Federal Government Denies Plan To Remove Fuel Subsidy

The International Monetary Fund (IMF) and the World Bank has mounted pressure on Nigeria to end its fuel subsidy regime, but the Federal Government has said
there is no immediate plan to remove the petroleum lifeline.

Yesterday, Sunday, 14th of April, 2019, the Petroleum Products Pricing Regulatory Agency (PPPRA) make known that the daily consumption of petrol in Nigeria has increased by two million litres - from 54 million litres in 2018 to 56 million litres in 2019.

The Minister of Finance, Mrs. Zainab Ahmed, while addressing journalists yesterday during a ministerial press briefing at the end of the World Bank/IMF Spring Meeting 2019 in Washington DC, said the subsidy would remain because the federal government was yet to have an alternative to cushion the effects of the removal.

"On the subsidy, there is no imminent plan to remove fuel subsidy. We are here to discuss with the global community on various policy issues. One of the issues that always come up in the reports, especially IMF Article IV Report is how we handle subsidies. So, in principle IMF will say fuel subsidy is better removed so that you use the resources for other important sectors, and in principle that is a fact but in Nigeria, we don’t have any plan to remove subsidy at the time. This is because we have not yet designed buffers that will enable us remove the subsidy and provide cushions for our people

So, there is no plan to remove subsidy. We will be working with various groups to find what will be if we have to find what the alternative is. We will discuss this at the EMT. We have not yet found viable alternative, so, we are not yet at the point of removing subsidy." - said, Mrs. Zainab Ahmed

On Eurobond, Ahmed stated that the issuance is going to be the second one this year and the bond is going to be utilised for some agricultural projects, for some power projects; mostly solar projects as well as projects in the water sector.

The essence is that the project must be green. They must be projects that are not contributing to emissions in the society. The green bond is a successful one. All the projects that were scheduled to be financed by the green bond have been so financed and the projects are at various levels of completion.

After much deliberation, Kachikwu noted that it would had been a major issue for the country if there was insufficient product on ground but assured that NNPC would be able to resolve whatever the situation was in a few days.