Fuel prices hit chaotic West African travel

DAKAR (Reuters) - Chaotic transport is a part of life in West Africa, but getting to work has become even harder as rocketing fuel prices ignite protests by bus and taxi drivers, squeeze family budgets and encourage fuel smuggling.

Passenger buses are parked at the terminal Patte D'Oie in the Senegal's capital Dakar July 16, 2008. Chaotic transport is part of life in West Africa, but getting to work may become even harder with skyrocketing fuel prices. REUTERS/Normand Blouin

Global oil prices doubled in the past year and continued to rise strongly in 2008, hitting hard those who earn a living on the roads of some of the world’s poorest countries.

This has fuelled social unrest in some fragile countries whose governments do not have the means to indefinitely soak up the higher fuel prices with subsidies.

Battered taxis and colourful minibuses with smashed lights and cracked windscreens are a common sight in West Africa, where most people rely on them to get around. But their drivers say soaring fuel prices have swallowed all their profits.

“We work only to pay for the fuel, we are not making money,” Moussa, who has been a taxi driver in Senegal’s capital Dakar for seven years, said as he stopped to fill his tank.

The price of diesel here has risen by a quarter since the start of the year to 813 CFA francs per litre, but taxi drivers find it hard to pass on the higher costs.

“We ask for more, but clients cannot give us more because they have no money,” said Moussa, who declined to give his last name.

High fuel prices have triggered some strikes already and prompted threats of more.

Birame Faye, a young minibus driver in Dakar, said drivers’ meagre revenues had fallen by more than a third.

Minibus drivers have to pay for the fuel out of the day’s earnings, he said, while government-fixed fares have remained steady for the passengers who cram inside in the summer heat.

“We want the government to increase the fares so that we can feed ourselves,” Faye said, adding that drivers might go on strike if that did not happen.

Many West African governments have tried to cushion the effects of price hikes on consumers by reducing taxes and levies on food imports and bolstering subsidies for essential items, like rice and fuel.

But subsidies weigh heavily on governments’ budgets and some countries, like Ivory Coast and Burkina Faso, have now moved to increase fuel prices to reflect, at least partly, higher oil prices. That has, in turn, sparked more protests.


Ivory Coast’s economic capital Abidjan was paralysed by a transport strike in July after the government decided to raise gasoline and diesel prices by 29 and 44 percent respectively.

Police used teargas to disperse dozens of youths who set up roadblocks, before the government agreed to reduce the diesel price increase and halve ministerial salaries.

Cocoa exports from the world’s number one producer of the bean used to make chocolate were not badly affected as the strike was staged during a seasonal lull.

And some of those stranded by the strike were sympathetic.

“We all agree with the strike because life has become too expensive,” Patricia Camara, a secretary at an insurance company in Abidjan’s downtown business area said.

“Everything is getting expensive in Abidjan but our salaries do not rise,” she said as she waited for a cab to get home.

Even in Nigeria, the world’s eighth largest crude oil exporter, surging oil prices prompted thousands of gasoline truck drivers to go on strike early in July.

Long lines formed at gasoline stations in the capital Abuja, the commercial hub Lagos and other cities as drivers sought to fill their tanks, fearing the strike would disrupt supplies.

Diesel prices have risen 110 percent in the past few months to around 170 naira per litre. As in Ivory Coast, unions suspended their strike after Nigeria’s government pledged to further subsidise diesel prices.

Higher transport costs ripple across the region’s economies.

“We can’t even eat well, and now the cost of transport is increasing,” said Ivorian insurance broker Benjamin Kouakou. “This is killing us because when transport prices rise, everything becomes more expensive.”

Lisa Borgatti, from the United Nations Conference on Trade And Development (UNCTAD), said last month that the impact of rising oil prices on poor economies would be “terrible.”

“In terms of the impact on the price of transportation, it means the price of goods imported and exported increases, and many of the goods imported are primarily food-related, so that’s an extra cost, especially to the poor,” she said in Dakar.


However, in some West African countries, people say there is not much point in striking because the problem is a global one.

Mbaye Gue, a Senegalese taxi driver in the business since the 1970s, smiles when asked if he expects a strike in Dakar.

“Everything increases, our profit decreases, it’s exhausting. But this is happening worldwide, we can’t do anything about it,” he said.

This resignation may be good news for governments struggling to maintain subsidies that many analysts say are unsustainable.

Landlocked Burkina Faso raised fuel prices in July by 6.5 to 15 percent, depending on the type of fuel, after a six-month freeze during which oil company SONABHY said it lost more than $40 million.

“The government became aware that it had become impossible for SONABHY to continue working if the price freeze was maintained,” the firm’s Director General Hubert Yameogo said.

Subsidies have also encouraged smuggling.

In Sierra Leone, where the price of fuel has gone from 13,000 to 16,500 Leones a gallon in less than a year, subsidies are nonetheless keeping prices lower than in neighbouring states.

“We have seen successful attempts at smuggling on the increase. In Guinea-Conakry, I understand it’s 27,000 Leones a gallon, so fuel ... is smuggled out,” Trade, Industry and State Enterprises Minister Alimamy Koroma told Reuters.