Friday, December 3rd, 2021

FG to end petrol subsidy in 2022, World Bank, experts, others react.

FG to end petrol subsidy in 2022, World Bank, experts, others react.

The issue on fuel subsidy is becoming excruciating and alarming, has Federal Government have decided to pay 5,000 grants to 40 million Nigerians as part of measures to lessen the negative impact of petrol subsidy which will be introduced in the year 2022. Regarding to the issue of fuel subsidy, the Minister of Finance, Budget

The issue on fuel subsidy is becoming excruciating and alarming, has Federal Government have decided to pay 5,000 grants to 40 million Nigerians as part of measures to lessen the negative impact of petrol subsidy which will be introduced in the year 2022.

Regarding to the issue of fuel subsidy, the Minister of Finance, Budget and National Planning, Zainab Ahmed, said the government would remove the subsidy by 2022 and replace it with N5,000-a-month transportation grant to the poorest Nigerians.

Speaking at the launch of the World Bank Nigeria Development Update (NDU), the minister, who noted that the grant would be paid to about 30 – 40 million Nigerians, said: “The subsidies regime in the oil sector remains unsustainable and economically disingenuous.

“Ahead of the target date of mid-2022 for the complete elimination of fuel subsidies, we are working with our partners on measures to cushion potential negative impact of the removal of the subsidies on the most vulnerable at the bottom 40 per cent of the population.

“One of such measures would be to institute a monthly transport subsidy in the form of cash transfer of N5, 000 to between 30 – 40 million deserving Nigerians.”

Going further World Bank has also urged the President, Muhammadu Buhari’s administration to remove fuel subsidy in Nigeria

According to the bank, the Nigerian government took bold measures to mitigate the effects of the COVID-19 pandemic in 2020 through reforms, but that “the momentum of the reform agenda has waned, undermining Nigeria’s long-term growth prospects.”

The report stated that; “the insufficient supply of foreign exchange (FX) issues related to the predictability of exchange rate management, the unsustainable subsidy on premium motor spirit (PMS), burdensome trade restrictions, and the sizable fiscal deficit financing by the Central Bank of Nigeria (CBN) are undermining the business environment, compounding underlying constraints on domestic revenue mobilization, foreign investment, human capital development, and the delivery of public services.”

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