Nigerian President Bola Tinubu on Wednesday defended the West African nation’s decision to end fuel subsidies, a move that has already exacerbated economic hardship by driving up freight and freight prices.
Tinubu told governors at a meeting in the capital Abuja that the money saved after ending a decades-long subsidy last week will help with the government’s poverty alleviation initiatives.
He called for patience even as difficulties hit millions of citizens hardest
“We can see the effects of poverty on the faces of our people, poverty is not genetic but social. Our position is to eradicate poverty,” Tinubu said in a statement from the Nigerian president. The governors supported the removal of the subsidies and promised to work together to make it happen, according to the president’s statement.
Although Nigeria is an oil-producing country, it is dependent on imported refined petroleum products and the government has subsidized costs for decades. But with oil revenues dwindling amid chronic theft and falling foreign investment, the government says fuel subsidies are no longer economically viable. It budgeted 5.5 trillion naira ($9.8 billion) in grants by 2022, far more than education, health and infrastructure combined.
However, analysts criticized the government’s decision to withdraw subsidies without incentives, especially at a time when many Nigerians are struggling to cope with unemployment and poverty and very high levels of inflation in more than18 years. Unions have threatened to strike to protest the subsidy decision.
The states of Nigeria have begun to apply various measures to support the people, especially the workers who go to work every day. The states of Edo and Kwara this week reduced the working week from 5 days to 3 days and also considering measures such as raising the minimum wage by 30,000 naira ($65).
Business struggling after subsidies ended as they were forced to spend more money on generator fuel in Abuja and other parts of Nigeria reported by the Associated Press. According to the World Bank, up to 46% of Nigerians do not have access to electricity
In Kano state, the economic hub of northern Nigeria, Mahmud Mudi, a taxi driver, said he had to stop his trucking business because of losses due to soaring gasoline costs.
“The situation is unbearable,” Mudi said the situation is too much. “As a family person the already hostile economy was made worse by the removal of this fuel subsidy. I’m halting my taxi operations to seek divine intervention.”
Rafi’atu Audi, a state government employee, said it was difficult to get to work every day due to the high cost of transportation.” Transportation rates have skyrocketed, but our wages have remained the same,” Audi said. “It’s so panful (and) I can’t take it anymore.”
