Fuel subsidy to go by June 2023, says finance minister

 

Zainab Ahmed, minister of finance, budget and national planning, has disclosed that the federal government might begin the gradual removal of petrol subsidy from April 2023.

 Speaking in an interview with ARISE TV on the sidelines of the World Economic Forum in Davos, Switzerland, on Tuesday, January 17, Ahmed said they didn't want to remove petrol subsidy during the COVID-19 pandemic as it would have increased more burden on Nigerians. 

 She said; 

 “Where there is not enough revenue for government to buy the refined petroleum products, we have had to borrow to buy the petroleum products. So, if we take that out, that is about N3.25 trillion. That is a significant relief, that we do not incur any more than that number that we projected for in 2023.

Asked if she felt betrayed that the petrol subsidy had not been removed despite her best efforts to ensure removal, she stressed that it was a collective decision to retain the payments.

“Betrayed? No. It was a decision that was taken as a collective, recognising the fact that due to the lingering impact of the COVID-19 pandemic, and also heightened inflation, that removal of the fuel subsidy at that time, would have increased more burden on the citizen. 

“The president does not want to contemplate a situation where measures are taken that are further going to burden the citizens. So, the decision was to extend the period from June 2022 (sic) to 18 months, beginning from January 2022.

“So, in June 2023, we should be able to exit. The good thing is, we hear a consistent message that everybody is saying this thing needs to go. It is not serving the majority of Nigerians.

“I listened to some of the new leaders that are campaigning for the next round of leadership in the country that are saying they will get rid of it very quickly. 

“What will be safer is for the current administration to maybe at the beginning of the second quarter to start removing the fuel subsidy, because it’s more expedient if you remove it gradually, than to wait and move it all in one big swoop.

“So, the idea for us in the budget, is that the subsidy costs should not exceed that N3.23 trillion. So, whether it’s done completely 100 percent by June or by July, or whatever, it’s a process.”