Subsidy Removal: FG Saves N400 Billion in 4 weeks

Mr. Chinedu Okonkwo, the National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), recently disclosed that the federal government of Nigeria has achieved savings of N400 billion over the past 30 days since the fuel subsidy was abolished.

President Bola Tinubu made the announcement about the termination of the petroleum subsidy regime, clarifying that the 2023 budget no longer includes provisions for it.

The funds previously allocated to subsidies will now be redirected towards crucial areas such as public infrastructure, education, healthcare, and job creation.

Mele Kyari, the Group Chief Executive Officer of the Nigerian National Petroleum Corporation Limited (NNPCL), had previously stated that the country was spending N400 billion every month on fuel subsidies.

Mr. Okonkwo discussed the long-term implications of subsidy removal and changes in the foreign exchange market. He mentioned that these factors could result in either an increase or decrease in fuel prices, depending on the market-determined price of foreign exchange. Additionally, he emphasized the gradual reduction of the impact on the general population through the introduction of Compressed Natural Gas (CNG) in the sector.

Mr. Okonkwo underscored that the elimination of subsidies has led to substantial savings for the government, while CNG presents an alternative solution to mitigate the effects on consumers.

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By Chinedu

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