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Business Hilights
Tracking Nigeria's Headline Business News Online

Removing subsidy without fixing infrastructure, refineries, power’ll be suicidal—Expert

As the campaign for removing fuel subsidy is gaining momentum mainly from petroleum industry players and several international organizations including the International Monetary Fund (IMF) boss, Ms Christine Lagarde, a public affairs commentator, Barr Jimoh Adegoke has joined the Nigerian Labour Congress (NLC) to fault the campaign.
According to him, “Removing fuel subsidy will free a lot of money for the government to fund yearly budget and do other statutory development programmes for the citizens.”
“However, there are thing you need to remove from every meat before you eat it otherwise, the meat will become poison capable of killing the people.
Adegoke noted that “Some of the things Nigeria needs to remove from ‘the meat of subsidy’ before dropping the policy include fixing all essential infrastructure for daily economic activities including roads, steady power supply, rail connecting every state capital and major cities and others”.
“Also, all the four national refineries must be working to full capacity with old and new product distribution pipelines effective to ward off tankers on highways.
Adegoke said when these conditions are on ground, any government in power then can go ahead to remove fuel subsidy, otherwise, there will be heavy unrest that may not be so easy to contain.
Only weekend, the Managing Director of IMF, Madam Lagarde, called on the Federal Government to remove fuel subsidy, saying it is the right thing to do.
Addressing a press conference on Thursday at the on-going joint annual spring meetings with the World Bank in Washington DC, the IMF boss said with the low revenue mobilisation that existed in Nigeria in terms of tax to Gross Domestic Product, it was important for the country to remove fuel subsidy.
Business Hilights recall that the IMF had in its 2019 Article IV Consultation on Nigeria noted that phasing out implicit fuel subsidies while strengthening social safety nets to mitigate the impact on the most vulnerable would help reduce the poverty gap and free up additional fiscal space in the country.
However, checks along the corridor of power in Nigeria suggest that the current administration though in a strong pressure to remove subsidy ahead of Dangote Refinery delivery next year, may not give in considering the absence of infrastructure and failed four national refineries which the same government that won reelection had in 2015, promised to fix and even build six new refineries across the six geopolitical zones.

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