industrial companies has resulted in an increase in final consumer prices for households. “ in the same wake, we noted a significant increase in final consumer prices for households of 6.3% in 2022 (i.e. more than doub