Fuel Price Subsidies in Gabon: Fiscal Cost and Distributional Impact

by Daniel Leigh

This paper looks at the fiscal cost and distributional impact of implicit fuel price subsidies in Gabon, where fuel prices have remained largely unchanged since 2002. Using estimated implicit import parity prices, we evaluate the total fiscal cost of the subsidies at 3.2 percent of non-oil GDP in 2005-more than total public health expenditures. We also analyze the distribution of the subsidies using household survey data and find that the bulk of the subsidies benefit higher-income households. Finally, we suggest use of a number of existing programs to provide a more targeted and cost-effective means of protecting the real incomes of lower-income households from the effects of energy price increases.

17 pages, Kindle Edition

First published October 1, 2006

About the author

Daniel Leigh is a pseudonym, a pen name. Though the name is fiction, the words written within are true; including the personal accounts. The preeminent purpose behind Daniel Leigh Books is to move the reader into a greater understanding of God, His ways, and His plans–thereby ushering in an increasing intimacy in their relationship with Him. Daniel Leigh is a cooperative effort of like-minded individuals who have set their heart to study, to practice and to teach God's word. Our desire is not for the limelight, but to witness the fullness of Life made manifest in each person who chooses to abide in the Word of Truth.