- FG to Spend N457bn Subsidy on Other Sectors -NNPC
Mele Kyari, the Group Managing Director, the Nigerian National Petroleum Corporation (NNPC) has said the Federal Government will spend the N457 billion budgeted for petrol subsidy in 2020 on other sectors of the economy.
The managing director had said the nation’s pumping price would be determined by the market forces, saying its goodbye to fuel subsidy in Nigeria earlier this week.
Kyari, who spoke on a live television programme in Abuja on Thursday, explained that Nigeria was subsidising petrol consumption in other West African nations.
He said, “And above all, you have a huge economic distortion where people don’t pay for what they consume.
“That means that you have the cross-border issues, which is because you are selling fuel at a lower price than the market price and we are therefore practically supplying fuel to the whole of West Africa.
“And because of that distortion, some people don’t get salaries. The minimum wage is not implemented in some parts of the country and there are so many distortions.”
The amount budgeted as under-recovery in the 2020 budget would now vanish, said the Mele Kyari.
He said, “No deduction for under-recovery because there will be none. Obviously, those costs will vanish from the Appropriation Act and while that is done, it becomes available for other sectors of the economy.
“There are so many things that the cost of under-recovery has prevented us from doing. We are supplying the whole of West Africa and so the under-recovery is bloated so much because you are actually subsidising West Africa.”