As Nigeria grapples with the decision to remove fuel subsidies, the road ahead seems rocky and uncertain. The government’s finances have been battered by the costly subsidies, but opposition to their removal is growing by the day.
President Muhammadu Buhari, who will leave office in a month, had initially seemed to leave the removal of the subsidy to the next administration. However, he brought the date closer without providing a clearly outlined roadmap for its removal.
The Central Bank of Nigeria’s attempt to redesign the naira led to a severe cash crunch, further exacerbating the situation. The deadline for phasing out high-value naira notes was later postponed to December 2023 after the country’s highest court intervened, providing much-needed relief to Nigerian businesses and households.
Despite the mounting challenges, President-elect Bola Tinubu has vowed to remove the subsidy upon resumption of office. Tinubu, who returned to Nigeria after a month-long stay in France, said he felt “refreshed” and “ready for the task ahead.”
However, several groups have threatened mass protests, with the Northern Youth Council of Nigeria being the most recent.
The opposition to the subsidy’s removal is fierce, as Nigerians feel that the pain and anger caused by the Naira shortage are responsible for their renewed opposition.
Gabriel Taminu Aduda, Permanent Secretary, Ministry of Petroleum Resources, has stated that there is no specific date for the subsidy removal. He alluded to the fact that considerations were still being made about the impact it would have on the people.
The latest World Bank data reveals that Nigeria spent 96 percent of its revenues repaying creditors in 2022. The removal of the petrol subsidy is one of the key reforms needed to alleviate the government’s financial burden.
In conclusion, the road ahead for Nigeria’s fuel subsidy removal is rocky and uncertain. While President-elect Tinubu has vowed to remove the subsidy, the opposition to its removal is fierce and growing.
With only a month left before President Buhari steps down, it remains to be seen if Nigeria will be able to remove its costly fuel subsidy.