• Stakeholders call for more consultation, phased subsidy removal
• You can’t remove fuel subsidy through mere announcement, says professor of energy economics
• ‘Tinubu must increase revenue generation to achieve stable exchange rate’
• NLC, TUC, NECA: New President must engage labour before removing subsidy
• HURIWA calls for mass protest, warns against unilateral decision
• Unified exchange will increase investment, capital inflow
President Bola Ahmed Tinubu, yesterday, kick-started the long, tortuous journey towards pulling the economy from the woods, declaring that the days of fuel subsidy are gone and hinting at the need for a “thorough house cleaning” in the monetary policy.
Tinubu had bared his mind on the two areas previously as a candidate and his views were unambiguous. He merely re-echoed his long-held views on the subject yesterday in his inaugural speech as the 16th president of Nigeria.
In Lagos, the subsidy removal message struck a chord with marketers as most filling stations stopped dispensing. As of press time, there was no serious panic buying but The Guardian observed a gradual reduction in the number of fuel stations that opened for business. In Abuja, long queues resurfaced as some marketers shut down their operations.
With no cabinet to explain the subsidy removal pathway, there are concerns that without context to subsidy removal, chaos would thrive as marketers hoard products. Just a few hours before the inaugural speech of the president, motorists could go to fuel stations and fill their tanks but the reverse was the reality, a few hours after the speech that hinted at subsidy removal.
Stakeholders have backed the plan by Tinubu to remove subsidies and double the electricity supply in the country but warned that the removal of subsidies could backfire if done without proper consultation and planning.
The stakeholders called for rigorous stakeholder engagement, stressing that unless a gradual and phased approach and critical pricing planning are done, the country may be thrown into crisis.
In the last eight years under the former president, Muhammadu Buhari, about N17.5 trillion was spent on fuel subsidies while N10.5 trillion out of the total spending happened in the last 18 months of the administration.
Energy expert and former legal lead at Shell, Ameh Madaki, said the sudden announcement by Tinubu would create a chain reaction and lead to suffering of millions of Nigerians in the short to medium-term.
According to him, marketers would profiteer immediately by hoarding products to maximize their margins and the next few days would be grueling indeed.
“Having been sustained for this long, a phased approach to it which takes cognizance of all its ramifications would have been a better option in order not to disrupt an already impoverished citizenry and a fragile economy.
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