Diago-Guinness Cameroun Hub products have witnessed increases in prices of late. From April 1, 2012, Guinness, Guinness Smooth, Malt Up, Malta and others have witnessed a FCFA 50 per bottle increase in price and about FCFA 1,000 per crate. Company sources say the increases took into consideration the future of the company and the country's socio-economic development. But government has rubbished the move, qualifying it as everything but consumer-friendly.
Information from Diago-Guinness Cameroun Hub indicates that the decision to augment the prices is motivated by the increase in the prices of brewery ingredients in the international market. Given that the Cameroonian subsidiary imports all its by-products, sources say, it needed to review the prices of its finished products to stand the inflation on the international market. Also, they say the company is international and that to attract more investments, it needs to make returns.
The company reportedly looked at several possibilities of attaining this objective and finally settled on two: Increase in prices or reduction in taxes paid to the State. The former, our source said, proved the ideal given that through the increase, the company would continue to expand in the country, the additional rates by retailers would pump money into the economy and that more than 40 per cent of the profits would go into the State treasury in form of taxes. "There are over 300,000 retailers and when you give them more money, you are in other words pumping money into the economy," the source pointed out.
According to a memo addressed to the General Manager of Guinness Cameroon by the Ministry of Trade with respect to the price increases, government said, "From every indication, the price readjustment is motivated solely by the company's decision to make returns which, for the moment, doesn't take into consideration the interests of consumers." The letter indicates that following meetings between officials of the Ministry of Trade and those of the company to examine Guinness's proposals to review its prices, the company complained of the prices of fuel and sugar. "The prices of these products, subject to regulation, have remained stable in the past three years," the memo explains.
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