Crude oil production up in June
The North-South Economists’ Forum, NSEF, a focus group of development economists, has faulted President Muhammadu Buhari on the proposed removal of oil subsidy by June this year.
The Buhari government had announced that oil subsidy which the government once described as a fraud when it was in the opposition would cease to exist immediately after the Buhari government hands over to the next government.
Nigeria is facing a major election this February and March that would determine the make up of the next administration.
But in a statement on Thursday, the body of development economists faulted the Buhari government for trying to leave a problem it could not solve in 8 years for its successor.
They also faulted the N3.36 trillion to be spent on subsidy till May this year, saying the indices show a clear lack of probity on actual consumption of petroleum products in the country.
NSEF said it was unfair for the Buhari government to give a timeline beyond its life on an issue it could not decisively deal with in 8 years.
In a press release signed by its Chairman, Malam Ahmed Abdulkadir and Secretary, Dr. Chima Eboh, NSEF said the Buhari government was trying to run away from its shadow, adding that it will not be binding on any new government to take the pill Buhari government failed to swallow in 8 years.
“You cannot leave behind you could not clean for another person to clean from the first month of resumption of duty. The best approach would be to stay quiet on the subsidy bogey which has haunted several governments,” the group said.
Nigeria’s main forex earner is crude oil which since 2015 has taken a shellacking in pricing in the international market.
Nigeria will keep its costly but popular petrol subsidy until mid-2023 and has set aside 3.36 trillion naira ($7.5 bln) to spend on it, Finance Minister Zainab Ahmed said on Wednesday.
Africa’s biggest economy spent 2.91 trillion naira ($7 billion) towards a petrol subsidy between January and September 2022, state-owned firm NNPC said, a cost the government has blamed for dwindling public finances.
President Muhammadu Buhari signed the 2023 budget of 21.83 trillion naira ($49 billion) into law on Tuesday after lawmakers increased the size by 6.4% and raised the oil price assumption.
“Petrol subsidy will remain up to mid-2023 based on the 18-month extension announced early 2022,” Ahmed said.
Buhari said in October that the country would stop the petrol subsidy in 2023, when he steps down after Nigerians vote for a new leader in February.
Successive governments in Nigeria have tried and failed to remove or cut the subsidy, a politically sensitive issue in the country of 200 million people.
Inefficient use of resources is constraining Nigeria’s development goals, the World Bank has said, urging the country to remove subsidies on petrol, electricity and foreign exchange that mostly benefit wealthy households.
Additional report by Reuters
