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Gradual removal of petrol subsidy starts April —FG

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The Minister of Finance, Budget, and National Planning, Zainab Ahmed, stated that the government may start phasing out petrol subsidies starting April 2023. The statement was made during an interview with ARISE TV on the sidelines of the World Economic Forum in Davos, Switzerland. The government plans to spend N3.35 trillion on petrol subsidies from January to June 2023. The minister highlighted that it is important for the government to exit the petrol subsidy regime as it is revenue that could be going into government funds.

“Where there is not enough revenue for government to buy the refined petroleum products, we have had to borrow to buy the petroleum products. So, if we take that out, that is about N3.25 trillion. That is a significant relief, that we do not incur any more than that number that we projected for in 2023,” she said.

When questioned if she felt let down that the petrol subsidies had not been removed, despite her efforts to make it happen, she emphasized that the decision to keep the payments was made collectively.

“Betrayed? No. It was a decision that was taken as a collective, recognizing the fact that due to the lingering impact of the COVID-19 pandemic, and also heightened inflation, that removal of the fuel subsidy at that time, would have increased more burden on the citizen,” Ahmed said.

She also added that President Muhammadu Buhari does not wish to take any steps that would worsen the economic struggles in the country.

“The president does not want to contemplate a situation where measures are taken that are further going to burden the citizens. So, the decision was to extend the period from June 2022 (sic) to 18 months, beginning from January 2022,” the minister said.

“So, in June 2023, we should be able to exit. The good thing is, we hear a consistent message that everybody is saying this thing needs to go. It is not serving the majority of Nigerians.

“I listened to some of the new leaders that are campaigning for the next round of leadership in the country that are saying they will get rid of it very quickly.

“What will be safer is for the current administration to maybe at the beginning of the second quarter to start removing the fuel subsidy, because it’s more expedient if you remove it gradually, than to wait and move it all in one big swoop. The removal of petrol subsidies will lead to an increase in the prices of AGO, PMS and DPK. This is because the cost of the subsidies being paid by the Federal Government on these products will now be charged to the consumer.

Source:  The Cable, Vanguard NGR

This Post Has 3 Comments

  1. Greetings! Very useful advice in this particular article! Its the little changes that will make the biggest changes. Thanks for sharing!

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