The Haitian government has cut petrol subsidies, pushing the price of fuel up after the government redirected money to other programs.

The subsidies had been implemented by Rene Preval, the president, to prevent instability after April riots over the high cost of food that left at least seven dead.

Prices immediately rose by 80 cents-per-gallon to $6.14, a huge increase in a country where people live on less than two dollars a day.

The government, which is short of funds, said it could not afford assistance that had amounted to an estimated US$15 million over three months, while attempting to combat the ongoing food crisis.

Global issue

Kesner Pharel, a Haitian economist, said Preval could “pay some political price” for allowing the increases, which were announced on Thursday.

“It’s a difficult choice but…if you keep losing money like that you have a price to pay in the medium and long term,” Pharel said.

Port-au-Prince’s public taxis, or “tap-taps,” raised fares to cope with rising fuel costs, prompting arguments with passengers.

“The passengers don’t want to pay. We have to fight with them,” said Molier Benoit, whose syndicate doubled its fares to 12 gourdes (31 cents) for a ride in a metal frame built onto the back of a truck.

Rising fuel costs have strained economies and spurred protests around the world, prompting Saudi Arabia, the world’s leading oil producer, to pledge to increase output at a meeting between producer and consumer nations last week.

http://english.aljazeera.net/news/americas/2008/06/2008627233814418599.html