Discordant Tune On The Removal Of Fuel Subsidy – By Afolabi Faramade

0

Get real time updates directly on you device, subscribe now.

There is discordant tune among top Government officials on the contentious issue of removal of fuel subsidy. After a recent meeting with President Muhammadu Buhari, Senate President, Ahmad Lawan informed State House Correspondents “that the President has not directed anyone to remove fuel subsidy.” Prior to Lawan’s meeting with President Buhari, the Minister of Finance, Budget and National Planning, Zainab Ahmed hinted that fuel subsidy would be removed by the middle of the year in line with the Petroleum Industry Act. She said transport grant of #5000 each would be given to the poorest of the poor to cushion the effects of fuel price hike for a period of six months. It is estimated that about 40 million Nigerians would benefit from the grant. At the meeting of the Nigeria Governors’ Forum held during the week, the Governors unanimously agreed that fuel subsidy should be removed and the market price of #302 per litre of premium motor spirit (petrol) be implemented. Both the Nigeria Labour Congress and Trade Union Congress have expressed their opposition to this proposal.

Read Also: Averting Another Looming Opioid Crisis; Primary Prevention – By Dr Olawale Adeyemi

Meanwhile, in the midst of this raging controversy, it is very surprising that Government officials are NOT talking about the urgent need for the resuscitation of the local refineries and this is the crux of the matter. Since the late 1990s, Nigeria has depended wholly on fuel importation despite the

fact that it is the largest crude oil producer in Africa and a leading member of Organization of Petroleum Exporting Countries (OPEC). It is indeed a monumental tragedy that the three refineries in Port Harcourt, Warri and Kaduna have become wasting assets despite series of “Turn Around Maintenance” carried out over the years at huge cost.

As the Government continues to hammer on the need for the removal of fuel subsidy with the concomitant effects on the citizens and the overall economy, Government should also be bold enough to sell the refineries to international core investors or lease them to international oil companies for the benefit of the country. Saudi Arabia’s Aramco; Petrobras of Brazil; Sinopec of China; Total Energies of France and Exxon Mobil of USA run major refineries in the world today.

Continuous importation of fuel is at the root of fuel subsidy regime and is not sustainable. Imported fuel is subject to exchange rate volatility. Nigeria cannot continue to spend huge amount of foreign exchange on fuel importation while the local refineries remain moribund. It simply does not make any economic sense. The refineries are not working due to economic sabotage. The National Assembly should conduct public hearing on the NNPC refineries and set a new agenda for the future.

*Faramade is Programme Director of Journalists Against Poverty (Email: [email protected])

Leave a Reply

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.